What I Did when Chase Tried to Cancel My Sapphire Preferred Card

There have been several reports in recent weeks of Chase canceling the Sapphire Preferred cards of people who have combined points between individuals. (To clarify, when points are moved between people Chase calls this “combining,” and when points are moved between Ultimate Rewards and a loyalty program this is called “transferring.”)

The terms and conditions forbidding this weren’t always very clear, especially since Chase did nothing to stop you whether you tried to transfer over the phone or online. It’s only now that their fraud department is auditing these points combinations that they have decided to close accounts and made the language more explicit.

In my case, I got in trouble for receiving Ultimate Rewards points from other people who were not my spouse or domestic partner. That’s it, and it seems silly because other people were the active participants initiating the transfers. I was not sending points to other people. I was not transferring them into the partner accounts of other people. And in fact, the vast majority of these combinations were from Megan, who probably qualifies as a domestic partner (at least, her employer’s health insurance plan seems to think so). Other people included family members, and I’ll admit that’s still against Chase’s rules. Just not rules I was aware of.

In my case, I was very fortunate that I got a letter from Chase before the account was closed. Many people only found out when their cards were rejected during a purchase. In my letter, I was told:

Eligible points can be accessed over three full months from the date that your account is closed. For example, if your account was closed on October 30, your points are accessible until January 30. Any rewards remaining after that time will no longer be available.

If your rewards program requires using your Chase credit card to redeem rewards, those rewards are no longer eligible for redemption once the account is closed.

This language is pretty vague. So I called the number on the back of my card to figure out my options. My priorities were:

  1. Keep the card open. The fact Megan wasn’t flagged as my domestic partner might sway their willingness to hear an appeal.
  2. Move the Ultimate Rewards points to a different card. Not Megan’s Sapphire Preferred since they’ll close hers, too. But I heard that some people were successful moving them to an Ink Bold card.

In my experience with the customer service representative, I found there is no obvious indication on your account that the card will be closed. It wasn’t until I told her about the letter that she pulled up a copy of it and learned what was going on. Her computer provided instruction not to escalate to a supervisor if I asked, and that there was no way to save the card. A decision was made.

Finally, I could only redeem the points for cash or gift cards. I could not transfer them to any other Ultimate Rewards card or redeem them into my United MileagePlus or Hyatt Gold Passport accounts.

Prioritize on the Points

I was not happy about this last bit of news. I had consolidated all the points from my own Ink Bold and from Megan’s Sapphire Preferred into this one account to make it easier to track them, and now they would all be useless. These were the same points we were saving for our honeymoon.

So I asked again if I really had no option to transfer them to United or Hyatt, even if it was my own loyalty account. It seemed odd to cut off those options and force me to redeem for cash. That’s when the customer service representative volunteered to contact a supervisor for clarification.

I have read of other people arguing over the phone that Chase was complicit in these transfers since it didn’t prevent them earlier, or arguing that they should be allowed to speak to a supervisor anyway. My advice is don’t risk pissing off the agent. Be calm and work your way to a situation where he or she volunteers to contact a supervisor. It’s always good to keep the customer service representative on your side.

I had given up at this point on saving the card, and I made that clear both to the agent and her supervisor. I didn’t need to make it hard on them if they could focus on other priorities. Now I just wanted to save the points. No one signs up for a Chase Sapphire Preferred card hoping to redeem the points for cash.

The supervisor listened to my argument that Megan was my domestic partner and offered to escalate further. He thought I had a good chance of keeping my Sapphire Preferred if that was the only issue, and he offered to request at the same time that the points be transferred to my Ink Bold if the card still had to be closed. However, I would not get a response for two or three days …after my account was due to be closed. My options might become less flexible after that happened.

I appreciated his gesture but explained why I was concerned. He put me on hold before coming back to say he thought he could just transfer my points to my Ink Bold and avoid escalating to another supervisor. In a few minutes, that combination was complete, and I should be receiving a letter in the next few days confirming the combination. They already show in my Ink Bold account.

What Happens Next?

I’m not done. I remain wary that Chase may revoke them from my Ink Bold account or do something to prevent me from using them. At least I had a supervisor combine the points for me, to another account in my own name, so I have that to fall back on.

I feel tempted to transfer them from my Ink Bold to United or Hyatt, but I will probably hold off. The purpose of having these points is flexibility so that I can transfer them later when necessary.

My Sapphire Preferred card still has a significant credit line and remains open for a few days. I don’t want the bank to close my card for me (that’s never a good sign on your credit report), so I will close it myself the day before and see if that helps at all. I’ll also transfer the credit line to another Chase card.

Finally, I asked the supervisor about my options for getting another Sapphire Preferred card in the future. He first thanked me for being a loyal Chase customer. It’s worth noting I have only once cancelled a Chase card; I pay the fees on the others to keep them open, and those fees are worth the benefits they provide, like a free hotel night or some bonus points.

However, these decisions to close Sapphire Preferred accounts are being made by an unemotional department focused on security and fraud. I can apply again, but the T&C violation in Chase’s files will be permanent. He recommended waiting six months. In the meantime, I can be added as an authorized user on Megan’s card. This actually works out pretty well since the annual fee on my Sapphire Preferred was due next month, and now I don’t need to pay it.

I don’t hate Chase for doing this. Assuming I can keep the points in my Ink Bold account, that works out well. I realize many people will not have that option, and they are probably more upset. Chase is doing its part to stamp out fraud, and when it comes to banks, they have to be more careful than most companies. Someone who really is rigging the system can probably come up with a more plausible excuse than mine, even though mine is true. So I’ll take my licks, wait a few months, and apply again at some point in the future. I may even get another bonus.

And I will never, ever transfer points again unless they are between Megan and me …after the wedding and official name change take place!

About 

Scott created Hack My Trip while traveling on a budget during graduate school and continues to share his thoughts on better travel. He maintains elite status with American Airlines, Alaska Airlines, Hyatt, and Starwood.
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  • Ryan From MA

    just got the letter yesterday too. I’m checking my account transfers to see other possible closures…thankfully i was going to close them anyways but after reading your post i think i’ll proactively close my account

  • Matt

    Thanks for the heads up and your plan of attack. Quite useful information there. Hoping I don’t end up with a letter. When did your letter come, and was it only Megan’s account that they talked about (due to the last name difference)? I have received transfers from my parents, but since I have the same last name, I’m wondering if it wouldn’t trigger a letter.

    • Scottrick

      It came on Saturday, postmarked on Monday.

  • Teri

    Yikes! Thanks for sharing! Can I ask a follow-up question about the timeframe? Were these recent transfers, or from a while back?

    • Scottrick

      Throughout the year, maybe one a month. The last was in October.

  • Patrick

    Wow thanks for the heads up. I had no idea Chase/UR was cracking down on transfers. I recently transfered 30,000-ish points from my wife’s account to mine, but … We have separate last names AND billing addresses (long story) so I’m guessing my account is flagged now. I’ll contact them to add her to my account and vice versa, but just in case I’ve already transferred the points to United. I’d hate to lose the nearly 70k I had in UR points. I just hope if the do flag me they won’t/can’t somehow pull them back from United.

  • Samuel

    “I don’t want the bank to close my card for me (that’s never a good sign on your credit report)”

    That’s an urban myth. It makes absolutely no difference on your score no matter who closes it.

    • AJK

      It may make no difference to your SCORE, but you can bet your bottom that it’ll make a difference during a manual review of your credit report (a la Chase recon).

  • Mommy Points

    Eeek. That really stinks. Glad you salvaged your points!

  • ed

    You may not, but I hate chase for doing this. A warning would have been sufficient.

    • Scottrick

      A warning would also encourage a truly fraudulent person to change tactics to become less noticeable. A non-fraudulent person should be able to re-apply successfully, but when that new application process takes place, Chase can screen people more carefully than it did before. In this case, it makes more sense to dump customers and bring them back than risk letting fraud continue (intentional or otherwise).

  • Kathy

    My husbands business is at one address and that is where we have his Ink Bold sent to. His Sapphire is sent to our home address. We always transfer the points from the bold to the Sapphire at the end of the month for simplicity reasons. This should be ok, right? This kinda has me worried. Alot of points at stake.

  • mikey

    sound much like what is know is entrapment, having a situation set up and and waiting to see who falls into it.

    • Scottrick

      I get to keep the points, so I don’t see how Chase gains from entrapment.

  • SK

    Same thing happened to me twice, with different relatives.

    and I have noticed that this happens exactly 4 months before year up, the only transfers we did was on the 2nd month of owning the cards. there is no way to make them keep the card and YES you are able to transfer the points to any account, (chase or airline) with no problem, did it 2 times. So basically chase closed 2 of our cards for same reason and why I am mostly pissed is because I have earned more than 200k on each account and by closing accounts, I lost the 7% annual bonus, which adds up to over 25K bonus miles. I don’t think ill ever bank with chase because of this…. it was really uncalled for, it didn’t explain clearly in their docs. BUT make sure to close your card yourself so they dont close it due to incorrect use of the card, and they will put that on the credit report per my understanding.

  • Patrick

    FWIW, I just phoned Chase and explained that I was concerned that they may have flagged me for violating the UR transfer rules by transferring from my wife’s account to mine due to different last names. The rep told me not to worry about it, there wouldn’t be any problem, and we added my wife’s name as an authorized user on my account. I plan to have her add me to her account as well just to be safe. Still glad I got my points out to United first thing this AM, just in case.

  • W.A.

    What was the time frame between receiving the letter and when your first and last point combinations occurred? Also, was your Sapphire renewal period approaching? We’re trying to understand if there’s a time linkage that led to an audit of your account? It’s troublesome to hear that Chase is now less friendly than the IRS in appealing unjust and unilateral decisions.

    • Scottrick

      My renewal is next month. My first transfer was January and the most recent was October.

    • sk

      I opened 1 card on 01/2012 and the other on 03/2012 last transfer on either of those cards was on 04/03/2012, i got the letter for the first card on 08/2012 saying it’ll close in 4 days, and I got the letter for other card on 12/2012…. so basically 4 months prior to the year up….so to me it just seems like they dont wanna pay up what they owe

  • Kenny

    Ive made a couple of (now illegal) transfers in the past, not many, but a few. I haven’t heard anything yet from Chase, do you recommend I preemptively transfer the 60k+ points to my ink bold? Or do you think that will raise even more flags?

    • Scottrick

      I don’t think that’s necessary.

      • W.A.

        Preemptively transferring points away from the card that has had a questionable transfer and putting the points into another UR earnings card (that didn’t have any questionable transfers) seems a safe way to protect those points. So curious why you feel that strategy isn’t necessary?

        • Scottrick

          I don’t think it’s necessary because Kenny hasn’t made very many transfers and there doesn’t seem to be a need to make pre-emptive transfers to Ink Bold. I and others have been able to transfer after receiving notices. If he wants to, great. No harm. I just don’t think he needs to panic about it.

  • marty dee

    I’ve done it with my mom’s account but to play it safe I made sure we were on both accounts to play it safe.Never had issues.

  • Chum

    What about transferring UR points to United Mileage Plus account of a friend, is that a violatoin of T&C as well?

    • vortix

      Yes.

    • Scottrick

      You may only combine points with Ultimate Rewards between you and a spouse or significant other. You may only transfer points from your Ultimate Rewards account to a loyalty program account in your name.

      So if you want to move points from someone else’s Ultimate Rewards account to your loyalty program account, (1) that other person must be a spouse and (2) you should first move them to your own Ultimate Rewards card.

  • TravelBloggerBuzz

    Wow, good to know, thanks!

  • http://www.batteredluggage.com/ W Brian Duncan (aka IPBrian)

    Hope it all works out in the end Scott…I am really glad I have never transferred any points like this! Thanks for the info.

  • monacutest

    Hello, I just found your blog. I’m glad you got to keep your points. Do you think it would be better to call Chase when you want to transfer points just so they have a recording that you are actually transferring your points to your spouse. Also, I think it’s safest that you are both authorized users of each account.

    • Scottrick

      If you have the same last name, that’s probably best. Otherwise, sure, calling Chase isn’t a bad idea if transferring points to someone else’s account.

  • AnnOniMouse

    If you have a really large amount of UR points, like in the millions, and you convert them directly to an account credit from Chase, does it take longer due to fraud reviews, or does it just go through automatically? I’ve considered converting these to other Frequent Flyer programs so that I can then sell 200,000 SW/United/Hyatt at a clip, rather than just asking Chase for a very large payout.

    • Scottrick

      Not knowing anyone with millions of Ultimate Rewards points in their account, I don’t know the answer to this question. I suggest you ask Chase how long it will take them to process the redemption.

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