I canceled my hotel room but American Express refuses to refund my points

Mary Lee Keane’s case against American Express should have been a slam dunk. Instead, it’s a “case dismissed.”

I still can’t figure out why. Maybe you can help.

Keane used American Express points to make five hotel reservations recently. “I intentionally paid more points to have cancellable reservations,” she explains. “And I did cancel one of the reservations.”

Now, American Express won’t return her points.

“Amex’s system requires that Amex debit the consumer for the points,” she explains. “Amex then charges the Amex card for the room, then immediately credits the Amex card for the room. Amex says it fulfilled its obligation by giving me the dollars back — which they did on the day I initially made the reservation, not when I canceled it a month later — and that they have no obligation to return the points.”

Problem is, she can’t figure out where Amex discloses that little detail in its terms.

That was the first thing our advocacy team tried to find. If Amex can simply pocket its points, where is that stated? Indeed, section 8 of her agreement says the following:

8. Redeemed Rewards are not refundable, exchangeable, replaceable, redeemable, or transferable for cash, credit other Rewards, or Points under any circumstances.

But we also said to ourselves, “This couldn’t possibly mean what we think it means.” Why would Amex even offer a refundable room if her points were not refundable? Makes no sense, right?

But as this case unfolded, we came to understand that it does, indeed, mean that. Here’s the response she got back from American Express just before our advocates jumped in to help:

Sorry for the delay in our response. Yes, you did pay for a refundable hotel reservation but since Membership Rewards Points are nonrefundable the cash value was credited back to your account in the amount of $215.05, not the Membership Reward Points value.

In most cases American Express Online Travel will work with you to get the points refunded to you [sic] account. They will have to charge back the cash refund you received of $215.05 before they can refund the Membership Rewards Points back to your account.

In other words, American Express charged her card for the hotel, debited her points, refunded the money and then kept her points — even though she canceled her stay.

Related story:   Is it time to regulate frequent flier programs?

How is that fair?

It isn’t. But then, those points don’t even belong to Keane.

Points accrued in any Program account do not constitute property of the Cardmember and are not transferable by operation of law or otherwise to any person or entity and can not be transferred to any other Program account.

Sigh.

Our team spent a lot of time contacting American Express and despite repeated assurance that this would be addressed, it never was. Of course it wasn’t; all they’d do is reiterate their own rules, which say points don’t get returned.

So why am I writing about this case if it can’t be fixed? Because I think we can all see that this system — where the company does whatever the hell it wants with your hard-earned points — is unfair, morally wrong, unjust, unethical and just plain stupid. How can anyone defend this?

And, knowing this, how can anyone participate in this kind of scam?

Oh, I know. You think you can outsmart them. But remember, Amex reserves the right “to change the program terms and conditions at any time” — which is a lot like playing cards with someone who can print any card he wants during the game, and it’s all perfectly legal.

Wake up, people. American Express has rigged the game, and there’s only one loser: you.

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Christopher Elliott

Christopher Elliott is an author, journalist and consumer advocate. You can read more about him on his personal website or check out his adventures on his family adventure travel site. Contact him at chris@elliott.org. Read more of Christopher's articles here.

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