NEW YORK – American Express (AmEx) has disclosed a pair of federal probes into its sales practices, according to a securities filing yesterday.
AmEx said it is cooperating with a January grand jury subpoena from the United States Attorney’s Office in the Eastern District of New York over its sales practices for small business cards.
The disclosure follows reports that the company used questionable tactics to sign up small businesses.
The credit card firm has also received a civil investigative demand from the US Consumer Financial Protection Bureau over its sales practices to consumers, it said in a filing in with the Securities and Exchange Commission.
“We are cooperating with all of these inquiries, and have continued to enhance our controls related to our sales practices.
“We do not believe this matter will have a material adverse impact on our business or results of operations.”
The Wall Street Journal last month reported that AmEx faces scrutiny from a number of federal agencies over whether it uses strong-arm and misleading tactics to sign up small businesses.
An earlier report in WSJ recounted instances where AmEx sales reps misrepresented card rewards or issued unrequested cards to boost sales figures. – AFP, February 13, 2021
