Wednesday, September 12, 2018
Andriotis suggested the practice may have been going on since 2004, presumably as a ploy to boost revenue and employee commissions. Her sources include current and former AmEx employees, who attribute the practice to the company's "commissions-driven culture." In one example, Andriotis reported a former AmEx employee said he was told during forex training to "sign up as many accounts as he could in his early days and to go back later and adjust the rates upward to hit revenue targets."
Androitis went on to state that salespeople "would often tell potential clients that AmEx would beat the price they were paying banks or other financial institutions to convert currency and send money abroad. The salespeople didn't inform customers that the margin, a markup that AmEx tacks on to the base currency exchange rate, was subject to increase without notice, they said."
Payments analysts noted that AmEx has championed small business causes, both as a payment card issuer and as founder of the Shop Small Movement, a nationwide initiative designed to encourage consumers to support local businesses. They find it odd that a company that has dedicated resources and revenue to small business owners would reward salespeople for unfairly targeting the same demographic.
"It must be the same training school that Wells Fargo used for its salespeople," said George Sarantopoulos, CEO and founder of Access One Solutions. "This corporate doublespeak is fairly typical in this day and age; a big company says one thing and acts completely different."
From a revenue standpoint, the forex unit represents "less than half of a percentage point of AmEx's total revenue," but is integral to the company's suite of services for small and midsize business owners, according to Andriotis.
AmEx spokeswoman Marina Norville said the company takes the allegations seriously and will investigate further to determine if sales practices are consistent with the company's training, control and compliance standards. "If we find that we fell short of the mark, we will fix the problems and take appropriate actions to make sure it doesn't recur," she stated.
Adam Webb is partner with Atlanta-based Webb, Klase & Lemond LLC, the law firm currently representing plaintiffs in a class action against Wells Fargo Merchant Services LLC for alleged unauthorized, excessive payment card processing fees. Webb said the allegations against AmEx are much like practices that are widespread in the payment processing realm. Such increases to rates and fees very likely represent breaches of contract and breaches of the implied covenant of good faith and fair dealing, he stated.
"At least when companies send advance notice they can argue that customers chose to accept the higher fees rather than terminating their account," Webb said. "But when there's no notice, the original terms govern, especially where there is no outside basis for the increase, just padding profits. This smacks of bad faith."
Attorneys at Bragar Eagel & Squire P.C. are directing AmEx shareholders and potentially affected individuals to an online submission form to contact attorneys directly and apply for additional information concerning the ongoing investigation. Applicants who acquired AmEx stock and suffered a loss, or anyone who may have questions, concerns or has information related to the investigation is encouraged to apply at no cost or obligation, the attorneys stated. Additional information can be found at bespc.com/americanexpress/ .
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