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Creation Financial Services bashing

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  • JDB

    @JDB You mentioned a case DRN 2242979 which said all three triggers – spend, anniversary and fee – had to be triggered. I can’t find this online, do you have a link, please.

    If you go to the FOS website and put that whole reference in to the search with no space after DRN, it will come up.

    Colin MacKinnon

    @JDB Thanks!

    Just doing my very last-minute FOS submission. I had hoped others would have posted here so as I could crib!

    But I’ll post mine in an hour or two for comments before I hit send.

    Colin MacKinnon

    Hi,

    It is long, and still under work, but here’s a taste.

    Comments good and bad welcomed!

    Product or service I would like to complain about

    IHG Rewards Credit Card number xxxxxxxxxxxxxxxxxx issued by Creation Financial Services Ltd

    This card was advertised as earning IHG Rewards points for most spend, plus a free Anniversary Night Voucher if £10,000 or more was spent on purchases during the year.

    Creation Complaint number xxxxxxxxxxxxxxxxxx

    Your complaint – what happened?

    On 30th September 2021 I was sent a short letter saying that my Credit Card Account was being closed from 3rd December 2021. There was no mention of IHG Reward points or the Anniversary Night.

    By this date, I had already spent in excess of the £10,000 required for the Anniversary Night, see screenshot dated 11th November 2021 with a completed tracker bar and pop-up stating: “On your account anniversary you will earn one free night voucher to redeem at any IHG property”.

    On 20th November 2021, the £99 annual fee was charged to my IHG card.

    No Anniversary Night Voucher was awarded before the account was closed on 3rd December 2021.

    I complained to Creation that I had been charged an annual fee for an account that was being closed a few days later, that I had not been awarded my free night certificate and that I had been unable to earn further IHG points.

    Creation replied on 28th March 2022 to say they would refund the £99 fee, but that they had ceased to transfer any earned points after the notice of closure in September and that Free Night Certificates would no longer be issued.

    Further, that “as the account was closed on 03 December 2021, we will no longer be honoring the associated rewards benefits”.

    Under the FCA’s Treating Customers Fairly “Consumer Outcomes”, Creation failed on Outcome 3: Consumers are provided with clear information and are kept appropriately informed before, during and after the point of sale.

    Their letter of 30th September 2021 made no mention of IHG points and Anniversary Night awards, and their intention not to honour these commitments.

    Creation also failed on Outcome 5: Consumers are provided with products that perform as firms have led them to expect, and the associated service is of an acceptable standard and as they have been led to expect.

    Creation’s monthly statements and web site continued to indicate at least as far as 11th November 2021 that the Anniversary Night had been earned and that IHG points were still being awarded for suitable spend.

    Under the FCA’s Principles for Business, Creation has failed to act with integrity here – Principle 1.

    Under Principle 6, it has failed to “pay due regard to the interests of its customers and treat them fairly” by failing to adhere to its terms and conditions and marketing literature.

    Under Principle 7, it has failed to “communicate information to them in a way that is clear, fair and not misleading”. Creation misled me by continuing to display the Free Night Tracker completed on the web site login page even though it had decided not to honour this.

    Under Principle 9: Relationships of trust. Creation failed to deliver what had been promised in terms and conditions and in marketing and advertising literature, in particular the Anniversary Night Voucher.

    Finally, I would also draw attention to FOS decision DRN2242979. This was a similar case of a Creation customer failing to receive a “free night”.

    In his judgement, the ombudsman referred to the card Terms, which stated:
    “On the anniversary of your account opening. So long as your account remains active. You will earn one free night voucher … provided you make annual purchases totalling a minimum of £10,000”.

    He then stated: So under this scheme Mr G wouldn’t receive a free night until the year was up and he’d paid a new annual fee.

    I would say, unlike Mr G, I had activated all three triggers: I had spent at least £10,000 during the card year, I had reached my anniversary and I had paid the £99 fee Creation billed me for in November 2021.

    While Creation later agreed to refund me the £99 fee, this was only after they had rejected my right to a free night, a hotel stay which would be worth substantially more.

    I enclose the Terms and Conditions,

    What have you been offered – financially or otherwise?

    I was refunded the £99 annual fee for 20th November 2021 – 19th November 2022 since the account was closed on 3rd December 2021.

    Creation refused to issue the free night certificate earned for the year November 2020 to November 2021, and refused to issue any IHG points for relevant spend since 30th September 2021.

    How would you like the business to put things right for you?

    I am unconcerned about the handful of IHG points missed.

    I would like Creation to issue a free night voucher, since the IHG Rewards card product is still in use. Alternatively, I would like financial compensation to allow me to book a suitable room for cash (to be defined)

    EwanG

    A couple of comments Colin.
    1) the closure letters were issued at the beginning of September. This is because Creation needed to give 60 days notice (firms work on a 60+2 day basis, to account for postage time). So if you didn’t receive your letter until the end of September, the notice should take effect from then. How you prove such is tricky though!
    2) when is your anniversary? Presumably Nov if the new fee was charged then. I think you should clearly state that date in the letter, also the approximate date you hit the £10k spend. Creation did not change their terms, nor can they fob you off with the IHG terms to deny you receiving the free night, so I’d proactively address that point to avoid a get-out from Creation.
    3) My complaint also gave examples of previous hotels I used my free night at, the number of points to book them now (a range as it’s dynamic pricing) and how much to buy those points. So this attributed a cash value to the voucher.
    4) Paying the *next year* fee in Nov 21 should have no bearing on not receiving the free night, I’d adjust that wording (I know other views differ on this). Your account was still open when the free night should have crystallised and been applied, that’s far more important!

    Otherwise covers all the points I’d expect!

    JDB

    @EwanG the required notice period under CCA 1974 s98a is two months rather than 60 days. I think the Curve block was early September and the closure letters late September/early October. Two months from 30 Sep takes you to 30 Nov, plus as you say a few working days for service of the notice, so 3 Dec is fine.

    Colin MacKinnon

    Hi Ewan,
    1. Our letters dated 30th Sept, with closure on 3rd Dec. So 60 days + 2 as you say.
    2. I’m taking 20th Nov as the renewal date, since that was the date of the £99 fee. Will get the date when I spent the 10k – would have been months earlier.
    3. I’m going to take the same route.
    4. I’m relying, I suppose, on the “three triggers” case law, since it works with my timings!
    Thanks for the feedback – hopefully this all helps others.

    EwanG

    Ah yes @JDB I’m unable to count today. For some reason I had it in my head the letters were received at the beginning of Sept.
    Thanks also for clarifying 2 months rather than 60 days. Been a few years since I sent out NoVs!

    Colin MacKinnon

    My claim:

    How would you like the business to put things right for you?

    I am unconcerned about the handful of IHG points missed.

    I would like Creation to issue a free night voucher, since the IHG Rewards card product is still in use. Alternatively, I would like financial compensation to allow me to book a suitable room for cash.

    This year, my partner used her voucher to book the Intercontinental Bora Bora Resort Thalasso Spa, see attached booking confirmation with “UK CC Free Night” highlighted. We have booked a cruise to French Polynesia in August/September 2022 – booking confirmation can be supplied on request – and so would claim on the basis of another Free Night here.

    The current price for the basic room is £1164, and I have found a night on points which is 120,00 points. IHG normally sells points for 1c US$, so that would be about the same once exchanged for GBP.

    So I would ask for either £1,164 in cash or 120,000 IHG points to put things right.

    Colin MacKinnon

    Last bit from me:

    The latest IHG Creation Ts & Cs don’t actually mention points or free nights! They have Your IHG Rewards Premium Credit Card is issued by Creation at the foot of the front cover, and IHG a credit intermediary on the inside – but no mention of the rewards!

    They were accompanied by another slip headed IHG Rewards Club Premium Credit Card, Terms and Conditions, which does mention points and nights.

    For nights, it simply says: If you spend £10,000 or more on purchases during the year (not including refunds, reversals, or charge backs) by the anniversary of the date your IHG Rewards Club Premium Credit Card was issued, you will receive an Anniversary Night Voucher. So no mention of the next year’s £99 fee?

    if HfP allows, files on in this Google drive folder:

    https://drive.google.com/drive/folders/1kJ6Vwnyna0WctahMnvEnY4zKPtysc5Dl?usp=sharing

    Lady London

    @Colin your contract is individual. Doesn’t matter what ts snd cs they are running now. What applies is the latest ts and cs you had *due* notification of (ie 60 days if worsening things for you, during the period you were signed up. Or if you received no updares or amendments since sigming up, the original conditions or anything that a consumer (being the weaker party)would reasonably take as part of the terms.

    I’d quote all sums and ask for USD. Forget GBP as it will take a while before your compkaint reaches a conclusion:-)

    Lady London

    @Colin I think what you’ve dome is quite good.

    I’d open with date I opened the card.
    Then spend by years IHG points earned for your spend, and how you used the points (or examples of options where you can realistically plan to use them if not all spent). Ditto for the free night. Maybe include month or date the £10k spend was reached, in each year too.

    Do the above for each year,year by year. This shows previous performance of Creation of the commitments they agreed, and the longevity of them doing that. That’s why.I’d open with date I opened the card. Custom and practice counts. You spent on the card, they provided the items they’d committed to, in a repeating cycle month by month, yeae by year. And then they stopped. Without notice.

    Include tax on hotel cost if you’d have to pay it on a cash booking. I’ll bet Bora-Bora has a resort fee. Claim that too.

    Screenshots nice of tracker, and nice of hotel cash and points rates if you have them.

    Is there anyyhing about the fee being charged on 20Nov21 actually being charged early – was the eligibility for anything you’re owed actually completed on the following statement date? There is something in the agreement implying contract must be in force on the statement date for benefits to apply so best to be sure if you possibly can when is your Annivetsary in relation to statement date as well.

    Your phrase ‘not been able to earn further IHG points” I’d say ‘points earned (for spend made) had not been credited’.

    Can you inckude the date you complained to Creation? Them coming back on 28Mar2022 is a long time. I’d be tempted to complain about that too, but the FOS themselves is a lot worse – so I woukdn’t 🙂

    nitpicking I wouldn’t say ‘relevant spend’ but ‘spend made’

    not sure if ‘marketing literature’ but ‘infornation sheet’ or ‘literature provided informkng about the product’ – something stronger about it being a sales document that you bought on the strength of?

    I woukdn’t say you’re not interested in the IHG points – they are a bargainimg chip even if you don’t want them. To buy the points due for your spend that were stopped being credited by Creation costs money. I’d state IHG’s standard USD selling price for the amount of points earned but not credited as their value.

    Seeimg that you have the perfect 3 items ticked and how unreasonable Creation’s sudden change in actioms without notice will look once you put your final version in @Colin, warms my heart and makes me think that after consulting their lawyers December 2921 to March 2023 and doing a rearguard action of trying to separate some of the promises related to IHG out of the contract, Creation must have allocated a pot of money to pay these claims.

    Colin MacKinnon

    OK, now doing my partner’s one.

    Her year ended 21 Sept 2021, according to the annual statement (which I can’t post, since there’s lots of personal info)

    She was charged the £99 annual fee on 20 Sept 2021. Without her asking, Creation refunded this on her December statement.

    Her IHG Creation statements show 13,188 points earned in October, 0 points transferred, and 7,124 points earned in November, 0 points transferred. Total spent on card after 21 Sept: £10,183.98

    Most interesting, her online statement today can be viewed on the Google Drive folder referred to earlier. It doesn’t say her account is closed, it just say in red “Reduced Functionality”. It’s all very well telling you that your account is being closed on 3rd Dec, but then if you don’t fully close it?

    And while the Free Night tracker is at zero, the earned total of IHG points reads 20,312 !

    Since the Ts & Cs I posted don’t mention a need to have paid the £99 (unlike the case law precedent) – although she did, and it was refunded – they do say she has to have had the account for a year. And today is now the 28 Sept, so a year has passed and Creation seem to indicate that the account is still open, albeit with “Reduced functionality”!

    So I’ll be claimed for a free night for her too.

    stevenhp1987

    I can still login to my account, almost a year after it closed and it says “reduced functionality”.

    It’s just Creations’ bad IT.

    memesweeper

    I can still login to my account, almost a year after it closed and it says “reduced functionality”.

    It’s just Creations’ bad IT.

    Maybe they closed your account.

    Maybe they didn’t and blocked the card and put a limited functionality flag on the website.

    Check your credit history?

    Rui N.

    I can still login to my account, almost a year after it closed and it says “reduced functionality”.

    It’s just Creations’ bad IT.

    Not bad IT at all. If anything it’s good practice to let you still have access to your online account but to note that it has reduced functionality.
    We’ve had this “I can still access my online account so my account must still be active” wishfull thinking since December.

    stevenhp1987

    Fine, bad wording rather than bad IT!

    Either way, that wording has no bearing on the “activeness” of the card itself and it shouldn’t be relied upon with FOS.

    Yes, my account is most certainly closed on my credit report.

    Colin MacKinnon

    I can still login to my account, almost a year after it closed and it says “reduced functionality”.

    It’s just Creations’ bad IT.

    Not bad IT at all. If anything it’s good practice to let you still have access to your online account but to note that it has reduced functionality.
    We’ve had this “I can still access my online account so my account must still be active” wishfull thinking since December.

    Confuses the heck out of me, and I am your average Joe who is not meant to be confused by large financial organisations according to the FCO!

    ps. Just had a KYC check from RBS – who ask me to send a bank statement (one of theirs is suitable!) to prove my address! Maybe I should address it to Mr Kafka?

    Rui N.

    You’ve never closed a credit card before, I guess? You probably did, you just never logged in afterwards and saw the messages shown there.

    Lady London

    OK, now doing my partner’s one.

    Her year ended 21 Sept 2021, according to the annual statement (which I can’t post, since there’s lots of personal info)

    She was charged the £99 annual fee on 20 Sept 2021. Without her asking, Creation refunded this on her December statement.

    Her IHG Creation statements show 13,188 points earned in October, 0 points transferred, and 7,124 points earned in November, 0 points transferred. Total spent on card after 21 Sept: £10,183.98

    Most interesting, her online statement today can be viewed on the Google Drive folder referred to earlier. It doesn’t say her account is closed, it just say in red “Reduced Functionality”. It’s all very well telling you that your account is being closed on 3rd Dec, but then if you don’t fully close it?

    And while the Free Night tracker is at zero, the earned total of IHG points reads 20,312 !

    Since the Ts & Cs I posted don’t mention a need to have paid the £99 (unlike the case law precedent) – although she did, and it was refunded – they do say she has to have had the account for a year. And today is now the 28 Sept, so a year has passed and Creation seem to indicate that the account is still open, albeit with “Reduced functionality”!

    So I’ll be claimed for a free night for her too.

    Good.
    Serves them right.
    Keep screenshots.

    Colin MacKinnon

    I hope this is entertaining everybody! What I think is a very interesting point for the free night – hopefully well expressed?

    ***********************
    Finally, I would also draw attention to FOS decision DRN2242979. This was another case of a Creation customer failing to receive a “free night”.

    In his judgement, the ombudsman referred to Mr G’s card Terms, which stated:
    “On the anniversary of your account opening. So long as your account remains active. You will earn one free night voucher … provided you make annual purchases totalling a minimum of £10,000”.

    He added: “The investigator has explained that on their website Creation say one of the benefits of the card Mr G took out is: “a free night voucher which you can use … if you spend at least £10,000 every year by your anniversary” He says this doesn’t say that you have to wait until the anniversary to benefit from the free night and I agree.
    “But I don’t think these headline benefits have to document all the details behind the benefits. For example the headline doesn’t explain how many hotels the voucher can be used at or at what locations. These conditions like those that apply to the free night are enlarged upon in the full terms that Mr G signed and had access to. I think it’s reasonable for Creation to expect consumers to look at the terms and conditions to understand how the benefits are applied”

    My IHG Rewards Club Premium Credit Card Terms and Conditions are significantly different to Mr G’s.

    My Section 4 states: Anniversary Night Voucher.
    “If you spend £10,000 or more on purchases during the year (not including refunds, reversals or charge backs) by the anniversary of the date your IHG Rewards Club Premium Credit Card was issued, you will receive an Anniversary Night Voucher.”

    This section is the only mention of the voucher in the Terms and Conditions.

    In my version, there is no mention of “So long as your account remains active”. So Creation advising that they would close it on 03 December 2021, before the account anniversary, is irrelevant under my Terms and Conditions, but would have been fatal under Mr G’s..

    My version of the Terms and Conditions has also omitted the phrase “On the anniversary of your account opening”. It now uses the phrase “by the anniversary of the date of your account opening”.

    In his judgement in DRN2242979, the ombudsman states: “The investigator has explained that on their website Creation say one of the benefits of the card Mr G took out is: “a free night voucher which you can use … if you spend at least £10,000 every year by your anniversary”. He says this doesn’t say that you have to wait until the anniversary to benefit from the free night and I agree.

    Mr G had three triggers: spend £10,000, wait until the anniversary and pay the next year’s fee. And he had to rely on the Terms and Conditions as they applied to him.

    The Terms and Conditions as agreed with me make no mention of the £99 fee. They also are phrased such that I did not need to wait until the anniversary, according to the interpretation of the phrase “by the anniversary” by both the Investigator and the Ombudsman. And I spent more than £10,000 between the start of my year in late September and the end of November, which was sufficient according to both the Investigator and Ombudsman’s view to satisfy “by the anniversary”. So I had qualified for my free night before Creation’s 03 December 2021 closure date.

    Creation, in their final response, states that “Section 6 of the Terms and Conditions for IHG Rewards confirms that services and benefits may be added or removed at any time without notice to cardholders”.

    Section 6 in my Ts & Cs has the section head: IHG Rewards Club Information.
    It actually states, in full: “Terms and Conditions of the IHG Rewards Club may be modified without notice to Cardholders, and services and benefits may be added or removed at any time.”

    As the section headline states, this is “information”, since it refers to IHG Rewards Club terms and conditions and not to the IHG Rewards Club Premium Credit Card. It is IHG services and benefits that may be added or removed at any time – such as a restriction on what hotels can be used, or what privileges might be given to members. It is not referring to Creation Financial Services Ltd’s services and benefits.

    ********************

    Wish us luck!

    Rui N.

    Good luck.
    But makes no sense to be discussing other cases that are only tangentially related, and on top of that you even say that it is irrelevant because the t&c’s are different.

    Lady London

    Be careful.

    I think you’ve done well to point out the difference between ‘on’ anniversary date and ‘by’ anniversary date.

    There is this thing called a survival clause in Contract law I believe.

    This basically says that if they promised you, say, 3 strawberries at the end of each full 12 months’ contract, and if the contract allows them to terminate the contract ending it at a time that turns out to be a week, or even a full day before the contract has completed a 12 months, then if there isn’t a “survival clause” saying that this aspect of the contract would still take place even if the contract had been terminated earlier, then regardless of who terminated and why, they don’t have to give you the strawberries. Unfair but true.

    I am remembering old stuff but I used to have a very very good lawyer who told me this.

    IA obviously NAL but with the FOS your angle available hinges on fairness.

    So the FOS is there to ensure customers of financial products, who as consumers are the weaker party,are treated fairly. So there should not be unfair terms, and the terms shoild mot be used or operated unfairly, and the offering should not be misrepresented so that a consumer who signed up should receive what he reasonably believed he would if he signed up.

    Well spotted that the removal of services and benefits without notice appeared only in a paragraph headed IHG. I would further argue that in a consumer finance contract, that term would be an ‘unfair contract term'(as such legally can be thrown out, or possbly get the whole contract thrown out)’ if it applied to what was promised with the card (ie points earned, free night voucher) anyway as it’s unfair.

    So if you can tweak it a bit more to stay on the side of the innoceent consumer who has stopped being provided what Creation promised and (ideally) provided before, in accordance with the promises they made about the card, rather than risk the lack of a survival clause rearing its ugly head, it could be better.

    I think the survivsl clause issue may be why @JDB has always said the practice in the card industry historically is that as soon as notice has been given even if it’s typically 60 days, benefits have stopped being provided even though there is 60 days notice to run. I think this is wrong and needs sorting as unfair to consumers, but the survival thing may be how the industry was getting away with it as @JDB said they were.

    NorthernLass

    The FOS has already found in someone’s favour though, surely everyone would have been subject to the same Ts and Cs at the point the cards were closed?

    EwanG

    @Colin Acknowledging your wife has more to gain from the FOS complaint than your own case will have (because she is due the >20k points for spend, whereas the points you are due are fewer), you could consider the following:

    Your wife might want to consider incorporating is a reason why Creation could withhold the crediting of points.
    Creations T&Cs state that ‘points earned on your IHG Rewards Club Premium credit card will be suspended if you default (arrears or over limit) on your account. Once your account is back in good order, you can start earning points again.’ Was her account in default from September to December?

    I concur with @Memesweeper too re credit file – does this card account still show open against CRAs today?; are statements continuing to be generated? These demonstrate the account is ‘active’ even though the account has ‘limited functionality’. Even if not, the spend had been made in good faith and just because Creation decided to close the account at some point ‘after 3rd December’ (note, the letter did not say on 3rd December) then Creation should provide the benefits which your wife accrued, and crystallised today on 28 Sept 2022!

    EwanG

    The FOS has already found in someone’s favour though, surely everyone would have been subject to the same Ts and Cs at the point the cards were closed?

    You are subject to the T&Cs you have been provided. A bank/financial institution will use a NoV or ‘Notice of Variation’ to change these terms – this is where the 2 months (plus time to allow for postal delivery) comes from (we mentioned it here yesterday).

    If you don’t accept the NoV, you can close your account. Continue to use the card and you have accepted the new terms.

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