A nationwide class-action lawsuit has been filed against Aeroplan Inc., Canadian Imperial Bank of Commerce (CIBC), and Toronto-Dominion Bank (TD Bank) in Canada, following allegations that these institutions unfairly rescinded Welcome Bonus Points from thousands of Aeroplan credit card holders.
The lawsuit, initiated by Consumer Law Group (CLG), claims that these banks “clawed back” bonus points from customers who had applied for a second Aeroplan Visa credit card. The legal action highlights that these customers were unaware that they might not be eligible for the bonus points after applying for a second card. The suit is filed on behalf of approximately 17,000 affected individuals who were notified of the rescinded points in October 2024, nearly a year after they had signed up for their second credit card. The clawing back of these points is claimed to be an unfair practice.
Overview of the Class Action Lawsuit
The lawsuit targets three main companies: Aeroplan Inc., TD Bank, and CIBC. It alleges that approximately 17,000 Aeroplan members were affected when their Welcome Bonus Points were unexpectedly rescinded after they applied for a second Aeroplan Visa credit card. Notifications about the clawed-back points were sent in October 2024, well after the points were initially granted.
The lawsuit demands compensatory and punitive damages for the impacted consumers, as well as the restoration of the points that were taken back.
Allegations Behind the “Clawback” of Points
When customers sign up for an Aeroplan Visa credit card from either CIBC or TD, they often receive Welcome Bonus Points as an incentive. However, the lawsuit claims that many customers who already had an Aeroplan credit card and applied for a second one were unaware that they might not qualify for the bonus points a second time. According to the lawsuit, neither TD Bank nor CIBC verified whether applicants were existing Aeroplan cardholders, which was a key eligibility condition for receiving these points. As a result, thousands of customers had their points taken back without prior notice, leading to significant confusion and frustration.
Key Details of the Lawsuit
The lawsuit accuses Aeroplan, CIBC, and TD of failing to adequately communicate with customers. Even though the institutions collected Aeroplan account numbers during the credit card application process, they allegedly did not inform customers that they were not eligible for the Welcome Bonus Points if they were applying for a second card. This lack of transparency is a central issue in the case.
Impact on Consumers
Customers affected by the clawback of points experienced financial losses. On average, account holders lost at least 10,000 Aeroplan points, which could be worth anywhere from CAD $100 to $150. Additionally, many customers had to pay annual fees and other expenses for their second Aeroplan card, under the assumption that they would receive the bonus points.
Allegations of Unfair Practices
CLG has outlined several key allegations in the lawsuit:
- Violation of Consumer Protection Laws: The rescinding of points without prior notice is said to violate consumer protection laws in various provinces.
- Unfair Practices: The lawsuit argues that the clawback of points constitutes an unfair business practice, as customers were misled into believing they would receive the bonus points.
- Negligence in Verification: Neither CIBC nor TD Bank reportedly took steps to verify whether applicants were eligible for the bonus points, resulting in confusion and the unexpected removal of points.
What the Lawsuit Seeks
The lawsuit aims to achieve several key outcomes:
- Restoration of Points: It seeks the return of the Welcome Bonus Points that were unfairly taken away from affected individuals.
- Compensation for Losses: The lawsuit demands compensation for financial losses incurred by consumers, such as annual fees and other related expenses.
- Punitive Damages: The lawsuit also calls for punitive damages due to the alleged unfair practices of the banks and Aeroplan.
How to Participate in the Class Action
If you are affected by this issue and believe you qualify for the class action, here are the steps you can take:
- Check Eligibility: You must have applied for a second Aeroplan Visa credit card from either TD or CIBC and had your Welcome Bonus Points rescinded.
- Join the Class Action: To express your interest in joining the lawsuit, provide your contact information to the Consumer Law Group.
Representatives from Aeroplan, CIBC, and TD Bank have responded to the lawsuit by stating that, as the case is currently before the courts, they cannot comment on the allegations. A spokesperson from Aeroplan, however, stated that the company intends to “vigorously defend” itself in the legal proceedings.
For affected Aeroplan members, this class action lawsuit provides an opportunity to potentially recover lost points and receive compensation for the financial impact caused by the clawback. If successful, it could lead to increased transparency and better consumer protection in the future when it comes to promotional offers from major financial institutions.
