Credit-card giant American Express (AmEx) on Tuesday announced a US$75.7 million settlement to resolve charges that it overbilled consumers and misled customers on services provided.
AmEx, a Dow component, is to pay US$16.2 million in fines and at least US$59.5 million in customer remediation, the company said.
The customer remediation is to go to more than 335,000 customers, the US Consumer Financial Protection Bureau (CFPB) said in a statement.
The action also involved the US Federal Deposit Insurance Corp (FDIC) and the US Office of the Comptroller of the Currency (OCC).
“We first warned companies last year about using deceptive marketing to sell credit card add-on products, and everyone should be on notice of this issue,” CFPB Director Richard Cordray said. “Consumers deserve to be treated fairly and should not pay for services they do not receive.”
The settlement resolves a variety of allegations over AmEx’s management of various supplementary products to customers, such as “identity protection.”
In some cases, AmEx charged consumers for identity protection services without the written authorization necessary to provide services, the CFPB said.
In other cases, consumers were misled about the benefits of an “account protector” program intended to offer relief after a major life event, such as unemployment or temporary disability.
AmEx said most of the costs associated with the settlements were already accounted for in previous quarters and that most of the remediation to customers has already been paid.
“American Express has cooperated fully with the CFPB, FDIC and OCC,” the company said in the statement, adding that it “continues to conduct internal reviews designed to identify issues, correct them and ensure that its products and practices meet a high standard of quality.”
Regulators had penalized the company last year for other violations related to credit-card add-on products in a deal that totaled US$112.5 million.
In that settlement, the firm was accused of deceiving customers who signed up for certain cards, leading them to believe they would receive benefits they did not.
American Express shares rose to a record US$88.69 on Tuesday.
The shares have climbed 54 percent this year, the second-best performance in the Dow Jones Industrial Average.
In October, AmEx announced its third-quarter profits rose 9.3 percent to US$1.37 billion.
Apple Inc increased iPhone production in India by about 53 percent last year and now makes a quarter of its marquee devices there, reflecting the US company’s efforts to avoid tariffs on China. The company assembled about 55 million iPhones in India last year, up from 36 million a year earlier, people familiar with the matter said, asking not to be named because the numbers aren’t public. Apple makes about 220 million to 230 million iPhones a year globally, with India’s share of the total increasing rapidly. Apple has accelerated its expansion in the world’s most populous country in recent years, bolstered
HEADWINDS: The company said it expects its computer business, as well as consumer electronics and communications segments to see revenue declines due to seasonality Pegatron Corp (和碩) yesterday said it aims to grow its artificial intelligence (AI) server revenue more than 10-fold this year from last year, driven by orders from neocloud solutions clients and large cloud service providers. The electronics manufacturing service provider said AI server revenue growth would be driven primarily by the Nvidia Corp GB300 server platform. Server shipments are expected to increase each quarter this year, with the second half likely to outperform the first half, it said. The AI server market is expected to broaden this year as more inference applications emerge, which would drive demand for system-on-chip, application-specific integrated circuits
At a massive shipyard in North Vancouver, Canadian workers grind metal beams for a powerful new icebreaker crucial to cementing the country’s presence in the increasingly contested arctic. Icebreakers are specialized, expensive vessels able to navigate in the frozen far north. And “this is the crown jewel,” said Eddie Schehr, vice president of production at the Seaspan shipyard. For Canadian Prime Minister Mark Carney, who heads to Norway next Friday to observe arctic defense drills involving troops from 14 NATO states, Canada’s extreme north has emerged as a strategic priority. “Canada is and forever will be an Arctic nation,” he said ahead of
Chinese entrepreneur Frank Gao used to spend long hours running his social media accounts but now outsources the chore to artificial intelligence (AI) agent tool OpenClaw, which is taking China by storm despite official warnings over cybersecurity. OpenClaw, created in November by an Austrian coder, differs from bots such as ChatGPT because it can execute real-life tasks such as sending e-mails, organizing files or even booking flight tickets. “Since January, I’ve spent hours on the lobster every day,” Gao said in an interview, referring to OpenClaw’s red crustacean mascot. “We’re family.” After downloading OpenClaw, users connect it to artificial intelligence models of their
RSS