Creation Financial Services bashing

[points_worrier]

Jon wrote:

My hearing has now taken place. It was long (we used the full two hours and then some, not the clear-cut case perhaps many of us thought it would be). Inconclusive outcome – it will go to written judgement unless we settle first. I’m mindful that I probably can’t say much more at this stage as confidentially will be in play.

A few notes on court process though, in case it’s useful to anyone else (whether for this matter or any other).

My hearing was virtual, via Microsoft Teams. The court sends the login details out about 3 days before, although mine didn’t reach me, so I called the court the day before to get them.

Worth installing the Teams app if you don’t already have it (although it can be done via web browser if you prefer), and definitely log in well beforehand to check it’s all working and to set up your audio/visual preferences etc, especially if you’re not already familiar with the vagaries of MS Teams 😉

On the day, log in about 10-15 minutes prior, and a clerk of the court will be along to let you in and check everything’s working, then once all parties are present, the judge will join and off you go. So if the hearing time arrives and you haven’t been let in, probably a good idea to call the court and make sure they’re not somewhere else waiting for you 😉

Useful to have as much screen real-estate as you can, for the various documents you’re likely to be referring to (I had laptop, external monitor, and iPad).

In my experience, Teams can cause performance issues (and occasionally crashes) on some laptops (MacBook, in my case), so may be worth having a second device (e.g. tablet or phone) set up ready to quickly switch over to if need be (wasn’t necessary for me here, but I’ve had to in the past for business meetings).

The hearing is recorded, and I may be mistaken, but I think I saw a message pop up about auto-transcription – I might follow that up as I wouldn’t mind getting a transcript for my records, although looking at the application form for that, it looks like it’s usually done manually and there is of course a cost. If anyone knows anything about that, do share.

Feel free to ask questions, though I may not be able to answer them.

Good luck to whoever goes next! 😉 (I should probably add that court is not at all scary or anything to be nervous about, but I think perhaps being a litigant in person does create its own challenges.)

It is my understand that this is open justice. IE what you say in court is public, not private. There is no confidentiality unless the judge orders it.
You are allowed to simply repeat arguments/what was said etc. I am slightly less clear on whether you are allowed to give your opinion on the case prior to any judgement. Perhaps others could confirm?

[Jon]

@LadyLondon I thought I’d replied just now but it seems to have disappeared. Anyway – not particularly. As the hearing is a matter of public record, I think I probably can say that their line of argument was mostly around points having no value and not being property, hence I have no ownership of or entitlement to them (see Clause 24 of the IHG Rewards Club terms) and therefore no pecuniary loss and no legal basis for claim. Whereas my argument was about breach of contract, Consumer Rights Act, and the value or otherwise having no bearing on Creation’s obligation to send the points over to my IHG Rewards Club account in the first place. It did sometimes feel as though we were arguing at cross-purposes, almost as if it were two different cases 😉 There was some unresolved discussion around the applicability of the CRA, whether or not the agreement was a services contract, and whether remedy for breach can be sought.

[Andrew.]

Jon wrote:

The hearing is recorded, and I may be mistaken, but I think I saw a message pop up about auto-transcription – I might follow that up as I wouldn’t mind getting a transcript for my records, although looking at the application form for that, it looks like it’s usually done manually and there is of course a cost. If anyone knows anything about that, do share.

Do review the auto-transcription in case it has picked up odd content.

The University one that my colleague uses has real problems with his Lincolnshire accent and live auto-transcription. A straightforward introduction to freshers became “Bow to me, I am your god” on the screen.

[jj]

Jon wrote:

…their line of argument was mostly around points having no value and not being property, hence I have no ownership of or entitlement to them (see Clause 24 of the IHG Rewards Club terms) and therefore no pecuniary loss and no legal basis for claim…

That’s why it’s helpful to attack Creation through both FOS and the courts. Although a judge may regard a technical argument of this type as germane, I would expect the FOS simply to ask, “If so, why did you create and promote a product with a valueless principal feature?”

[JDB]

jj wrote:

Jon wrote:

…their line of argument was mostly around points having no value and not being property, hence I have no ownership of or entitlement to them (see Clause 24 of the IHG Rewards Club terms) and therefore no pecuniary loss and no legal basis for claim…

That’s why it’s helpful to attack Creation through both FOS and the courts. Although a judge may regard a technical argument of this type as germane, I would expect the FOS simply to ask, “If so, why did you create and promote a product with a valueless principal feature?”

@jj if your “valueless” were indeed the test, it would catch out an awful lot of firms/products as there are so many financial products that are of value exclusively to the provider. Might concern those nice people at SJP as well.

The technical arguments have to be considered by the FOS as much as the courts per DISP 3.6.4.

[ed_fly]

Fascinated to hear the outcome of the case. Personally, despite having no skin in this creation game, I think some of their practices I.e. cancelling a card weeks after annual fee charged and not offering a refund was not on. And especially for those who were using curve in a non-ms manner, so best of luck @jon

[JDB]

@Jon you have been very resilient in the face of all this and sounds as though you were able to stand your ground in the face of all their arguments which went as discussed when you got Creation’s lengthy defence – ie they fling lots of mud and hope some sticks. The one questioning whether the separate points agreement is a contract for services at all (and the consequences of that) is intriguing…

I’m not surprised the judge decided to reserve judgment with all that going on.

Hopefully you will receive a speedy and positive outcome.

[Lady London]

Jon wrote:

@LadyLondon I thought I’d replied just now but it seems to have disappeared. Anyway – not particularly. As the hearing is a matter of public record, I think I probably can say that their line of argument was mostly around points having no value and not being property, hence I have no ownership of or entitlement to them (see Clause 24 of the IHG Rewards Club terms) and therefore no pecuniary loss and no legal basis for claim. Whereas my argument was about breach of contract, Consumer Rights Act, and the value or otherwise having no bearing on Creation’s obligation to send the points over to my IHG Rewards Club account in the first place. It did sometimes feel as though we were arguing at cross-purposes, almost as if it were two different cases 😉 There was some unresolved discussion around the applicability of the CRA, whether or not the agreement was a services contract, and whether remedy for breach can be sought.

Thanks Jon.

Looking at what you’ve said objectively I think you did a better job than them. Regardless of whose value the points might have, Creation said they would provide the points and they didn’t. The value they might have is up to you not them. Though it’s odd they should be trying to say they’re worth nothing when they bothered to promote them as a feature of the card.

You’d have my vote anyway.

Trouble is, doing legal stuff as a layman is much more nervewracking because you always worry there is some technicality the other side can catch you out on.

[Lady London]

apcd2 wrote:

Emailed my complaint for missing points yesterday and added a reminder to my calendar for 8 weeks time to escalate it to the ombudsman. They’re within their rights to close accounts for any reason but I can’t imagine how they expect to defend not awarding points in the interim and without informing the customer. Hopefully a few hundred FOS complaints will focus their minds.

Or was that, “hopefully a few hundred FOS complaints at a fee due to the FOS of £750 (?) per complaint the FOS receives, will focus their minds” 🙂

[Lady London]

JDB wrote:

jj wrote:

Jon wrote:

…their line of argument was mostly around points having no value and not being property, hence I have no ownership of or entitlement to them (see Clause 24 of the IHG Rewards Club terms) and therefore no pecuniary loss and no legal basis for claim…

That’s why it’s helpful to attack Creation through both FOS and the courts. Although a judge may regard a technical argument of this type as germane, I would expect the FOS simply to ask, “If so, why did you create and promote a product with a valueless principal feature?”

@jj if your “valueless” were indeed the test, it would catch out an awful lot of firms/products as there are so many financial products that are of value exclusively to the provider. Might concern those nice people at SJP as well.

The technical arguments have to be considered by the FOS as much as the courts per DISP 3.6.4.

@JDB just seen your dig about “financial products of value only to the provider” and would love a diversion into an example or two. Especially given the rep another party you mentioned seems to have.

[JDB]

@Lady London the firm I mentioned is particularly bad, not just for the ridiculous fees which are just a very small part of the value destruction clients experience, all with the bare minimum of information provided (clients don’t even get proper valuations) so very difficult to work out what’s going on. I have helped two people extricate themselves and what had been going on and the low quality, terrible advice was a real eye opener. I tried to get some quite simple data from them as part of the second process and they responded with about 90 pages of charts. It took me a while, but I worked out what had happened and put it into a very simple one page Excel sheet and asked them to confirm the info. They refused to do so, but promptly released the client without any penalty charges and compensation agreed, albeit at too low a level, so now with FOS where caseworker has recommended double, but still hoping for more. Basically, they operate a system designed for them to be the only likely winner, however badly they perform or advise you. One day it will explode.

In general, there are a great many dire investment products particularly those offered to new SIPP people who have already received bad advice to transfer out of occupational schemes, the error of which will become increasingly apparent with high inflation and difficult equity markets eroding savings. Another area is equity release aimed at retirees which often only works in favour of the provider.

My point to @jj was that the FOS isn’t interested in the value of the product unless you have actually been mis-sold or mis-sold a product, but if you have chosen a useless / valueless product that’s the client’s lookout.

[jj]

@JDB, I agree that the FOS will generally be disinterested in value for money (although, IIRC, back in about 2007 that was the underlying basis of the FOS’s initial findings against PPI policies). But I was trying to say that a lender’s defence which effectively says, ‘I enticed borrowers to take out my product by prominently advertising vouchers and points that have no value’ carries a faint whiff of mis-selling.

[memesweeper]

jj wrote:

@JDB, I agree that the FOS will generally be disinterested in value for money (although, IIRC, back in about 2007 that was the underlying basis of the FOS’s initial findings against PPI policies). But I was trying to say that a lender’s defence which effectively says, ‘I enticed borrowers to take out my product by prominently advertising vouchers and points that have no value’ carries a faint whiff of mis-selling.

If they actually win on this basis the points have no value I’ll change my claim to “specific performance” 😀 … not to mention I’m sure they were paying IHG for these points, so that surely fatally undermines that argument?

… I assume there was no free night voucher in play? there is one in mine, good luck to them in arguing that has no value, it’s > 90% of my claim.

[JDB]

memesweeper wrote:

jj wrote:

@JDB, I agree that the FOS will generally be disinterested in value for money (although, IIRC, back in about 2007 that was the underlying basis of the FOS’s initial findings against PPI policies). But I was trying to say that a lender’s defence which effectively says, ‘I enticed borrowers to take out my product by prominently advertising vouchers and points that have no value’ carries a faint whiff of mis-selling.

If they actually win on this basis the points have no value I’ll change my claim to “specific performance” 😀 … not to mention I’m sure they were paying IHG for these points, so that surely fatally undermines that argument?

… I assume there was no free night voucher in play? there is in mine, good luck to them in arguing that has no value, it’s > 90% of my claim.

There is clearly a difference between the technical/legal value of the points/voucher and the effective or perceived value to you; that’s the point Creation is arguing and one that could go either way. They are also seemingly arguing there is no contract against which this sort claim can be made.

@jj’s valid point and one he made much earlier about the whole process is that oddly the FOS has more powers to provide an effective remedy here. I’m not sure a Court can even order production of a voucher, so it comes down to valuing it which is unlikely to give a very satisfactory outcome vs some of the numbers apparently sought. If @Jon wins or settles, you would be well advised to try and settle.

[JDB]

@memesweeper – There is clearly a difference between the technical/legal value of the points/voucher and the effective or perceived value to you; that’s the point Creation is arguing and one that could go either way. They are also seemingly arguing there is no contract against which this sort claim can be made.

@jj’s valid point and one he made much earlier about the whole process is that oddly the FOS has more powers to provide an effective remedy here. I’m not sure a Court can even order production of a voucher, so it comes down to valuing it which is unlikely to give a very satisfactory outcome vs some of the numbers apparently sought. If @Jon wins or settles, you would be well advised to try and settle.

PS you can’t just change your claim mid process!

[memesweeper]

JDB wrote:

@memesweeper – There is clearly a difference between the technical/legal value of the points/voucher and the effective or perceived value to you; that’s the point Creation is arguing and one that could go either way. They are also seemingly arguing there is no contract against which this sort claim can be made.

I would expect the court to, as close as possible, place the me in the position I would have been had the contract been carried out — assuming the court agrees this is a breach. Money is only one way of doing that, but courts generally favour damages over all other types of settlement I imagine for the ease of process and enforcement by all parties.

JDB wrote:

@jj’s valid point and one he made much earlier about the whole process is that oddly the FOS has more powers to provide an effective remedy here. I’m not sure a Court can even order production of a voucher, so it comes down to valuing it which is unlikely to give a very satisfactory outcome vs some of the numbers apparently sought. If @Jon wins or settles, you would be well advised to try and settle.

PS you can’t just change your claim mid process!

I know. I was being facetious. However, I think the court could decide to of it’s own volition if it sees no other remedy — if they suggest the points are worthless I will most certainly ask (and I’ll also ask what they pay, per thousand, for these worthless points).

[QFFlyer]

JDB wrote:

In general, there are a great many dire investment products particularly those offered to new SIPP people who have already received bad advice to transfer out of occupational schemes, the error of which will become increasingly apparent with high inflation and difficult equity markets eroding savings. Another area is equity release aimed at retirees which often only works in favour of the provider.

My point to @jj was that the FOS isn’t interested in the value of the product unless you have actually been mis-sold or mis-sold a product, but if you have chosen a useless / valueless product that’s the client’s lookout.

Going off on a huge tangent here, but this resonates – a few years back I had out of the blue contact from one of those firms who’d obviously found me via Linkedin and knew I once worked in the UK and was likely to have a deferred final salary pension (I do) – all sorts of sales tactics trying to convince me how good an idea it would be to transfer that to Australia somehow (SMSF would be the only way, since no super funds are QROPS, given we can access the $ at 60, or earlier in various cases).

I can only speculate on the outcome, as I knew in the back of my mind that it would be a terrible idea (index linked defined benefit converted to a lump sum, some time away from retirement), and that they’d almost certainly not be doing it out of the goodness of their hearts. But I could see how easily people would be sucked into things like this, especially with the promise of having all their assets in one place (and one currency, but I’ll worry about that when the time comes).

[Lady London]

Yes QFFlyer Australia is a big mistake to move these sorts of funds to from the UK,unfortunately. I remember seeing some finance industry coverage on this. Someone has however said that the adjacent country has ways and means if you qualify.

[Lady London]

Unfortunately it’s possible the mcol decision could be in two parts – and we’re hoping both will go in your favour. I think you’ve done more than enough to prove the claim of nonperformance of the agreed credit of points. However both mcol and fos, I am guessing, might then separately look at valuation, it will be interesting to see if conseq loss can play, if court will really put you in full position you’d have been in or stop at credit of the points perhaps increased by delay it has taken to get them credited, or better (but @JDB’s original loss of chance caution on this might affect this on the court side – whereas FOS might look hard at promotion, fairness and misrep).

Ethically Creation have been really unfair, I just hope it can translate to sufficient remedy at court and FOS even if they each work off different bases.

[Super Secret Stuff]

This threads been open for a year and you’re still pushing. Bravo for that!

Also very educational, I’m sad and have spent the last hour reading and it’s fascinating. Creations argument and behaviour definately seems unethical

[JDB]

Lady London wrote:

Ethically Creation have been really unfair, I just hope it can translate to sufficient remedy at court and FOS even if they each work off different bases.

By omission, you appear to imply that those who caused the account closures, including for some innnocents caught up in the process, have behaved ethically? Two wrongs may not make a right, but well publicised extreme MS…

[slidey]

Super Secret Stuff wrote:

This threads been open for a year and you’re still pushing. Bravo for that!

I expect imagining how Mr X’s head will explode from the sheer amount of fume if everyone wins vs creation would make it all time well spent 😀

[JDB]

slidey wrote:

Super Secret Stuff wrote:

This threads been open for a year and you’re still pushing. Bravo for that!

I expect imagining how Mr X’s head will explode from the sheer amount of fume if everyone wins vs creation would make it all time well spent 😀

Unfortunately, the big winner is Creation which has saved £millions having shut down a very small % of accounts. Clearing up 150 to 200 max FOS cases and maybe 50 MCOL will cost them no more than £250k if everyone won in full which is extremely unlikely.

[Jon]

JDB wrote:

Unfortunately, the big winner is Creation which has saved £millions having shut down a very small % of accounts. Clearing up 150 to 200 max FOS cases and maybe 50 MCOL will cost them no more than £250k if everyone won in full which is extremely unlikely.

Wouldn’t they have been better off if they’d just awarded the points and vouchers earned before/during the notice period and avoided this whole issue and all the associated legal fees etc? I mean, sure, if there were a handful of accounts doing obscene amounts of points in those last couple of months then they might have had grounds to withhold them, but for the rest of us… Seems to me they’ve incurred a lot of costs when it would have been cheaper just to award the points and vouchers in the first place, as they were contractually obliged to do.

Anyway, I just popped in to say that we’ve settled. A Tomlin order has been filed with the court, and I’m satisfied with the outcome. I do have a slight regret that we won’t know which way the judgment might have gone, but on balance, I think this was the right thing to do at this point. Merry Christmas everyone! 🙂

[JDB]

@Jon well done; you must be pleased it’s over and one should never underestimate litigation risk so settling on reasonable terms is a result, particularly when you suggested the hearing was difficult to read. As to would they have been better off just paying up, I think the answer is no, partly because they clearly didn’t want to reward people who had taken them for a ride as a matter of principle, but also in standing firm, they have seen off the vast majority of cases so it has saved money even if it has taken up a lot of time. A number of complainants will also lose.