Wow -- I did not even know that was part of the T&C. I thought it was totally permitted. Seems to me that this thread is an important one, since I presume I'm not the only one who didn't understand this. Admittedly, it's everyone's responsibility to know the terms, but when you go to transfer points, it certainly doesn't mention any restriction. Sure enough, though, the T&C do indeed seem to suggest it's not permitted:

• You may transfer Ultimate Rewards points to any other eligible credit card or debit card with Ultimate Rewards earning points, and rebates earned to a credit card earning in rebates. “Rewards” in this section means points or rebates, as applicable.
• To determine if you are earning in points or rebates, see the “Ultimate Rewards” section of your credit card statement.
• Transfers may only be used to combine rewards belonging to the same individual or business in the Program; or for the purpose of enabling spouses or domestic partners to combine rewards earned in their respective names.
• If either the transferee’s or your credit card account(s) or checking account(s), as applicable, are in default at the time of the transfer, Chase will not make the transfer.
• Once rewards are transferred, they cannot be credited back.