If you use American Express to send money abroad, you may want to double-check your transaction history. For more than a decade, Amex targeted small and midsize businesses with promises of low currency conversion rates before deliberately hiking up the rates with no notice, the Wall Street Journal reports.
Amex salespeople recruited clients by offering the lowest rates for sending money abroad but did not notify business owners when an additional charge Amex added on top of the base exchange was raised, according to the report. In 2018, customers paid between .05 and .25 of a percentage point extra, current and former employees told WSJ.
According to the report, when a client inquired about a change, the salespeople would blame a glitch and lower the margins. Small business clients were chosen in part because they were less likely to monitor foreign exchange transactions, the people said.
In an emailed statement, a spokesperson for Amex told Inc. that transactions were completed and reported "in a fair and transparent manner at the rates our customers have authorized." The company also said it will be conducting an external review of its practices. "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."
Employees in Amex's foreign-exchange division, known as forex, used the tactic to boost their revenue numbers, according to the WSJ. The rate increases would often occur after managers told salespeople to review their accounts and adjust pricing. Salespeople could earn a commission as high as 25 percent if they exceeded a $285,000 annual revenue target.
"Who cares if they come or go? Let's make money while we have them," one current Amex employee told WSJ, describing the attitude of some salespeople. The practice of raising conversion rates was reportedly terminated earlier this year after news reports surfaced of similar tactics at Wells Fargo.