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PenFed cracking down on credit card misuse with new T&C

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K-in-Boston
Credit Mentor

PenFed cracking down on credit card misuse with new T&C

Just got this little notice from PenFed:

 

 

Dear K, 

We are writing to let you know about an update that we have made to our Reward program rules, terms and conditions and wanted to share the details with you. 

What you need to know 

On November 1, 2018, the following important change will be effective for all PenFed reward credit card accounts. For your convenience, please review the summary below.

A new section has been added to the Reward program rules, terms and conditions named Account Abuse/Misuse and Fraud. This new section states as follows:

 

We may begin an investigation if evidence of account abuse/misuse or fraud is seen. Some examples of abuse/misuse and fraud include:

  • Using your Account in an abusive manner for the primary purpose of acquiring Points
  • Using your Account other than primarily for personal, consumer or household purposes
  • Point redemptions that you didn't authorize

The foregoing examples of abuse/misuse and fraud are not exhaustive, and we maintain the right to investigate in the event we become aware of any other suspicious activity on or pertaining to the account.

If we see evidence of misuse/abuse or fraudulent activity, we may investigate or take any other action we deem appropriate including, without limitation, removing the Points you earned through abuse/misuse and/or fraud and suspending or closing your Account. If we determine that you perpetrated any account misuse/abuse or fraud, we may take actions against you. These actions may include, without limitation:

  • Taking away the Points you earned through abuse/misuse and/or fraud
  • Stopping you from earning Points
  • Suspending or closing your Account
  • Taking legal action to recover Points redeemed because of such activity and to recover our monetary losses, including litigation costs and damages

If you suspect fraud on your Account, please notify us immediately by calling Member Services at 800-247-5626.

What you need to do 

We encourage you to read the updated Reward program rules, terms and conditions. in its entirety.

How we can help 

If you have questions or concerns about these changes, or any of your PenFed products, please contact us at 800-247-5626. Thank you for being a PenFed cardholder. 

Sincerely, 

John Kelly 
John R. Kelly
EVP, Consumer Banking

Message 1 of 26
25 REPLIES 25
redpat
Senior Contributor

Re: PenFed cracking down on credit card misuse with new T&C

They must have recruited some Amex RAT employees.

Personal Cards: Amex Plat | Amex Delta Res | CSR | Citi AA Exec Business Cards: Ink+ | Amex BGR
Message 2 of 26
CreditCuriosity
Moderator Emeritus

Re: PenFed cracking down on credit card misuse with new T&C

Ya got that although hard to imagine although never really been a MS person to make it worthwhile on a 2% card.  Obviously someone figured out a way to make some cash off them that got their attention though with that said.

Message 3 of 26
Medic981
Valued Contributor

Re: PenFed cracking down on credit card misuse with new T&C

Seems to be the ongoing trend in the CC rewards business.







Your FICO credit scores are not just numbers, it’s a skill.
Message 4 of 26
Anonymous
Not applicable

Re: PenFed cracking down on credit card misuse with new T&C

I wonder if this will extend to deposit account initial funding. I have done 5 initial fundings since May with my PCR totaling $3,250, the first 1k was flagged but released after verification, nothing after that. I'm about to open another batch of deposit account SUBs, hope they don't crack down on that.
Message 5 of 26
NRB525
Super Contributor

Re: PenFed cracking down on credit card misuse with new T&C

Not to put too fine a point on it, that is exactly the sort of action they will try to shut down. It is for the purpose of generating points, not just a purchase of goods or services.
High Bal Jan 2009 $116k on $146k limits 80% Util.
Oct 2014 $46k on $127k 36% util EQ 722 TU 727 EX 727
April 2018 $18k on $344k 5% util EQ 806 TU 810 EX 812
Jan 2019 $7.6k on $360k EQ 832 TU 839 EX 831
March 2021 $33k on $312k EQ 796 TU 798 EX 801
May 2021 Paid all Installments and Mortgages, one new Mortgage EQ 761 TY 774 EX 777
April 2022 EQ=811 TU=807 EX=805 - TU VS 3.0 765
Message 6 of 26
Anonymous
Not applicable

Re: PenFed cracking down on credit card misuse with new T&C

The thing is I called them prior to the first transaction and specifically asked if account funding would be a problem and they said no after checking with a supervisor, when I called in after first 1k was flagged I told them it was for account funding and they approved it immediately, I also told them I have few more coming so don't alarmed and they said they will put a note on the account, the following 4 transactions went through without a hitch. Perhaps they've changed their policy, I will call and check with supervisor if I decide to do another.

 

Edit: I just went back and checked statements, Penfed also accepts CC initial funding, I funded $5 with CC into the shares savings account when I opened Penfed membership.

Message 7 of 26
NRB525
Super Contributor

Re: PenFed cracking down on credit card misuse with new T&C

$5 is one thing, and you used a non-PenFed card.
$5,000 quite another.

I am not an insider at PenFed but this looks like it matches their note above
High Bal Jan 2009 $116k on $146k limits 80% Util.
Oct 2014 $46k on $127k 36% util EQ 722 TU 727 EX 727
April 2018 $18k on $344k 5% util EQ 806 TU 810 EX 812
Jan 2019 $7.6k on $360k EQ 832 TU 839 EX 831
March 2021 $33k on $312k EQ 796 TU 798 EX 801
May 2021 Paid all Installments and Mortgages, one new Mortgage EQ 761 TY 774 EX 777
April 2022 EQ=811 TU=807 EX=805 - TU VS 3.0 765
Message 8 of 26
coldfusion
Community Leader
Mega Contributor

Re: PenFed cracking down on credit card misuse with new T&C


@Anonymous wrote:
I wonder if this will extend to deposit account initial funding. I have done 5 initial fundings since May with my PCR totaling $3,250, the first 1k was flagged but released after verification, nothing after that. I'm about to open another batch of deposit account SUBs, hope they don't crack down on that.

The big concern is that the funding is being used to generate spend in order to meet the requirement for a SUB.  

(3/2024)
FICO 8 (EX) 846 (TU) 850 (EQ) 850
FICO 9 (EX) 850 (TU) 850 (EQ) 850

$1M+ club

Artist formerly known as the_old_curmudgeon who was formerly known as coldfusion
Message 9 of 26
Loquat
Moderator Emeritus

Re: PenFed cracking down on credit card misuse with new T&C

Received this email as well.  Can't remember the last time I swiped my PenFed card (which reminds me that I need to do so).  I only use them now for the ongoing 0% (3% fee) 12 month BT when I need one.  Other than that, their Platinum Rewards card that I have is a bit lacklusted mostly due to their rewards program.  I hate having to redeem for a Visa giftcard via snail mail.  Present the option to collect via direct deposit or statement credit and *maybe* I'd toss the card a glance every now and again. 

Message 10 of 26
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