{"id":587,"date":"2025-01-18T22:40:51","date_gmt":"2025-01-18T22:40:51","guid":{"rendered":"https:\/\/finzexpert.com\/blog\/american-express-to-pay-230-million-to-settle-deceptive-marketing-claims\/"},"modified":"2025-01-18T22:40:51","modified_gmt":"2025-01-18T22:40:51","slug":"american-express-to-pay-230-million-to-settle-deceptive-marketing-claims","status":"publish","type":"post","link":"https:\/\/finzexpert.com\/blog\/american-express-to-pay-230-million-to-settle-deceptive-marketing-claims\/","title":{"rendered":"American Express to Pay $230 Million to Settle Deceptive Marketing Claims"},"content":{"rendered":"\n<div data-testid=\"companionColumn-0\">\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">American Express said on Thursday that it would pay $230 million to settle civil and criminal allegations that the company used deceptive sales tactics related to credit card and wire transfer products sold to small business customers.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">The Justice Department\u2019s civil division claimed that, from 2014 through 2017, the credit card and travel services giant misrepresented its card rewards and fees, and whether credit checks would be done without a customer\u2019s consent. The Justice Department also said the company had submitted falsified financial information for prospective customers, such as overstating a business\u2019s income.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">American Express was also accused of tricking its bank into issuing credit cards to small business customers without employer identification numbers, or E.I.N.s, which are required for certain businesses, the department said.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Then, from 2018 to 2021, the department claimed, American Express deceptively sold wire transfer products known as Payroll Rewards and Premium Wire, making false claims about the products\u2019 tax benefits.<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<div data-testid=\"companionColumn-1\">\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">The Justice Department settlement includes a $108.7 million civil payment related to those allegations.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">American Express also entered a separate nonprosecution agreement with the U.S. attorney\u2019s office for the Eastern District of New York to resolve a criminal investigation related to the Payroll Rewards and Premium Wire products. The company will pay about $138 million to resolve that matter.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Amex also said on Thursday that it had reached an agreement in principle with the Federal Reserve System to resolve investigations into the same practices. The settlements include a potential credit the company is expected to receive, bringing the overall total penalty to $230 million, American Express said. <\/p>\n<p class=\"css-at9mc1 evys1bk0\">The credit card giant said it \u201ccooperated extensively\u201d with the agencies and its regulators, and took \u201cvoluntary action\u201d to address the issue. That included discontinuing certain products, conducting a comprehensive internal review and taking disciplinary measures, making organizational changes and enhancing its internal controls.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">American Express said the settlement costs were already set aside and disclosed in prior periods and will not affect its 2024 earnings guidance.<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n","protected":false},"excerpt":{"rendered":"<p>American Express said on Thursday that it would pay $230 million to settle civil and criminal allegations that the company used deceptive sales tactics related to credit card and wire transfer products sold to small business customers. The Justice Department\u2019s civil division claimed that, from 2014 through 2017, the credit card and travel services giant [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":588,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[184,190,188,185,189,164,186,187],"class_list":["post-587","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-loan","tag-american","tag-claims","tag-deceptive","tag-express","tag-marketing","tag-million","tag-pay","tag-settle"],"_links":{"self":[{"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/posts\/587","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/comments?post=587"}],"version-history":[{"count":0,"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/posts\/587\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/media\/588"}],"wp:attachment":[{"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/media?parent=587"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/categories?post=587"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/tags?post=587"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}