Skip to comments.Don't Leave Home; Your Credit Card is on Hold
Posted on 03/09/2009 4:50:01 AM PDT by christx30
If you have an American Express card, beware: your card could be put on hold at any moment, even if you think you've made all your payments on time. That means, you won't be able to charge anything on your Amex card.
That's exactly what happened to Cathy Jones, a businesswoman with three Amex charge cards. She got a call from Amex last week saying her cards were now on hold, while the company did a financial investigation to make sure she could pay her bills.
Jones was baffled. She's been an Amex cardholder since 1989 and can't remember being late on a payment. So, to get some answers, Jones and I got on the phone, and called the customer service number on the back of her card.
An Amex representative in New Delhi, India, said because of the bad economic times, American Express is now doing financial investigations of thousands of cardholders. The rep said Amex is insisting these customers fill out an IRS form 4506-T, authorizing the company to get their tax returns for the last three years. The rep told us if Jones didn't fill out the IRS form, they'd cancel her charge cards for good, within five days. And here's the part that concerned Cathy Jones: The rep said these "investigations" were being done, not in the US, but in India.
(Excerpt) Read more at msnbc.msn.com ...
Say no more.
It would certainly help to would bring back all of positions sent ‘over there’ during the now-departed times of ‘full employment’.
Looks like AmEx is going the way of the other decrepit credit card companies.
That’s it. I am done with American Express.
Except perhaps to short their stock.
My husband has NO choice. The corporation he works for has all their employee expense cards through American Express.
I guess American Express should consider a new name.
Same here. We haven't received notice of this though. Have you?
Typical drive-by posters...don’t know a damned thing.
It it were your own money you were lending, wouldn’t you want to find out ways to ‘stop the bleeding’...stop losing money to all the small businesses going bankrupt?
I know several people that had high credit ratings and in six months they were filing bankruptcy.
Bad stuff happens.....and sometimes it happens quickly.
It’s smart business sense to reevaluate the risks.
Then how are tax returns from 3 years ago going to help?
How does looking at a 3 year old tax return help?
Ok, I least I didn’t post 3 years after you did!
RE “Wow... why would anyone use AmEx now that they are doing this stuff?”
I love my Chase card dont have AmEx but she may have other credit problems not mentioned like cable bill .
It’s called unsecured debt.
Because it provides a good composite of how much of the person/company's gross income...which is always used in applications...is being written down on the Schedule C.
Send copies of tax returns to New Delhi... yeah, okeydokey.
Amex can certainly tighten up their credit review if they wish. If asked for my tax returns, I think I will instead send back my Amex blue card. I’ll send it to New Dehli wrapped in presents from New York courtesy of my cat’s litterbox.
The AmEx card I have is also a corporate card and we’re forced to use it by the company in order to be reimbursed.
I’ve not received notice of any of this, but I sent the link to my upper management to see what they have to say about it. The company employs just shy of 50,000 people so hopefully if this is being done they can stomp on it for us.
If it were me:
“I have no intention of sending MY tax information to India.
This sound more like an attempt to extort identity theft.
If AmEx believes this is a good business practice, then it’s important for me to tell them otherwise.
The only prudent action is for me to cancel all 3 account immediately!
He should contact Corporate HQ and let them know there may be an attempt to extort ID theft and the company needs to change contracts!
Didn't you get them memo? They're now a bank so that they can get their fair share at the TARP trough/window. They then lend that cheap money out to chumps who pay them for the privledge and then gouge merchants who accept their plastic. Folks have been paying attention and paying them down.....they're stuck with lots of dead wood now
Watch for them to take another dip this week.
That’s exactly what happened to Cathy Jones, a businesswoman with “”three Amex charge cards””. She got a call from Amex last week saying her cards were now on hold, while the company did a financial investigation to make sure she could pay her bills.
Simple “red flag” 3 AMEX cards...no reason for that. If I was AMEX I would want to talk to her also. I would bet that they have been sending her information that she has not responded to.
100 to 1 there is more to this than has been reported
I’ve heard of a couple of people with excellent driving records losing their auto insurance as well. Companies are actively shedding risk.
Corporate HQ needs to tell AmEx that the corporation stands behind the accounts and if that’s not good enough the corporation will change accounts!
He still has a choice, it just may not be a very likable one, or one you would ever want to have to consider.
For myself, personally, I would never be the one to take the risk of having to pay the business expenses of the company I work for. Since I would never have an AmEx card in my name (especially not for a company I didn't own) I would be left with the choice of looking for different work.
Well Mr. “no reason for that”, try this one percent possibility:
Husband has a Corporate AmEx Card,
Wife has Corporate AmEx Card,
Couple has private AmEx account.
I’ll bet $10 this woman has high balances and is making minimum monthly payments to get this kind of attention from AmEx. They wouldn’t shoot themselves by hitting just “anyone” with demands for tax returns.
The original article should’ve read “legitimate businesswomen”. :)
Many years ago an AmEx representative said of me “We don’t want his kind.” The shopkeeper wasn’t supposed to repeat that to me, but it made him so mad that he did.
As my income rose in later years, they started sending applications. Keeping in mind their earlier gaffe, I never even opened them...
Very good point
There ought to be a law that forbids companies from sending private information to foriegn countries. We do not have the ability to be represented by our laws under which the contract was signed so we have no contractual recourse.
Perhaps all AmEx shoudl sue them for violation of privacy.
There is a reason Blackrock, the investment arm of Amex is among the worst returns of the investment houses.
I think it should be prohibited to outsource offshore such financial data.
Me. And when I call, I get someone that speaks clear English within 1 button press.
Definitely love my Amex.
The article says that she has three Amex charge cards. Charge cards have to be paid in full each month. Amex has recently allowed some large purchases to be paid over time, but for the majority of purchases, it must be paid in full at the end of each month.
Well Mr. no reason for that, try this one percent possibility:
Husband has a Corporate AmEx Card,
Wife has Corporate AmEx Card,
Couple has private AmEx account.
Well lets see. I have my personal AMEX as does my wife. I also use a corp AMEX card. The key is there are never any balances, never past due. I have only had one instance of a hold and it was on a trip recently where I was in China, Malaysia and Vietnam in the span of 20 hours....it raised a red flag with AMEX...which quite frankly I’m glad it did. I got a “stop” as I was making a purchase...got on the phone with them and it cleared in 5 minutes.
I stand by my earlier comment...more than meets they eye here.
I am a small business owner and I have 3 Amex cards. One for myself and 2 for my employees. My company (ME!) is responsible for making the payment on all of them. So it is possible to have 3 cards and not be scamming.
And Amex decided to apply a limit on my cards without any prior notice. In fact, I was traveling on business so I was really “thrilled” by their action. I had to provide information not as detailed as was requested for Ms Jones. But then again my balances are usually less than $1000 at any given time.
While I understand the need for companies to manage their risk prudently, the recent abrupt actions are causing Amex more reputional risk than they realized.
In lending for the self-employed it is not uncommon for the lender to require 3 years of tax returns to verify income and cash flows.
I’m with you on this. Why did she have three cards?
If AMEX has to absorb consumer bad debt, they’ll just pass along the cost to the merchants and then fewer will accept the card.
Also, as a worker, whose total family income is reportable and subject to tax law, I don’t mind if folks with non-reportable income are now being scrutinized more carefully. AMERX is extending you credit; they have a responsibility to their stockholders and other customers to ensure that you will be able to pay it back
The fact that they farm their customer service out to India is irritating, but I think that American unions have just priced themselves out of the market. I’ve had good and bad results with customer service abroad; same as with domestic workers. If the language skills are good, sometimes you just don’t know where you are talking to. The other day I had an Australian living in Costa Rica answering the phone. As long as they do their job well and resolve my issue, I don’t care; I don’t have a personal relationship with these people.
I am annoyed that my employer has farmed out the phone call center responsibilities to a (domestic) company. I thought that the personal touch was one of our strong points. I suppose that if they found a foreign company that was cheaper they would send the job abroad too. Once you lose the personal touch with your students, do you really care if the call is answered by someone in Texas or Delhi?
I've never understood why anyone would want the standard, high-annual-fee Amex personal card. Most of the no-fee Visa and MC cards have virtually unlimited charge limits, cash-back or other rewards programs, and convenient year-end accounting statements. Plus, many of the places we go don't accept Amex cards because of the relatively high fees Amex charges merchants. I have a number of friends that have the Delta Airlines Amex card for the FF points, but, given the difficulty of using points and the implicit exchange rate, I'd rather have cold, hard cash back. Many years ago, there used to be some comfort in carrying an Amex card when traveling abroad, but that hasn't been an important issue for about 20 years.
VERY POOR Public Relations move by AMEX, no matter how justified by market conditions.
If this happens to me, (I’ve had AMEX since the late 80s, too) they will lose my business.
Sounds like a scam.
No argument there, but it will be a cold day in H$ll before I send them 3 years of tax returns so they can "review" them. There is a lot more info on a tax return than simply gross income. And none of it is any of their business.
I’m so glad to see this post ...just 5 minutes ago I did a search for ‘HSBC reducing the available credit on it’s credit cards’.
Out of the blue and as ‘strictly a business decision’ they reduced my card from 6k to $790. which is nothing.
With that amount we can’t even buy plane tickets over the net...
...we always payed up at the end of the month and it was so convenient using the card as opposed to cash.
Now I’ll book mark this page maybe I’ll find some options.
I had an Amex for several years, and eventually, like with my other cards, I got in too deep with it. (Little-known fact, you *can* actually charge over time on normal Amex cards for large purchases. We had to do it for a $3000 repair to my pickup when it stranded my wife in Atlanta.)
I went into a credit counseling program that worked with my creditors to put me on payment schedules and lower my interest rates. All my other card companies—Citi, Bank of America, Chase—were fine with it. Amex told the counseling service “eff you,” cranked my interest rate to 31%, and sold my account to a bottom-feeding collection agency.
The best part? I worked out a crippling payment with the collections agency and got the balance paid off. With the last payment, the guy said, “Now that you’ve got the balance paid, American Express is going to be sending you an offer to open another card account.” Yeah, RIGHT. I’ve learned my lesson. Membership may have its privileges, but they’re on a mighty short leash.
That’s why they reduced your limit—because you never carried a balance. Credit card companies HATE you. You make them no money. I’ve worked off and on in the IT side of the industry for several years, and this is the kind of stuff you hear from inside the companies. Credit card companies make their money off idiots like me who ran their balances up and then could only afford to make minimum payments (if that) while getting pounded with fees and high interest rates. A smart person like you, who prudently uses their card and pays it off every month, doesn’t produce a profit. So they look for ways to marginalize you.
The number on the back of my card rings Customer Service in Atlanta... I think. I have always gotten an American to help me when I have had reason to call.