"Merit points can't be stolen but the things you redeem them for can. The outer sect disciples who choose to become the lackeys of the inner sect disciples use their status no matter how lowly to mistreat their fellow outer sect disciples.
A slave of a king is higher in station than the chief guard of a commoner no matter how rich the commoner.
The same logic applied to them. Even though they were still outer sect disciples, their association with a particular inner sect disciple gave them an edge over the rest which they used as an outlet to vent their frustrations.
In some regard, they were even more cruel than the inner sect disciples themselves. Humiliating us wasn't enough they had to pit us against each other.