Amazon Credit Card Points Scam: How to Protect Your Rewards

If you use your credit card rewards to pay for purchases on Amazon, you’ll want to pay close attention to your accounts. A sneaky new scam is targeting Amazon's "Shop with Points" feature, allowing fraudsters to drain reward balances without triggering the typical fraud alerts you might expect from your bank. One victim lost a six-figure point balance, highlighting a significant vulnerability for anyone who has linked their rewards-earning card to the online retail giant.

How the Shop with Points Scam Works

This scam came to light when Jason Rabinowitz, an aviation journalist with Flightradar24, discovered his Chase Ultimate Rewards point balance had been almost completely wiped out. The recent activity on his account revealed dozens of fraudulent purchases on Amazon made with the points he had earned on his Chase Sapphire Reserve card. In total, he lost a six-figure amount of valuable points.

The method behind this fraud is surprisingly simple and exploits a gap between your bank and your Amazon account. Here’s the likely process:

1. A fraudster obtains your credit card details, likely from an unrelated data breach.
2. They add your card information as a payment method to their own Amazon account.
3. They then enroll your card in Amazon's "Shop with Points" program.
4. Once activated, they can make purchases on their account using your points balance, and if you don't catch it quickly, you could end up losing them.

Because the transactions are made with points rather than a direct dollar charge to your card, they often fly under the radar of standard bank fraud detection systems.

A Silent Theft: Lack of Alerts Poses a Widespread Risk

What makes this particular scam so concerning is the complete lack of notification. Rabinowitz realized his points were drained in December but had received no alerts from Chase. The fraudulent "Shop with Points" redemptions simply didn't trigger the bank’s fraud algorithms.

According to Amazon spokesperson Josh Pflug, the company notifies its banking partners when a card is enrolled in the program, but it does not alert the cardholder directly. The company's reasoning is that it doesn't always know who the primary cardholder is. This creates a dangerous communication gap where your points can be spent without your knowledge.

This isn't an isolated issue or one limited to a single bank. Reddit threads show cardholders reporting similar points fraud on their American Express and Capital One accounts, indicating a broader vulnerability across the "Shop with Points" ecosystem.

Resolution and Getting Your Points Back

There is good news for victims of this scam. After reporting the incident, Rabinowitz had his entire point balance restored by Chase in less than a week. A spokesperson for Chase confirmed that the company's account protection policy extends to transactions made with points, not just cash.

While the outcome was positive, the experience was unsettling. “The entire experience was upsetting because there was absolutely no notification that the fraud had happened,” Rabinowitz said, “let alone anything I could do to stop it in the first place.” His story underscores the importance of being your own best advocate when it comes to account security.

How to Protect Your Credit Card Points

This incident is a powerful reminder of the risks associated with storing payment information at online retailers. While convenient, it can open the door to fraud that is harder to detect. Here are a few actionable steps you can take to protect your hard-earned rewards:

• Check Your Points Balance Regularly: Don't just scan your monthly credit card statement for suspicious charges. Make it a habit to log in and check your rewards point balance as well. Treat your points like cash, because they are a valuable asset.
• Set Up Account Alerts: While they may not have helped in this specific scenario, enable every possible alert on your credit card and banking accounts, including notifications for any new card activity.
• Report Fraud Immediately: If you notice any unauthorized redemptions or a sudden drop in your points balance, contact your card issuer immediately. As seen in this case, banks are prepared to investigate and restore stolen points. You can also report the issue directly on Amazon's scam-reporting page.