American Express Announces Settlements with Bank Regulators Related to U.S.
NEW YORK -- October 01, 2012
American Express Company today announced that it has reached settlements with
several regulatory agencies to resolve previously disclosed reviews of certain
aspects of the company’s U.S. consumer card practices.
Similar settlements were reached with several of the company’s subsidiaries,
including American Express Centurion Bank; American Express Bank, FSB; and
American Express Travel Related Services Company, Inc. The settlements were
signed with the Federal Deposit Insurance Corporation (FDIC), Consumer
Financial Protection Bureau (CFPB), Board of Governors of the Federal Reserve
System (FRB), Office of Comptroller of the Currency (OCC), and Utah Department
of Financial Institutions (UDFI).
As described in their consent orders, the regulators cited violations
including those relating to certain aspects of debt collection practices,
credit card solicitations, late fee charges, the reporting of disputes to
credit bureaus and new account approval processes.
American Express has developed remediation plans for each of the cited
violations and agreed to pay fines totaling $27.5 million. In accordance with
the consent orders, the company, through its subsidiaries, will establish
funds totaling $85 million for customer refunds. The majority of those refunds
are related to debt collection practices and late fee charges. Impacted
customers will be notified as soon as possible.
American Express has cooperated fully with the FDIC, CFPB, FRB, OCC, and UDFI.
The company is strengthening its internal compliance processes and will
continue to work closely with its regulators.
Reserves were established in previous quarters for a substantial portion of
these fines and the estimated cardmember refunds. Separately, the company is
continuing its own internal reviews and is also cooperating with regulators in
their ongoing regulatory examination of add-on products in accordance with an
About American Express
American Express (NYSE:AXP) is a global services company, providing customers
with access to products, insights and experiences that enrich lives and build
business success. Learn more at americanexpress.com and connect with us on
linkedin.com/companies/american-express, twitter.com/americanexpress, and
Key links to products and services: charge and credit cards, business credit
cards, travel services, gift cards, prepaid cards, merchant services, business
travel, and corporate card
Marina Norville, +1 212-640-2832
Mike O’Neill, +1 212-640-5951
Press spacebar to pause and continue. Press esc to stop.