American Express revealed new regulatory scrutiny regarding its revolving credit cards its annual regulatory filing.
AmEx said regulators – the Federal Deposit Insurance Corp. and the Utah Department of Financial Institutions – are looking at how its subsidiary, Centurion Bank, has complied with certain consumer protection laws and regulations, “including the way late fees are assessed on charge cards with a lending feature.”
This action by the regulators may include civil money penalties and “require additional refund obligations” to AmEx card holders.
Additional scrutiny is likely being made by the Consumer Financial protection Bureau.
New York-based American Express said that it was notified this month by the FDIC on a pending “formal enforcement action,” and that it appears likely that the Consumer Financial Protection Bureau (CFPB) and Utah authorities will take “some type of action against Centurion Bank as well.”
Details of the disputed late fee terms were not disclosed, but American Express is making reserves for potential late fee refunds to cardholders.
Click here to read more.