Is Amex Shutting Down People With Airline Incidental Clawbacks?
I have seen a couple of scary data points in terms of Amex shutdowns. There have been a couple of people that got entire account shut downs and the common thread between them was airline incidental credit clawbacks. But it is just a few data points so we need more. If anyone has been shut down for something similar over the last few days let us know. The accounts have been locked out and points have been confiscated American Airlines style.
Details & Data Points
The Miles Per Day reader recently closed a Charles Schwab Platinum card and assumed that may have put eyes on their account. They also said they had 9 charge cards which I thought may be the issue with American Express’ recent change even though they were under the new 10 card limit. I had figured this would be the area Amex would crack down on next. But then they said that they had around $2000 in airline incidental clawbacks. Vinh thinks this is what caused it and I agree with him.
The post from drakiez on Reddit kind of confirms this theory. They said they had a few airline incidental clawbacks in the last year. Nothing else from their data point stood out to me.
Why This Is Scary
As we all know 2020 is the year of the cancellation so it puts me on edge a little bit. And even if some people were gaming the airline incidental credits I made the point that many had flights cancelled etc. and the clawbacks were in poor form. Well guess what, a ton of people have had cancellations in 2020 – myself included.
I had selected Frontier as my airline and used my airline incidental credit on seat fees for a trip to Vegas. Those flights were cancelled and I filed a charge back to get my money back because Frontier was only offering vouchers, against DOT regulations. I received the charge back but that means I got a double credit for my airline incidental. Now I don’t have an issue if they claw that back but reset my meter. Something I don’t think they have the capability to do. But what if they continue this trend and shut me down because of it? I would have said no way a few years ago but Amex is now the least predictable lender out there.
Should We Move Membership Rewards Out Of Our Accounts?
This begs the question, should we play offense? If you have had airline incidental clawbacks should you move your points out now in fear of a shutdown? Even if it was a legitimate cancellation I don’t know that it matters at this point.
If you have a currency you use most of the time etc. or normally cash out via the Schwab Platinum at 1.25 cents a piece I would strongly consider it. American Express confiscates the good with the bad during these shut downs. One of the posters said they just paid taxes from referrals on points Amex confiscated, talk about rubbing salt in the wound.
This seems to be an extreme overstep on American Express’ part if it is in fact because of airline incidental credits. They already recouped their money and sent the warning. They collected an annual fee for a perk that was not use, instant profit. Amex made it known where the line was drawn in the sand. But then they shut down people on top of that and take back all of their points as well. Is this in response to their poor quarter one showing and looking to cut costs?
Hopefully we can get a few more data points to see if it is for sure the airline incidental clawbacks that are causing this. Then we can all bite our nails for the rest of 2020 as we see flight cancellations, that are out of our hands, pile up and hope Amex doesn’t take advantage of it to clean their books.