Author: Karl Smallwood / Source: Today I Found Out
Isaac R. asks: When people buy expensive art worth hundreds of millions of dollars, how do they pay for it? Like could they pay with cash or do they have to have their bank wire the money? Just wondering about the nuts and bolts here.
As we’ve discussed before, there are a handful of people walking around right now with a hyper-exclusive jet-black American Express credit card in their wallets that they could theoretically use to buy anything currently for sale, regardless of its cost.
In fact, the current record we could find charged on such a credit card is $170 million charged by Chinese billionaire, Liu Yiqian, who no doubt is the world record holder for those sweet, sweet flight mileage points. But let’s imagine for a moment that a super-rich person didn’t have such a card or for whatever reason wanted to buy something worth millions of dollars not with a credit card, but cash. Could they? Well, surprisingly, in many countries no, with some exceptions. So let’s now talk about how the uber-wealthy actually go about paying for things worth millions upon millions of dollars.To begin with, for the most part, paying for something worth a pile of Ferraris is the same as paying for any other item, with the fancy auction houses and stores we researched all offering the same basic payment options as stores for us peons. For example, Sotheby’s auction houses notes that customers can pay for any items they purchase “by bank transfer, cheque or cash (subject to any restrictions and legal limits)” while famed luxury superstore Harrods notes that you can pay for any item they have for sale with PayPal if you really wanted to.
As for how the immeasurably wealthy actually end up paying for such items, most of the time they just put it on their card.
What about transaction limits, you say?
As you can probably imagine, the credit cards used by millionaires and billionaires are different to the ones doled out to us mere mortals and come with a host of additional benefits to ensure the holder doesn’t up and take all of their money elsewhere.
Although the existence of these cards isn’t exactly a secret, banks that issue them don’t usually allow customers to apply for them, instead in most cases invite particularly wealthy customers to use them. While the most famous of these cards is arguably the Black American Express card alluded to at the start of this piece, there are a number of similar credit cards out there that fulfill essentially the same function, in that they allow the holder to buy any item they wish regardless of its value and provide a ridiculous number of services that come for free with simply having the card at all, including what almost amounts to something of a personal assistant in some sense, or at least someone who can figure out how to make whatever you want to happen, happen. This might be something as simple as tracking down tickets to a sold out show and acquiring them, to more outlandish requests.
If your imagination isn’t all that great, according to one executive at Amex asked about the more bizarre requests the company has fulfilled on behalf of customers holding their Centurion card, he noted they had a card holder once call up and ask for a handful of sand from the Dead Sea be delivered to their address in London. The company handled it from there, sending an international courier to the shores of the Dead Sea on a motorcycle. The courier then posted the sand to the customer. Apparently the sand was to be used in a school project for the customer’s kid.
In another case, the cardholder wanted to appear on a soap opera, but wasn’t sure how to make this happen. The Amex representative managed to get the woman an audition for a role in such a show.
Yet another bizarre request was from someone wanting Amex to find the horse ridden by Kevin Costner in Dances with Wolves. They were not only able to track this down for the customer, free of charge for this sort of service, but were also able to arrange for purchase of the animal and then had it transported to Europe where the customer lived.
In any event, contrary to popular opinion, these cards do often have a maximum limit, it’s just that this limit is informed by the holder’s personal wealth and the relationship they have with their respective bank. So in the case of billionaires and the like, since any theoretical limit put in place would exceed the value of almost any item available for purchase on Earth, it’s easier to just say the card has no limit, even though the bank would almost certainly query such an individual trying to charge a billion dollars to their card unless they got pre-approval for the transaction.
In the event a billionaire, for whatever reason, decided that they instead wanted to pay for something worth millions of dollars out of pocket rather than putting it on a credit card, they could just as easily also pay using a debit card or a personal check. As with credit cards, there’s no set limit to the amount of money an individual could spend in this manner on a single transaction. There would just be similar caveats to the credit card payment method of certain transactions likely to be double checked if they were truly outlandish and out of the ordinary for a given account holder. And, of course, in these cases the one added caveat of the money needing to be in their account at the time, unlike a credit card purchase.
On that note, for anyone curious, the largest known personal check ever written was for $974,790,317.77 in 2014 by one Harold Hamm to pay his ex-wife a court mandated settlement after a divorce. Amazingly, Hamm’s ex-wife originally refused to cash the check, feeling the amount was too small given Hamm’s then net worth of $18 billion. However, she abruptly changed her mind the next day and cashed it anyway. According to Forbes, the process of cashing the check went ahead mostly like any other, with the exception of the bank calling Hamm to make sure the check was genuine before depositing the money into his ex-wife’s account.
The largest known business check on the…
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