AmEx will pay at least $75.7M in settlement

NEW YORK (AP) - American Express has agreed to pay at least $75.7 million to end an investigation into what regulators said was misleading marketing of some discontinued card products.

The Federal Deposit Insurance Corp. said Tuesday that American Express led consumers to believe that an account protection product would work for up to two years when the benefits usually lasted no more than three months, and it didn't properly explain the enrollment process for a product intended to protect against identity theft. It said 85 percent of consumers who signed up didn't complete the enrollment process, but they were billed anyway.

The agency also said that the company misrepresented the terms of a "lost wallet" product that was offered to Spanish-speaking customers in Puerto Rico, and it did not provide written materials in Spanish.

The FDIC says the programs were marketed to customers between 2004 and 2012. It said American Express will pay restitution to 335,000 customers.

The New York-based company said it agreed to pay $16.2 million in fines and repay at least $59.5 million to customers.

American Express Co. said it has set aside enough to cover most of the costs of the settlement with the FDIC, the Consumer Financial Protection Bureau, and the Office of Comptroller of the Currency. It has already made most of the payments to customers.


(Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

Top Stories

  • Fact Check
    Jason Rantz says actually, there are laws to address negligent gun owners

  • Best in the House
    With Seahawks home games 'sold out' the ticket price of this seat doesn't seem so bad

  • Microsoft's Latest
    Microsoft releases a band that monitors more than just your fitness
ATTENTION COMMENTERS: We've changed our comments, but want to keep you in the conversation.
Please login below with your Facebook, Twitter, Google+ or Disqus account. Existing MyNorthwest account holders will need to create a new Disqus account or use one of the social logins provided below. Thank you.
comments powered by Disqus
Sign up for breaking news e-mail alerts from MyNorthwest.com
In the community
Do you know an exceptional citizen who has impacted and inspired others?
KIRO Radio and WSECU would like to recognize six oustanding citizens this year. Nominate them to be recognized and to receive a $2,000 charitable grant.