Weekend Reading: Air Miles Class Action Edition

It was only a matter of time. Air Miles has faced plenty of criticism in recent months, not just for instituting an expiry policy, but mishandling communication to its collectors about the new policy, automatically defaulting existing reward miles into their ‘Dream Miles’ category, not allowing members to transfer miles between their Dream and Cash Miles accounts, hiding high-value or popular reward items from collectors under the guise of ‘personalizing’ their online experience, and having longer than acceptable wait times at their call centre. The list goes on.

Many readers have called for a class action lawsuit against Air Miles and its parent company, LoyaltyOne. That’s exactly what’s about to happen, as Calgary law firm JSS Barristers filed a statement of claim against LoyaltyOne, stating that the expiry policy instituted by the Air Miles loyalty rewards program was an unfair and unilateral change.

Air Miles Class Action

The statement claims that Air Miles has engaged in unfair practices, including:

a) implementing an expiry policy, when no expiry policy of the Miles had previously existed, without adequate notification to the Class Members and contrary to their reasonable expectations;

b) date-stamping Miles, when no date-stamping of Miles had previously existed, resulting in an expiry of Miles, without adequate notification to the Class Members and contrary to their reasonable expectations;

c) causing unreasonable and unacceptable difficulty for Class Members to redeem their Miles through Air Miles’ telephone system due to inadequate or improper management of the telephone system, resulting in unduly long wait times;

d) failing to make all high value Rewards available to members with high Miles balances when they attempted to redeem their Miles;

e) improperly reducing the types of Rewards available to members and improperly eliminating certain categories of Rewards altogether; and

f) introducing a new Cash Rewards program, and removing Rewards from the historic Dream Rewards program and placing them into the Cash Rewards program, without adequate notification to the Class Members, and without enabling Class Members to change their earned Dream Reward Miles to Cash Reward Miles, thereby stripping the Dream Rewards program of significant value.

It’s worth noting that Aeroplan cancelled its seven-year mileage expiry policy in 2013 after the company faced a potential class action lawsuit and similar consumer outrage over changes to its program.

Will Air Miles and its sponsors continue their silence, hoping this dust-storm blows over (it won’t)? This story isn’t going away anytime soon.

This Week’s Recap:

Speaking of Air Miles, my open letter hit the news again as The Globe and Mail’s Rob Carrick linked to it in his weekly newsletter (thanks Rob!).

Michael James on Money also gave a nod to my open letter in his thousand-foot-view of Air Miles (thanks Michael!).

On Monday I dug into my pension plan to discover how much it would pay me in retirement.

On Wednesday Marie suggested we revisit the tax free savings account and make plans for investing the funds.

And on Friday Marie shared five ways to stretch your retirement dollars.

Weekend Reading:

The Globe and Mail continues its excellent investigation into some shady practices going on in the Vancouver housing market. The first article looks at how nine students with no apparent source of income bought $57-million worth of single-family homes over the past two years.

Further investigation shines a light on Canadian banks allowing foreign clients with no credit history to qualify for uninsured mortgages without proving the sources of their income.

As expected, the CRA is launching a review of these B.C. real estate speculators.

York University professor Lisa Phillips suggests a look at the principal-residence exemption as a fixable piece of the housing puzzle.

This Financial Post article argues that if your retirement security is built on your home, now might be the time to sell.

Another take on investing vs. paying off the mortgage faster. This time it’s Jordann Brown, who’s opting for more of a balanced approach.

80% of Canadians have seen a jump in their credit scores. Why? Because Equifax implemented a change to its scoring system, which for the first time will see mortgage payments and cell phone payments affect your score.

On the same topic, Borrowell put together the ultimate guide to Canadian credit scores.

This Wall Street Journal column suggests that happiness may not be about how much overall wealth you have, but how much cash you have on hand.

Dan Hallett helps investors make sense of their new CRM2 performance report.

The always thoughtful Ben Carlson offers some reflections on his first year as a registered independent advisor with Ritholtz Wealth Management. Some food for thought:

“We have plenty of clients that come to us because they assume they need help with portfolio management. And while that is a huge part of the process, what most people quickly realize is that they really need help with financial planning and how their finances fit into their goals and desires. The best asset management on the planet won’t matter much if the client doesn’t understand how it ties into their own personal situation.”

Also read: 10 money revelations in my 30s

Carl Richards spilled the beans and revealed the secret society of real financial planners.

Jonathan Chevreau wrote about optimizing CPP and found that the later you take it, the better.

Finally, Squawkfox Kerry Taylor dishes the dirty details on cloth diapers – will they save you money and are they worth it?

Have a great weekend, everyone!