[2019.1 Update] During the period when Chase had previously shut down my accounts, it just so happened that Chase Hyatt was issuing the annual Free Night. Interestingly, the annual fee posted as normal, but the Free Night was never added to the account. So keep an eye on this: if your account is temporarily closed, the Free Night will not be credited to your Hyatt account normally. Be sure to ask for it back. Customer service gave me 15,000 points as compensation, which was actually pretty good—better than an FN that would expire. Of course, I also hope Chase doesn’t target any of you. FR is still a huge hassle.

Background

Although I’ve become pretty skilled at various MS techniques and other points-earning methods, after 4-5 years of playing the credit card game, I had already started to lose that original excitement. You could say I went from being aggressive to taking a much more laid-back approach. I barely put any spend on my Chase cards anymore. I kept a few hotel drawer cards just to collect the annual Free Night, occasionally used Freedom for 5x, and played around with the 3x on WeChat Pay with Sapphire Reserve. That was about it.

Even though I had 7 Chase cards, I had lowered the credit limits on basically all of my drawer cards to $1,000-$2,000 to reduce risk, and I kept the other cards at their minimum limits as well. So my total credit line was still below the usual risk threshold. It had been almost 4 years since my first Freedom card, and I had also maintained a good balance in my checking account the whole time. Outside of Chase cards, I had around a dozen cards from other banks in total, and I hadn’t applied for any new credit cards for nearly a year. As for my credit score, I hadn’t applied for many cards recently and didn’t carry much balance, so my scores at all three bureaus were around 800.

Noticing the Shutdown

In Q1 2018, Freedom’s 5x categories included Mobile Payment, so to maximize 5x, I added my Freedom card to Samsung Pay. Every now and then I would look for gift card deals in Samsung Pay and resell some, trying to max out the quarter’s bonus. But one day when I wanted to use it again, I noticed that my Freedom card had disappeared from Samsung Pay. My heart immediately sank. My gut told me that if it disappeared for no reason, there was a good chance the card had been shut down. So I quickly logged into my Chase online account and saw that the card looked fine—it didn’t show as Closed, and there didn’t seem to be any problem with my other Chase cards either. So I didn’t look too closely.

A few days later, I got an alert from CreditSeame (a website that lets you access and monitor part of your credit report for free), saying that one of my accounts had been closed. I checked and saw that one Chase card was showing as closed. I immediately logged into my Chase online account again, and that’s when I discovered that 6 out of my 7 cards all showed Available Credit as 0, even though I actually had no balance on any of those cards, while the total credit line still displayed normally. I optimistically guessed that the accounts were probably under review, and that if I passed the Chase review, everything would return to normal.

A few days later, CreditSeame kept alerting me that more Chase cards had been closed. When I checked, my Chase account still didn’t show them as closed, but the Available Credit on those cards remained at 0. Ironically, one of my cards had just posted a $95 annual fee, which I had not yet paid off, and that card’s Available Credit was still normal. I have no idea what Chase was thinking. Eventually, I logged into my Chase account and saw that all 6 cards were now uniformly marked Closed. That’s when I realized this was serious.

After seeing this, I immediately pulled my full Experian credit report and found that Chase had soft pulled my credit report the day before my first card was removed from Samsung Pay. Then all six of those cards showed as closed by bank, with slightly different closure dates. At that point, it was basically certain that Chase had “killed the whole family,” meaning they had shut down my entire Chase relationship.

My Analysis

Since I had recently read quite a few cases of Chase shutdowns, and there were also bloggers who had just gone through shutdowns and later been reinstated, I tried to analyze the possible reasons for my shutdown:

  • I used Samsung Pay + Freedom for 10 straight days, with each transaction for $21.5, two transactions per day. All of them qualified for Freedom’s 5x category.
  • I had recently used WeChat Pay + Chase Sapphire Reserve for purchases in China, with transaction amounts ranging from $1-$30. All of them qualified for Sapphire Reserve’s bonus categories.
  • In November-December 2017, my spending was a little higher than before, most of it on AMEX cards (AMEX Offer), and I did not keep my balances down before the statements closed. Each card’s balance was around 7% of that individual card’s limit, and about 3% of my total available credit.
  • I earned quite a lot of points through Refer a Friend.
  • There were several PayPal withdrawals in my Checking Account.

I ranked the above reasons by likelihood. Since my checking account was still perfectly fine, I could basically rule out the last one. Refer a Friend also seemed unlikely, since there is a built-in cap anyway. As for spending amounts and balances, that’s harder to say—those factors do seem to be related to many Chase shutdowns. As for putting spend only on bonus categories like 5x or 3x, that usually carries more risk on Ink business cards. And in my case, I had only put about $600 on 5x spend and less than $300 on 3x spend. Thinking it through, I really didn’t seem like the kind of customer who posed risk to the bank. At most, I was just the kind of customer Chase couldn’t make much money from. So I decided to try communicating with Chase.

What I Did

First, I called the number on the back of my Chase Sapphire Reserve card, because that line usually gets you to a live representative directly, which makes communication quicker. After some small talk and identity verification with the agent, we finally got to the point:

  • Me: It looks like this card was closed. Can you help me see what happened?
  • Rep: It was indeed closed by bank. Did you receive a letter about the closure?
  • Me: No, I didn’t receive anything at all.
  • Rep: I checked, and it looks like it was closed around February 26. The letter was mailed out at the same time.
  • Me: I never got it. Can you help me check the reason?
  • Rep: I can’t see it on my end, but I can transfer you to another department to take a look.

The call got disconnected during the transfer, but based on my experience, it was probably being transferred to Chase’s well-known Fraud department. So based on information from previous articles, I called 1-800-290-1316. This representative was very experienced. After verifying my identity, they immediately started checking the information for me.

  • Rep: These cards were indeed closed. You will receive a paper letter explaining the reason for the shutdown.
  • Me: I haven’t received a single letter.
  • Rep: Let me check and see whether I can view the reason. It will take about 2 minutes.
  • Me: Okay.
  • ...fifteen minutes later...
  • Rep: I checked, and the trigger for the shutdown was one of your credit cards ending in XXXX (my Freedom). The specific reason was that you charged the same amount repeatedly over multiple consecutive days. Can you explain those charges?
  • Me: I was buying gift cards through Samsung Pay at a discount, and you could only buy two per day, so I bought them over several consecutive days. I wanted to combine them for a larger purchase.
  • Rep: Oh, I understand. So you were buying gift cards for many days in a row, right?
  • Me: Yes. What’s the big deal? It was only $42 per day, about six hundred total. I’ve had this Chase card for almost five years, and I also have checking with you, with plenty of deposits in it. What was Chase thinking in shutting my cards down? This is absurd.
  • Rep: Uh. I’ll submit your explanation and then help you file a request to reopen the accounts. It will take 10 business days.
  • Me: Could you give me a way to contact your department?
  • Rep: 1-800-290-1316 (which is really just their department’s phone number)

The Fraud department rep confirmed what I had suspected: the Review was triggered by multiple Samsung Pay charges for the same amount, which then spilled over to my other Chase cards and resulted in all of my cards being shut down.

After submitting the case, I obviously wasn’t going to just sit around and do nothing, so I immediately transferred all of my Ultimate Rewards points to LD’s account. During the process, I found that even if the Sapphire Reserve had been closed, I could still transfer points to airline miles or hotel points, and I could still redeem UR at 1.5x. My guess is that after shutting down accounts, Chase gives everyone a full 30 days to take care of the aftermath. If you’re not confident you’ll get the accounts reinstated, I’d suggest moving all your assets out in advance.

Result

About 3 business days later, I logged back into my Chase account and found that the available credit on all my cards had been restored to each card’s original credit limit, and the “Closed” label was gone as well. On the surface, it looked like all of my cards had been reopened. To confirm, I called the Fraud department again.

  • Me: What happened with the case about all my Chase cards being closed last time?
  • Rep: I checked, and they’ve all been reopened for you.
  • Me: Can you explain the reason?
  • Rep: Rapid increase in revolving balance (in other words, your statement balance suddenly increased)
  • Me: But I really didn’t have much balance at all.
  • Rep: xxxxx, maybe it was triggered by Samsung Pay, xxxx a bunch of nonsense
  • Me: Alright, thanks.

A lot of people who get shut down are given this same reason: Rapid increase in revolving balance. It basically means your balance suddenly increased. From the bank’s perspective, suddenly owing a lot more money is obviously a higher risk. But in my case, my balance was actually very small relative to my total credit limits, around 1%-3%, so I really have no idea how Chase came up with that conclusion.

Summary

Overall, my shutdown experience was pretty bizarre. It felt more like Chase’s systems were overly sensitive, which triggered a Review, and then somehow they decided my balance was too high and shut down my cards. To avoid something like this, here are a few things I think are worth paying attention to:

  • If you had relatively high balances over the past few months, I’d recommend not applying for a new Chase card for the next few months, and also avoiding behavior that could look like Fraud. For example, buying a large number of gift cards or making charges for the exact same amount several days in a row. Try not to give Chase any reason to Review your account.
  • If your cards get shut down, be sure to call the Fraud department at 1-800-290-1316 to find out why. Then explain the situation to the rep and submit a case. If that doesn’t work, you can also plead your case through Secure Message. In short, make your explanation as reasonable as possible so the bank lowers its risk assessment of you.
  • If you’re not confident, you can first transfer your UR points to LD’s account, or directly convert them into airline miles or hotel points you can actually use. Don’t let Chase get them for nothing.
  • I also recommend checking your credit report regularly. If something like a shutdown happens, you may find out earlier and deal with it sooner. Free services like Credit Sesame, especially ones that also send email alerts, are ideal.

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