AmEx raised currency rates for SMEs without warning

Wednesday 1 August 2018 10:28 CET | News

American Express has raised currency conversion rates for business clients without notifying customers, Reuters cited Wall Street Journal.

The practice, mainly within the forex department, could be an attempt to boost revenue and employee commission and was occurring until early 2018 and dates back to at least 2004, the Journal reported. To spot the change, customers generally would have to log in to their accounts and compare the rate AmEx was offering to the market exchange rate at the time of the transaction.

The practice mostly targeted small and midsize businesses, where a salesperson would 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 Journal reported.

However, the salespeople did not inform customers that the margin, a markup that AmEx tacks on to the base currency exchange rate, was subject to increase without notice, the WSJ reported.

AmEx’s forex unit accounts for less than half of a percentage point of its total revenue and has a training, control and compliance oversight, the company said for Reuters.

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Keywords: American Express, currency, SME, FX , conversion rates, US
Countries: World