Is Chase Cracking Down on Ultimate Rewards Transfers?

by on October 24, 2012 · 10 comments

in Chase, Ultimate Rewards

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Update: As of April 2013, Chase Ultimate Rewards has added Virgin Atlantic as a new airline transfer partner.

Recently, Flyertalkers have reported having their Ultimate Rewards credit card accounts shut down and their points taken away for transferring points among Ultimate Rewards accounts as well as to frequent flyer accounts not belonging to them or their spouses.

This prompted me to look more closely at the Terms and Conditions of the Ultimate Rewards program, and here’s what the T&C specifically related to points transfers say.

Regarding transferring points to someone else’s frequent traveler account:

“Ultimate Rewards point transfer features are designed to allow our cardmembers to take advantage of the rewards they earn. The features are not intended to allow transfers to third parties other than a spouse or domestic partner of the cardmember. Transfers to unauthorized third parties or any other abuse of the Ultimate Rewards program may result in suspension or termination of the ability to participate in the program and forfeiture of points already earned.”

Pretty tough terms. As I’ve reported in the past, in order to transfer Ultimate Rewards points into a frequent traveler account with the program’s partners like United or Hyatt, all you need is the member’s name and account number, and most transfers post instantly, making this a super convenient redemption method.

While I have transferred points (not being aware of this specific term) to friends, family members and employees for redemptions like my upcoming Korean Air flight, I’ve never had an issue in the past. I would just advise other members to exercise caution when performing these transfers, and to avoid transferring large amounts of points to many different accounts in a short time period since all of these could possibly raise red flags on your Ultimate Rewards account.

Regarding combining Ultimate Rewards points from various accounts, the terms and conditions say this:

“Yes. You can combine points or rebates from any eligible credit or debit card with Ultimate Rewards. Note: Once points are transferred, they cannot be credited back. Transfers may only be used to combine points belonging to the same individual or business in the program; or for the purpose of enabling spouses or domestic partners to combine points. Chase will not make the transfer if the credit card account(s) or checking account(s), as applicable, are in default at the time of the transfer.”

Again, combining points from various Ultimate Rewards accounts is something I’ve done in the past and it was a great way to put points back into play that might not be used otherwise – either because they were too few for an award redemption, or in increments that couldn’t be transferred to a frequent flyer account, or because they wanted to close a particular credit card while leaving another open.

I just wish Chase had made the rules clearer and given people warnings before shutting down their accounts and causing them to forfeit their points.

It just goes to show that these program rules can change at any time at the credit card issuer’s discretion, and it seems like Chase has started enforcing these little-known provisions more stringently lately, so I would caution others to be as squeaky clean as possible with their accounts.

It pays to have a strong overall relationship with Chase. In my case, I have checking accounts and an auto loan with Chase, plus a slew of personal and business credit cards on which I put a lot of spending all around (all of which earns me points), so it’s in my best interest to remain in good standing with Chase.

On the not-quite-so-dark side, the Flyertalkers who reported having accounts shut down said that it was just one account at a time (the Sapphire Preferred in this case) – the one from which transfers were being made. So those with more than one Ultimate Rewards-earning card were still able to keep those other accounts open and their points from them.

Note that American Express allows external transfers from Membership Rewards accounts to anyone’s frequent flyer or hotel program account. I’ve sent these transfers to many people in the past (including for Twitter giveaways like today’s!) and never had an issue.

Have any of you had issues after combining Ultimate Rewards points from different accounts, or transferring your Ultimate Rewards points into the frequent flyer or hotel program of another person? Please comment with your story below!

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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  • Mileage Update

    I believe there are enough ways to move miles w/o breaking the spirit of their rules. No sense violating T&Cs when you can follow their rules and still do well.

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  • FV

    I have had personal experience with this. My account wasn’t closed but a Chase rep did tell me what is and what isn’t allowed. I’ve probably purchased 300,000 pts from various people over a couple years as I get so much value out of them and have thankfully transferred all of them already to their travel partners. Probably not worth the risk anymore with some people now having their accounts closed and losing their points :(

    Seriously though, why does Chase care who redeems the points or is it just that they’d much rather prefer you use it for something like cash back instead of UA/Hyatt/BA points (because they cost more??)? I could potentially see them targeting those people who buy and sell them on-line but individuals does seem a bit much. Heck, I’ve all but stopped my CCard churn because it’s just easier to buy the UR points, which should be seen as a positive by them.

    Maybe it’s safer to just have people transfer points from their Sapphire Preferred account to your loyalty program directly instead of in to your CCard but unfortunately virtually everyone I know has the Freedom.

  • HikerT

    I made a few nominal transfers but like you am still alive. I think it’s interesting that you of all bloggers, yes Chase’s sponsored blogger ala “Catch The Points Guy” series to explore the ins and outs of the Sapphire Preferred card and Ultimate Reward has posted that he himself has also transferred points, apparently unaware of the rules.

  • Charles Clarke

    “I just wish Chase had made the rules clearer” What have you been using to transfer points? All the times I’ve transferred points with the website, it has been very clearly stated what the rules were.

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  • Deal

    just received a letter that my account will be closed due to prohibited ultimate rewards transfers, and i only did it once on my chase sapphire credit card over 6 months ago

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