American Express RAT Cracking Down On Closures Within 12 Months

The American Express Rewards Abuse Team (RAT) seems to be cracking down on people who have closed credit or charge cards within 12 months of them being opened. The terms on American Express cards state (emphasis ours):

If we in our sole discretion determine that you have engaged in abuse, misuse, or gaming in connection with the welcome offer in any way or that you intend to do so (for example, if you applied for one or more cards to obtain a welcome offer(s) that we did not intend for you; if you cancel or downgrade your account within 12 months after acquiring it; or if you cancel or return purchases you made to meet the Threshold Amount), we may not credit <the bonus> to your account.

Previously American Express has really only clawed back the bonus if people cancelled within the first few months, usually people that do that are doing so to get the annual fee refunded as well. But we received a report from a reader who had the bonus clawed back because they closed the account after holding it for 11 months, before the second annual fee post.

Data points

What This Means

Keep in mind American Express will refund the annual fee completely if you cancel the card within 30 days after the statement in which the annual fee hits. So your best bet would be to cancel within this period, after your one year anniversary is up.

Final Thoughts

I think what some time happens with American Express is that if you do something they don’t like, they will go through all of your accounts and bonuses to try and find a reason to deny you the sign up bonus, or claw back a bonus that has already posted. It’s not clear if this type of claw back will automatically occur if you close within 12 months, or if this is more of a targeted clawback due to other issues. This isn’t necessarily new, but it seems they are being more strict on the shut downs. We’ve posted about this issue previously here. Please share any recent data points you have in the comments below.

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SamL
SamL

Clarifying datapoint: There is no need to wait for the annual fee to post. After the card reaches 12 months old (but before AF posts) it is safe to close, without any adverse action, at least that’s my experience.

T
T

On the flip side there’s no down side for the AF to post then cancel within 30 days since you can always transfer credit to a different card or cash out via check

SamL
SamL

The point of the datapoint is to pinpoint when you can cancel without bonus forfeiture. Once it hits 12 months, you’re good to go. There’s no need to wait for the AF to post. Personally I’d rather be done with it ASAP, and I don’t want an AF to post, even if it’s >99% likely to be refunded. That’s just unnecessary time and aggravation. But others can choose that route if they want.

SamL
SamL

My AmEx PRG is 12.5 months old, and the statement just closed, but the annual fee hasn’t posted yet.

Is it safe (i.e. avoiding sign-up bonus clawback etc) to close this AmEx PRG now, since it is >12 months old, or do I actually need to wait for the annual fee to post first and then cancel the card (and get AF refund)?

SamL
SamL

Update: closing after 12 months, but before AF posts, is safe.

tc
tc

I signed up for two cards within a few months of each other (hilton and marriott) never had them before, no message on app that I was ineligible for welcome bonus. They denied both after meeting minimum spend requirements, one rep said I was trying to game the system by opening two cards? Another said I was gaming the system because years ago I closed my green card within a year of opening (I didn’t find it worth the AF, and had moved on to a better card, but it had no welcome bonus). One rep said I needed to call Marriott, that they denied it (I did try that)… I finally gave up. If it matters I have had an everyday card with them for a few years before this, I got that sign up bonus, but that was a long time ago, 10,000 pts I think it was.

Cameron
Cameron

I got this. I closed before 12 months, but all my spending was legit. I dont see any evidence of clawback on my account so far.

“We are writing to let you know that, unfortunately, you are not eligible to receive the Welcome Bonus for the Hilton Honors American Express Business Card.

Activity on your account indicates an effort to reach the Welcome Bonus spend requirement in a manner that is not consistent with the terms of your Cardmember Agreement.

Please recall that the “How Your Reward Program Works” section of the Cardmember Agreement states:
“If you violate or abuse this reward program, you may forfeit some or all of your points.””

dan
dan

As per @Brian K’s comment, it seems like they cannot claw back partner bonus points, all they can claw back is Amex points.
Can anyone confirm this is the case?

Jags
Jags

I don’t know if they claw back sign up bonuses from partners (may be against their contract with the partners) but I do they are are capable of sucking points out of partner accounts. About 2 years ago when I was earning a 25k SPG bonus they somehow deducted 25k + the 3k spend points from my SPG account instead of adding it. It took 3 months to get it fixed. All I got was a $25 statement credit for the inconvenience.

Cliftonmcdnl

Last week I closed my Hilton Business card without thinking because I was trying to get approved for the Hilton Aspire and they said they can approve me, I just needed to close another card first. I had the Hilton Business card for just under 8 months. Do you think I might have a good case against them clawing back the points in the future since I closed it to open a different Hilton card?

Dan - Legal Bank Robber
Dan - Legal Bank Robber

The level of ignorant entitlement in these comments is disgusting. Amex does owe me, you, or anyone else SHIT. Don’t blatantly abuse their system and you will be rewarded. The 5 CC slot argument is a load of BS. 5 is plenty for a year, things could be much worse and Amex could tighten up approvals and stop allowing people to get as many cards as we currently do. Everybody loves to complain, when Amex is one of the most consumer friendly in terms of SUB’s and Rewards Earnings.

Brian K
Brian K

I have an interesting situation I posted about on the last RAT thread. I signed up for two Amex Hilton cards (one personal, one biz) in November and closed them in February to clear room to apply for more cards. I never cancel within one year, I totally blanked that I was doing this. They sent me an e-mail saying I violated the terms of the sign up bonus and tried to claw the sign up bonus back, but I had already used the Hilton points to reserve a room for next year. I am left with a balance of 75,000 points, none of which they clawed back. The sign up bonuses were 150,000 and 100,000 points, I believe.

The #1 lesson is don’t close within a year, but maybe with partner cards like Hilton it’s possible to avoid claw backs by spending the points.

Charlie
Charlie

Avoiding the clawback by spending the points might be the least of your problems. You are probably now banned from future signup bonuses.

James B.

The general consensus now is to hold onto Amex cards for a least 1 year and wait for the annual fee to hit, then make a decision whether to close the account or pay the annual fee.

dan
dan

Please see my comment I just posted. Do you think they are unable to touch anything that’s non-Amex points?

AJ
AJ

Do we know how many years back they could go to claw back? Can they claw back if card was closed, let’s say in 2016? How they inform the claw back on already closed account?

Ann
Ann

I don’t know what the maximum time is, but a quick search found one case where they went back 1 year 2 months: https://old.reddit.com/r/churning/comments/5u3eap/dp_amex_clawed_back_a_total_of_175k_in_bonuses/

Alys Holden
Alys Holden

I thought it was just me. I did the upgrade offer twice in the last three years.

AmEx did NOT give me the bonus. I chatted and they kept saying I had to upload documents. I kept uploading documents. The bonus never came. Finally, I called and was refused the bonus.

I don’t understand.. AmEx targeted me for the promotion.. told me to upgrade for the bonus.. I met the qualifications.. and now they are denying me the bonus!???? How is this possible.. just because of one line of small print?

What pisses me off is I spent almost $60 in foreign exchange fees as I was using it overseas. But I did so expecting the bonus.

This makes me never want to do business with American Express ever again.

Anyone else?

dan
dan

complaint to CFBP; if no help there, seek for an arbitration

Gadget

Alys Holden Para. 3 – “one line of small print” can mean all the difference. You can’t avoid a line of text because you think it’s insignificant.

Silly question, but what would you upload? Obviously they have the transactions. So, upload the offer? So essentially they are saying they don’t see you as someone they are targeted, and not qualified for the offer?

But I am guessing they are accusing you of “borrowing” a targeted link? Or, saying you weren’t eligible because you were doing it again?

What I am taking away is to take many screenshots, save e-mails, and be ready to fight. Or, instinctively just not do offers that you know you have done before. GL!

Alys Holden
Alys Holden

At first they said there was no record what-so-ever of the promotion ever being attached to my account. And I told them that I had screenshots of every step from being shown the promotion targeted to me, to every step of the upgrade progress. I was told this story by AmEx three times. Then they changed their story the fourth time I called, to the one I mention above in my first comment.

I’ve been with AmEx for 15 years and I don’t do any manufactured spend or anything like that.. the only thing I’ve done is accepted two targeted upgrade offers.. and the last one I downgraded before the 12 years.. and honestly I didn’t even know that wasn’t allowed. so that’s why I would like them to try to make an exception this time otherwise I probably will need to file a complaint and see where it goes. This is a shitty way to treat a loyal customer of 15 years.

Gadget

Well, thank you for clarifying. But if it was in the terms not to downgrade within 12 months, then.. that’s part of the deal. Just like you expected X number of points or dollars, they expect X months of account. As someone said, I suppose you can ask for arbitration. I have no clue how that works, as I have never known anyone to do it. I can envision it as a telephone conference with a disappointing outcome.

But, banks don’t have to make an exception. And, the loyalty bonuses don’t exist, hence why we are all here trying to find loopholes and reading about bonuses.

James B.

Which upgrade offer did you receive from Amex?