I got a more sympathetic but clueless agent. When I called she had no idea what I was concerned about and said the conversion rate has always been that way. She said she was unaware of any changes in their award program but she checked for me.
After about 5 min she confirmed there was change and was equally as surprised that I didn't receive any notification. She agrees it's a bad practice not letting us know in advance and agrees the T&C require written notification for at least 90 days.
I stressed the fact that Citi advertised on their website that one of the feature of Citireward points is that it never expires and no cap to it. That's the reason I banked all my points as citireward rather than transferred earlier. What's the benefit of no cap and no expiry if the points will ultimately devalue without warning.
She offered 10,000 points as a compensation in her power, but I told her my loss was greater than that and $700 annual fee is not a small fee. I requested a reduced annual fee then she say either I can take 10,000 points or get refund of the $700 annual fee. Well, I think $700 probably worth more than 10,000 points so I took the offer. I tried to push for reduced annual fee for life but no luck. Well, at least I got this card for free this year and when annual fee time comes I can threaten to cancel the card.
Anyway, you guys probably guessed it, I'm with Citiprestige so maybe that's why I had a better agent. I guess if you have a fee free for life signature card, you really can't argue much.