1) Do you have any idea of what kind of total timeframe these kind of companies have been operating for and what kind of future this side hustle has?... It would be a shame to get all excited about this only to be able to get 4 months in and government entity cracks down... Also someone who did not have cards that meet this criteria might open many cards waiting for 2 years to get started and then have this whole thing shut down before those cards are eligible
Depends on the company. Some for years.
As CanuckExpat pointed out, the activity itself has been going on for at least a decade:
It has been going on since at least 2007
From the Washington Post via MyMoneyBlog
I wouldn't build any FIRE plans around this lasting forever, but I'd be happy to get two years out of it before any changes, or before cards get shut down, or whatever. I don't anticipate either of those, but as boarder42 said, it's basically free money (the $/hour rate is ridiculous), so I'll ride it while I can.
There's a lot of churning/CC hacking stuff I only heard about afterwards and have been like "dang, bummer I missed that"--wouldn't be surprised if in a year, two years, whatever, something changes and I'm instead going "well, it was good while it lasted."
I wouldn't be opening new cards to do this in two years, but I definitely left cards open recently that just hit two years I had for travel hacking, and would have normally cancelled due to the $89 annual fee, but instead kept open and enrolled in this.
And if something does change (say with FICO calculations or something) and it gets shut down in 6 months, and you've made 10 grand in the meantime.. great? You still have all your cards, an extra 5 figures in the bank, and it probably took you something like 10 hours for that 10 grand. I'm okay with that. :)
2) I'm really concerned about authorized users calling up and trying to get their card resent to their address. I feel like being an AU on a card would give these people opportunities to sweet talk a customer service representative into somehow getting them access to spend money on the credit line. Like you said in a previous post ARS, they are permitted to spend money on the card but don't have a means to... well what if they somehow create a means to access the account through customer service?
All major CC companies have a policy to only ship the card to the primary person's address (i.e. you). If the AU calls in, they don't have any info to verify the account or change anything (they don't have your social, or DOB, or anything). They are not an authorized user on the account itself to change any information.
Feel free to call your credit card company, right now, and ask them questions about authorized users. Ask them if you add an AU, where is the card sent? Ask them if the AU calls and wants a card sent to them (or wants to change the address on their account), can that happen? The answers will be your house, and no, and no.
Go ahead and give them a call (the number on the back of your card) if you're worried about this. The CC companies themselves will tell you it can't happen. :)
(I did this myself, FWIW.)
One redditor (vflame) claims 3 of his 5 cards were shutdown due to piggybacking.
Without more data, hard to say anything on that. It is certainly a risk, one that can be mitigated by putting less AUs on, and doing it less frequently.
For example, you could add up to 10 AUs (IIRC) on B of A, and do that every month. The company I use caps it to 2 AUs, every 2 months. They have experience with what the cc companies will/won't allow, and have different guidelines per credit card company. Cards getting shut down definitely can happen. If you go all out with this (and some companies will let you, because they don't care if you burn your cards), certainly you will get shut down. If you're reasonable, perhaps not.
If that reddit user was doing a ton of AUs over and over on a card where the cc company is finickier, I totally believe they were shut down.