To start off with, I'm not taking any sides. My goal is to make you aware of the rules and actions that can lead to a shutdown. I'm going to list a bunch of items, and for you, some of these actions may seem reasonable, but Chase is within its right to cancel their relationship with you. This is called a non-satisfactory relationship.
When a non-satisfactory relationship occurs, all of your cards and accounts are closed. Chase will typically mail you a check for the balance in your account.
After this happens, some people may be able to reopen accounts after a few years. In certain circumstances, they will send a message saying you're rejected because of a previous non-satisfactory relationship.
For most people reading this blog, you'll be fine unless you're doing something shady/illegal. Most shutdowns happen because they're seeing unusual transactions and seen as "risky."
With that said, let's run through the list.
Reputational Risk: Be affiliated with an industry Chase doesn't approve
Easy examples of this are gambling, adult films, as well as Bitcoin. Back in 2014, there were a few producers that worked in the adult industry and had their accounts shut down because of it.
On the Bitcoin and cryptocurrency side, especially if you're using Coinbase, my recommendation is to link it to another account that's not Chase.
If you're someone who has large international wires, then I would avoid using Chase because it usually triggers a financial review that can lead to a shutdown. For Chase Private Clients, maybe that changes, but for normal people, it's seen as risky behavior.
Legal Risk: Depositing a lot of money orders
The problem with money orders is the money isn't traceable. Banks get concerned when they don't know where the money is coming from. Their biggest concern is that the money is being obtained illegally.
On the other end of the spectrum, buying a lot of Visa gift cards with your credit cards can flag your account. The main problem is that Visa gift cards are a cash equivalent, meaning you can turn it into cash if you wanted to. When you buy store branded gift cards, it's harder to liquidate.
Some credit cards know when you're buying gift cards because they receive level 3 data, meaning they can see what you're buying. A Scenario where you might want to buy store-branded gift cards is if you're close to hitting minimum spend, and you don't have any other way. Here, you can buy a gift card on Amazon if you know you're going to use it in the future.
Financial Risk: Opening too many accounts in a short period
If you're someone who's new to credit and you apply for a lot of Chase cards in a short amount of time, this may trigger a shutdown. For example, if you received your first credit card three months ago, and you apply for 6 Chase cards in the next six months, it raises a red flag.
The way to lower the risk profile is to lower your credit limits. Again, you're seen as risky because you have a thin credit profile with a ton of credit.
I'm not sure why, but after your third or fourth Chase card, they start to give you high credit limits.
Financial Risk: Credit piggybacking
Another thing that may cause a shutdown is if you do credit piggybacking. This is when you add people to your credit cards as an authorized user when they don't have a purpose of being there. The person typically isn't a family member or in the same household.
The main thing Chase is concerned about is you're selling your credit cards as a service to help them improve their credit.
If you do want to help your significant other out, I think that's reasonable. Just be sure the mailing address is the same household.
Legal Risk: Lawsuits against Chase
This is obvious, but suing Chase is a bad idea. On the other hand, suing someone else is seen as a reputational risk because it can affect their other relationships with other companies.
Legal Risk: Large cash deposits
Large cash deposits are also a red flag because it leaves them wondering about the source of the money. The benefit of a check or a wire is that they can track the origin or the money. With cash, they don't know.
Reputational Risk: Selling your Ultimate Reward Points
Selling your UR points can trigger a shutdown. If you do want to transfer your points to family members, ideally they live in the same household and have the same last name.
If you review the list, most of the actions can be avoided. The only ones that can't are the reputational risk — so if you work in an industry they don't approve of, or if you end up suing someone they don't approve.
My recommendation is to be cautious of your transactions and try to see it from the bank's point of view.