Creation Financial Services bashing

[Lady London]

@jj Thanks for your post just above.

What you’ve said is the essence of why Creation needs to be not let get away with this. It’s the abuse of consumers by powerful institutions who have deliberately abused them and Creation has cynically taken a path of steps to deter pursuit against them.

I hope they rot but as @JDB says, the FOS has far stinkier fish to fry and sadly hasn’t the b*lls to propose to the FCA that Creation’s permissions to operate in the UK be revoked. Creation has a number of other longstanding product lines (they used to run the store cards for Selfridges, Harvey Nicks and Liberty for example, though I don’t know if they still do) and I don’t believe Creation’s other products have troubled the FOS unduly.

[jj]

Lady London, in my FOS complaint, I stressed that a large number of people had been similarly affected, and I directed their attention to a report by the Consumer Association as evidence. I noted that few others would be able to articulate their complaint by reference to FCA principles, rules and guidance, and few of those affected would complain to the FOS. I pointed out that it would be unfair for consumer ignorance or indolence to allow Creation to profit at its customers’ expense, and asked the FOS to ensure that, if they upheld my complaint, they would ensure all others were treated similarly regardless of whether they had complained.

A little part of me likes to think that I have played some part in the FOS treating all of these complaints together.

[points_worrier]

JDB wrote:

@jj I didn’t say Creation’s actions were reasonable, but I maintain that many of those whose accounts were closed were acting in a way that most people would consider improper and that no financial services professional should consider appropriate or acceptable.

@JDB, you normally are so clinical. Highlighting what the law/terms actually say, not what people ‘reckon’ or feel should be right. Why not so here? There are abuse terms creation could have used, but clearly chose not to. In the absence of this, I suspect the law/terms are likely to be relatively clear, irrespective of whether people used their cards as you view improperly or not.

[JDB]

points_worrier wrote:

JDB wrote:

@jj I didn’t say Creation’s actions were reasonable, but I maintain that many of those whose accounts were closed were acting in a way that most people would consider improper and that no financial services professional should consider appropriate or acceptable.

@JDB, you normally are so clinical. Highlighting what the law/terms actually say, not what people ‘reckon’ or feel should be right. Why not so here? There are abuse terms creation could have used, but clearly chose not to. In the absence of this, I suspect the law/terms are likely to be relatively clear, irrespective of whether people used their cards as you view improperly or not.

As highlighted in the MCOL case reported extensively above, the law isn’t as clear as some suggest – there were lengthy arguments on both sides and some of Creation’s submissions must have resonated with the judge or he would certainly have given a quick decision after the submissions/questions. I understand also that some cases have been lost in additions to a number of wins. The FOS may give a better result as they have different powers and can consider conduct issues.

Re “clinical” my point all along is that, as with most things, there are two sides to this argument, so I am astonished that @jj as a senior financial services professional tacitly endorses the conduct of the people who initiated this whole debacle, ie a certain cadre of cardholders who openly boasted of ripping off Creation for £millions and encouraged others to join in the fun. No firm should suffer that.

Yes, Creation’s clumsy response, made in anger rather than professionalism was very shoddy and unacceptable conduct. However, those people who were abusing their cards and the resulting closures, including for some innocents who were caught up in the process should not be seen as heroes or victims. They caused lots of uninvolved accounts to be closed prematurely, they have directly caused the imposition of cash advance fees by Virgin, HSBC, changes at Revolut and Curve etc. as well as greater surveillance; people seem rather reticent about admitting account closures.

Finally, the extreme criticism and chasing of the FOS for not considering these cases and maybe awarding certificates/points quickly enough feels rather entitled. The organisation is, like many financial institutions, struggling with staff shortages at a time of increased workload. They have a mountain of cases, eg considering the British Steel workers whose pensions (ie their life savings) have been destroyed by predatory financial advisers and other terrible transfers out of defined benefit schemes. I am helping people with two (non pension transfer) cases worth about £15k and £140k which for both parties are life changing sums. These and many other cases are correctly prioritised over hotel nights/points. It is clear also that there are discussions going on between Creation and the FOS which will no doubt be complicated and thus take time. It’s in everyone’s interest that these talks take place. Despite all its failings, we are actually very lucky compared to other countries to have a free, impartial service to resolve these matters.

[Colin MacKinnon]

+1 to @jdb

Points collecting is about fun, and I like the way our reporter or his court case said he did it partly for the experience.

That’s why I am happy to wait for FOS, it’ll be fun hearing what they say and how it turns out.

I’ll act annoyed if it doesn’t go my way, but really – in the broad picture of life – it doesn’t matter one bit.

[Jon]

@Colin MacKinnon Exactly. I think if I’d felt I had been taking the p*ss or abusing the card etc (as presumably some did), I’d have let it lie, but as innocent collateral damage I felt there was a principle at stake, and also a useful learning experience, hence I pursued it. Thankfully I had the time and inclination and, a few moments of frustration aside, I enjoyed it (especially the hearing actually, when sparring with counsel was quite good fun, I thought!). I do agree with @JDB, but also with @jj’s point about balance. It’s unfortunate that while there were presumably a few hardcore card abusers, there were some (many?) of us who got tarred (by Creation) with the same brush. I daresay if Creation had held its hands up at the beginning and said “Look, we were trying to put an end to the abuse, sorry to those of you who got caught up in it, we’ll fix it,” we might not now be on page 54 of this thread… 😉

[Rui N.]

So, when you do anything for fun you do not care about the way you are treated, if you got what you paid for, etc.? Very weird.

[Lady London]

And for the infinitesmally small number of clients who might have been perpetrating clear provable abuse, Creation had the tools at their disposal to terminate those particular accounts in a legitimate way. Yet they as an institution far more powerful than their consumers, did not do this. Instead they treated a much larger segment of their customers unfairly, which is far more important than the contract terms they also breached.

Creation are not babies but grown up and should be accountable, make good on the contract breaches they decided to just bully their way through, treat the group of customers they tried to treat unfairly, fairly and in terms of their presence in the financial services industry in the UK, need someone with a bigger stick than their consumers to tell them to clean up their act.

[memesweeper]

When I took things up with Creation I was annoyed. I thought as a company they should do better than lash out at all their customers, rather than the handful that had abused their incompetence. I decided to threaten to take action, and then take it. I expected to be compensated without too much of a fight.

Given what’s now transpired — most affected people having taken no action, and there’s no sign of all the affected people being compensated — I’m of the opinion something better/bigger needs to happen. I’ve worked for organisations with less than perfect morals and/or compliance standards, but in all of them to just trample over published T&Cs and knowingly and systematically breaching contracts would have been unthinkable.

Sadly I think JDB is right in one respect, they’ll push back and could win the long game — paying out a small minority at FOS and MCOL is cheaper than doing the right thing for all the affected customers. What proportion need to fight back to swing the maths on this? Presumably more than 10%. But I don’t think the execs at Creation give a stuff about how much they’ll loose in legal fees and compensation. I doubt they are tracking that, nor do I think they made a balanced decision against the cost of points and free nights they needed to pay out. This wasn’t a planned approach to dealing with the manufactured spend problem is my guess. What proportion need to fight back to make the regulator(s) take action? I have no idea.

Given the company has zero interest in gathering new customers normal market pressures don’t apply either. I despair.

And I still don’t have a court date, and I lack the time and headspace to push forward on this in the way I know I should.

@jdb said @jj I didn’t say Creation’s actions were reasonable, but I maintain that many of those whose accounts were closed were acting in a way that most people would consider improper and that no financial services professional should consider appropriate or acceptable.

Absolutely — and I met one such individual in a hotel bar. His actions were a klaxon on top of a flashing red light in terms of requiring a source of funds and a KYC check as well as being closed down for any number of reasons by Creation. They did nothing, as far as I know, until they acted against everyone using Curve. The fact they could not discern his actions from legitimate customers is evidence of a massive failure of compliance, never mind operational incompetence in running a financial services business.

@jdb said Finally, the extreme criticism and chasing of the FOS for not considering these cases and maybe awarding certificates/points quickly enough feels rather entitled. The organisation is, like many financial institutions, struggling with staff shortages at a time of increased workload.

You argument @jdb is the inverse of people who are pulled over by the police for traffic offences and complain about the police not having something better to do (which they probably do). FOS is now being clogged up by Creation. If FOS has something better to do but can’t because of these complaints the blame lies with Creation. Let’s not start blaming those that have complained. Outlining your right to complain to FOS is about the only correct thing Creation have done in this whole sorry tale. It’s hardly a surprise that people have done so, and then been disappointed by an abysmal service.

And yes, I am pleased and grateful to live in a country with well regulated systems, fair courts and the rule of law. Creation has no place to operate in such a landscape.

[Supergers49]

memesweeper wrote:

When I took things up with Creation I was annoyed. I thought as a company they should do better…

Absolutely all of this is how I feel about the subject.

[jj]

Most people taking advantage of the Creation/Curve points bonanza did no more wrong than the many families who bought a Hoover for £100 in 1992, tossed it in the bin, and flew to the States at Hoover’s expense. They saw a good deal and grabbed it. Creation offered a product with unlimited points-earning capacity, naively hoping that no-one would use it to the full. Some did, and Creation’s fingers were burned.

Curve is still advertised as a product that can earn you points as you do things like topping up savings. Curve prohibits cash recycling, so recyclers certainly behaved improperly. But it was Curve’s rules they breached, not Creation’s, so Creation has no cause for complaint. They, like Hoover, created an unlimited product making assumptions that few, if any, borrowers would fully exploit it. It’s their fault, not the punters, that things went wrong.

If Curver were taking firm action against recycling, I would be much more sympathetic. At least they defined their boundaries, even though they didn’t enforce them.

[JDB]

jj wrote:

Most people taking advantage of the Creation/Curve points bonanza did no more wrong than the many families who bought a Hoover for £100 in 1992, tossed it in the bin, and flew to the States at Hoover’s expense. They saw a good deal and grabbed it. Creation offered a product with unlimited points-earning capacity, naively hoping that no-one would use it to the full. Some did, and Creation’s fingers were burned.

Curve is still advertised as a product that can earn you points as you do things like topping up savings. Curve prohibits cash recycling, so recyclers certainly behaved improperly. But it was Curve’s rules they breached, not Creation’s, so Creation has no cause for complaint. They, like Hoover, created an unlimited product making assumptions that few, if any, borrowers would fully exploit it. It’s their fault, not the punters, that things went wrong.

If Curver were taking firm action against recycling, I would be much more sympathetic. At least they defined their boundaries, even though they didn’t enforce them.

@jj the Hoover promotion was a public offer that was ill conceived and one not subject to financial services regulation. What happened at Creation was totally different – certain people spotted that Creation’s systems failed to differentiate between ‘cash advances’ and ‘standard purchases’ so that points were also erroneously awarded. Clearly a complete bonanza. However, people clearly recognised this was a windfall that shouldn’t have been coming their way and resorted to ridiculous code words to protect their points printing project, yet they couldn’t resist the temptation. They then got too greedy and boasted too openly so the whole thing came crashing down and quite a few innocent people also had their accounts closed. The fact that someone inadvertently leaves a ‘door’ open doesn’t oblige anyone to take advantage in the manner they did. I am not sure how you would feel if your firm made an error that allowed it to be ripped off for £millions? I am astonished that you find the extreme MS, cash recycling etc. anything other than expedient. Maybe I am just too old fashioned, but I was taught at home, at school and in a long professional career the importance of ‘doing the right thing’ and that reputation and probity were critical to one’s individual success and that of the firm and that we would only deal with clients that shared these values. That may sound boring to some, but stood us in very good stead, with some very big clients/fees turned away in the short term that blew up (£15m penalty/restitution) for those who could not resist.

I understand why, on this site, you may prefer to run with the fox, but clearly our definitions of ‘doing the right thing’ are very different given your Hoover analogy and tacit approval of the abuse Creation suffered; it is simply not a one sided situation. Both sides have behaved badly.

[memesweeper]

@jdb maybe some on one side or another behaved badly. But only one side failed in their legal obligations to their shareholders, failed in their compliance with legally binding AML checks and are now breaking contracts. There is no equality of wrongdoing when one party consistently ignores the law.

Incidentally I was AML (source of funds) and KYC checked by Curve (and I suspect they wanted to check I wasn’t recycling money for points, which I wasn’t). All passed. This stuff isn’t hard to do, they just didn’t do it.

@jdb you seem to see evidence of wrongdoing on the part of some Creation customers as some reason to sympathise with Creation. I see their failure to spot the behaviour as evidence of Creation’s recklessness and incompetence and certainly not a reason to be sympathetic.

[JDB]

@memesweeper I haven’t suggested sympathy for Creation but I think it is quite wrong and lacks balance to suggest that one side were saints and the other sinners. It’s more complicated and I accept that what I think many would consider dodgy behaviour by cardholders should not be met with equally dodgy behaviour. I note also that if Barclaycard or Amex close your account on two months’ notice (or immediately) they will also both cease to award all benefits from the date of cancellation, not closure and only Amex provides for this in its terms. Not sure about others, but BC is by far the largest credit card provider in the country. Thus @jj’s suggestion that Creation’s actions are so unique and heinous is misplaced.

[memesweeper]

I think it may be time for bed for us both @jdb…

https://xkcd.com/386/

[Lady London]

“Outlining your right to complain to FOS is about the only correct thing Creation have done”

@memesweeper haha the only reason Creation signposts FOS is because they are obliged to do this under UK rules for financial services providers

[Jamjaw]

JDB wrote:

I am not sure how you would feel if your firm made an error that allowed it to be ripped off for £millions?

You think Creation lose out to the tune of £millions? That would be hundreds of millions of pounds of manufactured spend. Not a chance in hell. Maybe a few thousand pounds, but unless you know more about their contract with IHG and the amount they pay for individual points (maybe they bull them in chunks, were looking like running out of them so just turned off loads of accounts) then I highly doubt the cost of this to Creation.

They have acted unfairly (towards me at least, no MS) and the FOS taking over a year to further the claim is also not acceptable – if they do not have capacity, tell me that – don’t send me one message in the year and think that is ok.

[Flying Moonwards]

JDB wrote:

@memesweeper I haven’t suggested sympathy for Creation but I think it is quite wrong and lacks balance to suggest that one side were saints and the other sinners. It’s more complicated and I accept that what I think many would consider dodgy behaviour by cardholders should not be met with equally dodgy behaviour. I note also that if Barclaycard or Amex close your account on two months’ notice (or immediately) they will also both cease to award all benefits from the date of cancellation, not closure and only Amex provides for this in its terms. Not sure about others, but BC is by far the largest credit card provider in the country. Thus @jj’s suggestion that Creation’s actions are so unique and heinous is misplaced.

This is not correct as regards BC. If you get two months’ notice the benefits continue to be awarded until the closure date.

[Lady London]

The point of notice is that what’s been agreed ie in the card agreement, continues until the emd of the notice period, during which the agreement/ contract is still in full force.

I am at a loss to know why anyone thinks that if one card provider has a different contract allowing early withdrawal of benefits then this excuses some other random provider from continuing to fulfill the contract they made, during any notice period including all benefits.

[secretsquirrel]

My creation Ihg card still shows active on my credit file after being closed over a year ago with them.
Can anyone recommend what I need to do to get this card officially closed as creation cs keep fobbing me off?

[wideboys182]

secretsquirrel wrote:

My creation Ihg card still shows active on my credit file after being closed over a year ago with them.
Can anyone recommend what I need to do to get this card officially closed as creation cs keep fobbing me off?

This is interesting because IHG still sees me as a credit card holder

[NorthernLass]

I think everyone still has that on their account! I don’t think IHG has any link to UK credit files, though.

[SteveJ]

secretsquirrel wrote:

My creation Ihg card still shows active on my credit file after being closed over a year ago with them.
Can anyone recommend what I need to do to get this card officially closed as creation cs keep fobbing me off?

You need to raise a dispute via the credit bureau in question. They’ll then take it up with Creation directly.

[HughM]

My IHG One account shows Diamond membership ended on 31 December 2022. That is a consequence of Creation’s pulling of the Premium black card, on which my diamond membership depended. My IHG One account also correctly records that I am still an IHG credit card holder (my free, White IHG rewards card, also from Creation, was never linked to Curve and remains usable). The card linked to my IHG one account is the Creation black card, closed by them but showing a credit balance, a claim now referred to FOS. That card also says: expires 01/24. Question: am I likely to retain Diamond this year? The white card used to equate to gold, but my IHG One account does not mention that. The milestones for 2023 are now there. Has anyone’s 2023 status (based on a card) been clarified yet?

[JerrySignfield]

Jamjaw wrote:

You think Creation lose out to the tune of £millions? That would be hundreds of millions of pounds of manufactured spend. Not a chance in hell. Maybe a few thousand pounds, but unless you know more about their contract with IHG and the amount they pay for individual points (maybe they bull them in chunks, were looking like running out of them so just turned off loads of accounts) then I highly doubt the cost of this to Creation.

Creations IHG Black Card was broken from the start, to pay off the credit card Creation allowed the use of a credit card which they most likely had to pay out their 0.3% which is completely bizarre and wiped out any revenue they would have received from the Interchange fee. They were paying 2 points on the black card IIRC, its been mentioned they must have been paying 0.3p per point or similar to IHG so thats 0.6p per £1 spent aka 0.6%, so they were losing £60 for every 10k spent, so after 16.5k spent thats the annual fee wiped out and they would be losing money after that as well as having to pay out the free night certificate (£XXX?)

They were either confident that they would make money from interest balances or just completely incompetent at designing the product in the beginning and thinking of a worst case scenario, they now seem to think its ok to blame the consumer for their incompetence regardless of any MS or not.

I highly doubt that any NSI or similar deposits reached close to 166m in transactions which would equate to a £1m loss, in fact I would be surprised at a figure of 10% of that.