In message , at 01:16:17 on
Wed, 4 Jan 2006, asdf remarked:
"If we believe that you have used or tried to use any ticket or Oyster
card to defraud us we may cancel and not re-issue it. If this happens,
we will not give you a refund of the remaining value of the ticket or
Pre Pay, or refund any deposit paid for the Oyster card."

...which appears (again, IANAL) to give them free rein to withdraw
your Oyster complete with all stored value, if they happen not to like
what you're doing with it.

Not quite. They would still have to prove intent to defraud. And that
requires a published definition of fraudulent use (at the very least by
comparing with a leaflet that describes non-fraudulent use), which seems
to be absent.
--
Roland Perry