OK, so I have no working knowledge of US laws or how Citi handles these issues. However I would expectthat while the points are under Citi's control they are likely to take them.

Are they airline miles or Citi miles that can be transfered to airline miles? Let me talk about Diners because it's one I know, and it's also run by Citibank... so there might be some similarities here...

I can transfer my Diners points to most airlines or hotel programs. While they are Diners points they are at Diner's control... if I was in this situation I'd be moving the points to an Airline or Hotel prgoram where it is harder (but not impossible) for Diners to get them back.

So that's my 2 cents, bearing in mind once again I know not of what I speak.