American Express to pay $230M settlement over claims of deceptive credit card, wire service sales tactics

American Express said on Thursday it will pay about $230 million to settle criminal and civil probes into alleged deceptive practices in selling credit card and wire transfer products to small business customers.The credit card and travel services company agreed to pay $138.4 million, including about $108 million in fines, and enter a non-prosecution agreement to end criminal and civil probes by the US Department of Justice.“Pursuant to the agreements and after crediting, American Express will pay approximately $230 million in total to resolve these matters,” the company said in a statement on Thursday.American Express said it also reached an agreement with its regulators at the Federal Reserve, which it expects will be finalized in the coming weeks.Between 2014 and 2017, some AmEx staffers used aggressive sales tactics to pressure small-business owners into signing up for credit cards, according to a DOJ press release.To secure the sales, employees would misrepresent card rewards and fees and check credit reports without asking, the DOJ said.Sometimes, staffers would issue cards that were not sought out, according to The Wall Street Journal, who reported on the schemes in 2020.

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Salespeople would also allegedly submit false financial information for customers, like “overstating a business’s income,” the Justice Department’s press release said.AmEx also tried to “deceive its federally insured financial institution” to let customers get credit cards without the required employer identification numbers by using “dummy” EINs like “123456788” through 2015 and 2016, the DOJ claimed.Along with the sketchy credit card sales tactics, AmEx workers misleadingly marketed wire products – pitching them as a w...