There are two things regarding Citibank in the news lately that I thought I’d share. You might already be affected, or it may serve more as a cautionary tale for the future.
Funding shutdown
First off comes the news that Citibank is no longer allowing you to fund checking accounts with a credit card. I had written about this a few months ago during a Citigold promotion that offered 50,000 Thankyou Points or 50,000 American AAdvantage miles for opening up a Citigold checking account and meeting a few minimal criteria
(SEE ALSO: The ongoing drama trying to fund my Citigold checking account)
One of the added perks to opening up the Citigold checking account was that ADDITIONALLY, you could make the initial funding of the account with a credit card. That is what I did, and after combining the credit limits of my Bank of America Alaska cards, I funded it with a $39,000 “purchase”. Although I got a comment on Twitter that doing so was unethical or dishonest in some way, I am not sure I agree with that.
In any case, Miles to Memories is reporting that Citibank has stopped this ability to fund checking accounts with a credit card. There is also discussion about this on Reddit, Flyertalk, Frequent Miler and in the comments on this Doctor of Credit post. I am not surprised that Citibank has made this change. There IS a current Citigold 50K bonus going on, which is still probably worth doing, but just note that you’ll “only” get 50,000 points.
Citibank credit card account closures
The other Citibank related news is that they selectively closed several people’s credit card accounts
I first saw the news reported on Doctor of Credit, and there is also discussion on Flyertalk as well. The general consensus now has been that most (but not all) of the shutdowns have been to people who have done a fairly high amount of spending
As we’ve discussed on this blog before, the rules are getting tighter. From the Chase 5/24 rule to Serve and Bluebird accounts getting shutdown, it’s always a smart idea to diversify your miles and points generating!
Readers: Have any of you been affected by either the Citibank account shutdowns or the removal of the ability to fund checking accounts with a credit card?
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Dan Miller travels with his wife and 6 (SIX!) children. He loves to help families travel for free / cheap, especially larger families. If you are looking for help, drop him an email at 
After 11 months of 78K/month MS all my Citi cards have been frozen/shut down as well as the cards I opened for my kids and wife. I’m sitting on fistfuls of gc’s and no place to dump them. My ‘bird and Serve were shut down last month. I thought I’d be ok – open up a bunch of checking accounts for me & family. Now I’m sitting on a fistful of big gcs, the checking accounts can’t be funded with credit cards, and my wife and kids no longer have Citi cards that work. Not good.
You should be able to use your Gift Cards to pay your taxes. I used some to pay both Personal (1040) and business taxes (W-2) taxes. Yes, there is a a fee for doing so, but at least you get rid of the gift cards. I got rid of 5.5k in gift cards doing just what I have described.
I don’t MS, but I just opened a Premier and was planning on meeting the minimum spend by purchasing online gift cards in small amounts for work (legit expenses). Now I’m a little nervous. Overall it’ll be about 3K in about 3 months, so maybe I shouldn’t worry.
Naomi – I wouldn’t be worried about that. From what I’ve said, the people whose accounts have been shutdowns have been operating at a level ORDERS OF MAGNITUDE higher than that
Good point. I just noticed the 78K per month!!! Wowsa!
And that actually isn’t THAT much in the MS-world. I met a guy at the Cincinnati miles and points meetup who (said he) does 400K / month.
Oh wow. I’ve contemplated MS, but time and risk have always been a deterrent. I couldn’t have that much money floating around! But, maybe I need to start dabbling in smaller stuff…to get my feet wet.
Well a couple comments. First to the guy doing 78K a month or almost a million a year and you wonder why you got shutdown.
While I don’t think what Sean did was unethical, I do think that by pushing the envelope and then publishing it, so that many others did the same thing probably helped end the credit card funding.
That was my thought also…. :-). And I assume when you said Sean you meant me (Dan) and I do agree somewhat that there is a correlation between a deal’s popularity and how soon it gets shut down. I just wrote a post with my thoughts on deal killing last week.
Just got a notification today in the mail that my old citi preferred card account is shutdown due to inactivity (and hadnt used it in over a year). I’m definitely not an MSer, so it seems they are closing old and unused accounts as well.