Feds probing American Specific’ enterprise, consumer card sales practices
American Express announced on Friday that several federal agencies are reviewing their credit card and consumer card sales practices for small businesses.
The Company said in a regulatory filing that it received a grand jury subpoena in January from the US Attorney’s Office for the Eastern District of New York for its sales practices for its small business credit cards.
It also received a civil investigation request from the Consumer Financial Protection Bureau (CFPB) seeking information on sales practices related to consumers.
The company also announced that it responded in May to a governmental review of “historical sales practices associated with certain small business card sales” led by the Office of Currency Auditors (OCC) and the Department of Justice (DOJ).
The company said it is cooperating with all of these inquiries and has continued to improve our controls over our sales practices.
“We do not believe this matter will have a material adverse effect on our business or results of operations,” he added.
The DOJ had no comment, and the CFPB said it did not comment on any pending enforcement work, including confirming or denying pending matters.
The OCC did not immediately return a request for comment from The Hill.
The Wall Street Journal reported last month that several U.S. financial agencies were investigating the company’s ticketing practices, citing people familiar with the matter. These agencies were the OCC, as well as inspectors-general of the Treasury Department, the Federal Deposit Insurance Corporation, and the Federal Reserve.
Several current and former employees previously told the newspaper that some salespeople misled or heavily armed small businesses into signing up for cards in order to increase sales.
Updated: 9:30 p.m.