The American Express Blues

A few weeks ago I was having lunch with a friend who is a very successful entrepreneur. He told me he'd been having some problems recently with American Express. They'd been denying charges and giving him all sort of grief. Our lunch turned into a support group. Because I've been having the same experiences. We shared our horror stories and I felt a bit better about it.

My friend sent me a link to this story by David Lazarus in the LA Times last week. It turns out we are not alone in getting hosed by American Express. They are doing it to all of their best customers. David starts out his story with the following observation:

What does AmEx want?

That's a question American Express cardholders are asking more and more
these days as the company turns the screws on long-standing customers
and seems determined to show as many as possible the door.

I've been a customer of American Express since 1983 and have never failed to pay a bill. Right now, between my business interests and family, I carry and pay for five American Express accounts. I'm not going to get into the monthly amounts that these accounts turn over, but I will say that they are significant.

The smallest of these accounts is an old Flatiron Partners account. We don't use that account very much anymore, but we do still use it occasionally. A month ago, we were accidentally late paying that account. And as a result American Express shut down all of my accounts without notifying me. My partners in Union Square Ventures could not use their cards, I could not use my personal card, they shut off all of the accounts I have with them even though they were not in any way related to the Flatiron account. I suspect the accounts are linked because they all funnel membership miles into one single account.

But that's just one example of the hassles of being an American Express customer these days. My wife and I are routinely denied when making charges at stores and restaurants. When we call to ask why, we are told that the charge looks "fraudulent". And then they ask us if we really are making that charge. When we assure them that we do indeed want to make that purchase, American Express authorizes it.

I understand that credit card fraud is a huge problem these days and appreciate that American Express protects its customers from the fraud. But I've noticed a 180 degree change in the company in the past year or so and I think they've simply gone too far.

Maybe American Express should offer its customers the opportunity to pay an annual fraud charge that insures that American Express will not deny any charges on our accounts. I'd be happy to do that. I realize they are taking a beating and I also feel that whatever algorithms they are using to detect fraud are often wrong at the most inconvenient times.

As for deadbeats, the credit history of a person should be the single most important data point in determining credit risk. When I called American Express to figure out what was wrong with my cards in the middle of the Flatiron situation, I was told it was their policy to shut down all accounts if there was a late payment on an account. I asked if my 26 year perfect credit with them was material to the situation and I was told it was not. I hung up on them.

I understand the business challenges facing American Express. Fraud and increasing default rates makes for a very unpleasant business situation. But as David points out in his article, they should be careful not to show their good customers the door.

During the brief time I was without all of my American Express cards, I used my Chase VISA card and the experience was not any different. A swipe is a swipe and not one of them was denied.

Reblog this post [with Zemanta]
#Random Posts

Comments (Archived):

  1. john

    funny, i am about to write the same rant, only about a chase card. i suspect economic pressures throughout the industry are driving similar behaviours at all the card processors.

    1. fredwilson

      that’s what my wife said to me. “choose your poison, they are all poison”

      1. Druce Vertes

        I think Visa now does more debit card transactions than credit card.The people left with credit cards are the ones who need them, ie not exactly the most creditworthy.The security of these transactions is awful, but heaven forbid we do anything to make it harder to use the cards.happily Amex-free for 6 years after a horror story.(the consumer protection is much worse for debit card holders – If you get a bogus charge on your credit card, you don’t pay it, but good luck getting money back in your account after it’s been taken out. Also, a problem with debit is the situations where the merchant needs to put a hold on an amount, like car rental or hotels.)

        1. PK

          On the contrary, regarding debit cards, and perhaps it is due to my trustworthy FCU – About two years ago, I had my VISA debit card account number and password somehow “compromised” (perhaps at a gas station with a phony stick-on reader?) and that night the thief used a 7-11 ATM about 15 miles from here to nab $300. (the daily cash limit). At 6:30 the next morning, he/she/they hit another 7-11 ATM 2 miles from the other one and got another $300. before I noticed the activity online in my account. One call to my FCU, and they cancelled the card, overnighted a new card on a new account, and after a one-day investigation, credited back to my account $600. without further questions I like that sort of positive customer service. I felt trusted and valued.

      2. JLM

        Get a USAA Visa card and get a $250,000 credit limit.Get your property insurance from USAA also.USAA is like an old fashioned “mutual” in that you get back your share of profits on an annual basis. If I am not wrong, I get back about 30-35% of my total premium into a Subscriber Savings Account annually — this at already low fees.You gotta trust those Generals! LOLI have no need for such a high limit and cannot imagine why they would grant such a limit but every 6 months I ask for more and they keep saying yes. My actual payment record (on time mind you not actually paying them) is just awful as I am the most absent minded payer in the world but I am making my assistant get better at it.Their administration is flawless, their internet admin is complete and professional and their array of services is incredible. Plus, you can call someone 24/7 and get your questions answered.Their points system is excellent and my family doesn’t even now how to buy an airline ticket any more.As a son of a retired soldier, I am sure that you qualify. You will be happy that you did.

        1. fredwilson

          My dad swears by usaa but when I started out in life, they wouldn’t take meFuck them

          1. fredwilson

            Its too late for them. I dance with the girl who I came with

          2. JLM

            Huh? I think the gal you came with — AmEx — is in the coat closet banging the parking valets! She’s a no good ho! LOLCome on now, you gotta try USAA. You know you want to. Do it for Dad!Just joshing ya, Fred!

          3. fredwilson

            Maybe for credit cards, but I’ve got really good insurance providers

  2. Jeffrey McManus

    Sounds like they’re trying to fire you as a customer because of the one late payment. At this stage your multiple cards look like a king-sized liability to them.The credit cardholder’s bill of rights (which just passed the house last week) should help with this — under the law, the card companies would have to notify you of changes to your account before they go into effect.Seems like two-factor authentication would be a big help here, too.

  3. Howard Mann

    Same experience here. Not only would I ask “What does AmEx want?” I want to know “What does Amex want to be?”Amex has been successful holding on to its, albeit mythical, cache about “Membership having its privileges” but when it no longer does anything to hold it then, as you say, a swipe is a swipe. They are in many other businesses but if you take the desire to hold that card away, the rest will die soon after.Now are the times for businesses to earn loyalty and word of mouth by being there for their best customers when others will not. A great chance for Amex…lost. Here was a chance to for them to be a finance company that did it better than the rest and supported a “member” list that must be superior.If Amex is no longer THE credit card company then who are they? And if nobody cares then nobody will care about “what they want” anymore wither. Pity.

  4. dave

    Just a guess that it has nothing to do with you but more to do that the financial industry is in turmoil now. Maybe they’re having liquidity problems?We see it in different ways out here (I don’t have an Amex card, btw). Yesterday I had some business to do in downtown Berkeley and planned to stop in one of the better pizzerias in the Bay Area, in a college town — and it was out of business. You see that so much these days, solid businesses, that in normal times wouldn’t ever close, or even in a normal recession would find some way through it — they aren’t getting through this one. Lots of businesses closing..http://www.yelp.com/biz/ari…Anyway — there must be a silver lining in here somewhere! 🙂

    1. fredwilson

      Hi Davehow is the pizza in Berkeley?i think there is a silver lining which is that after the forest fires, the trees grow back

      1. Scott Yates

        It may not be the same kind of trees that grow back!I agree with all the commenters on this post, and I agree that if someone comes up with a better way I’ll jump all over it. We’ve been roughed up by a couple of the card companies, but AmEx has been the worst and I have cut all ties to AmEx forever.Times are bad, I get that. But what do they say about friendship? Something about how you know whom your true friends are when time is bad. It’s the same with service providers, and AmEx has shown that it is not a good partner when times are bad, so why should I give them my business when things improve? Only to have them whack me again some day? No thank you.

      2. JLM

        Wow, I must be living a charmed life!I have used AmEx Gold Corp cards for my companies for over 30 years and have never encountered any real problems except for their inability to change the name of the “administrator” on the accounts — new CFO takes about a year to get straight! No problems of any kind whatsoever.On a personal basis — a huge disaster about 10 years ago when I disputed a de minimous amount ($22) w/ AmEx (not a vendor) and they cancelled my account. They dropped me like a hot potato. We agreed to part company. This was during good times.The magnitude of the disaffection demonstrated by this blog is incredible. I don’t think you could piss off this many sharp and influential people with hate mail!I suspect the credit card companies will be the next guys in the ditch — can’t wait for the ObamaKard. You use it and the bill goes to the top 1% earners in your neighborhood!

        1. fredwilson

          that would be me

    2. secorp

      The pizza is great in Berkeley/Oakland though we do mourn the loss of Arinell’s. Try Gioia in north Berkeley near the Monterey Market, Zachary’s on Solano (north) or College (south), or Arizmendi’s in Emeryville. Since moving from NYC, those places help keep me sane :)http://gioiapizzeria.com/http://www.zacharys.com/http://www.arizmendi-bakery…

      1. fredwilson

        Thanks! now I know where to get pizza next time I visit

        1. harpos_blues

          Fred,When I lived in Oakland six years ago, my favorite pizza joint was Pizza Rustica in Montclair Village or Rockridge:Pizza Rusticahttp://www.caferustica.com/Yelp: Pizza Rusticahttp://www.yelp.com/biz/piz…Warning: Parking in both Rockridge and Montclair Village can be challenging, allot time and patience.

  5. kidmercury

    no worries boss, this is the internet, you don’t like the way your economy is being managed, you can just roll your own

    1. fredwilson

      indeed

  6. awilensky

    One of my best buddies us an IS analyst for the financial industry. He knows the in-out of Amex’s centralized scoring and fraud detection center, and many of the key personnel, he claims, have turned over.

    1. fredwilson

      that’s a big problem, if true

  7. Michael A. Davis

    I am in the same situation, 6 cards, 3 business cards, and 2 personal cards. I had the same experience where we missed the payment by 1 day and all of my cards were shut off as well, including all the business cards (I have one company with 20 employees with cards that they use almost every day so this was a major SNAFU).According to AMEX’s risk management department, with whom I spent an hour on the phone with, the problem is accounts are linked by guarantor. Now, I too have a long history with Amex and never converted my business accounts to NOT be guaranteed by my personal credit as we grew. There was never a problem so I never thought about it. I am assuming you are in the same situation. If you filled out the app to sign up for the AMEX business card and provided your social, it is personally guaranteed.The solution? Move your business accounts to be guaranteed by the business’ credit. We filled out 2 forms with AMEX and provided 3 years of tax returns and the business accounts are now not guaranteed by my personal credit and we were assured that any issues going forward on one account will not cause problems on the other accounts.NOTE: Only business with $1mil+ of revenue for 3 years will be accepted.Hope this helps!

    1. fredwilson

      that is very helpful advicethank youyou’d think an amex customer service rep could have told me that!

      1. Michael A. Davis

        So maybe I shouldn’t have been so quick to say AMEX is good.Monday morning at 10AM, a day aftter my comment, my senior accountant notifies me that even though we have been on our “business credit” with AMEX for about a month. We were notified by a Senior Risk Manager at Amex that our credit line was being reduced from over 100k to 5k for one of my companies. Yes, 5K and it is effective within 15 days. This was because an automated risk analysis scan detected our new business account had a decrease in “gross profit”.We are current contesting this and the Risk Manager my senior accountant spoke with didn’t have any details on why other than “your gross profit decreased last year”. I responded with, how can you deduce Gross Profit from a tax return? Furthermore, our gross profit has increased year over year for the past 3 years!Hopefully this story will turn out better 🙁

    2. Charlie Kroll

      We’re going through this same process now. Our business has had corporate platinum cards for 8 years which I personally guaranteed. One day recently we got a call from someone at Amex letting us know we qualify for a corporate card, to which I said “thanks but we already have that.” They said no, you have an OPEN (personal) card with the corporate logo, and that if we move over to the real corporate program, which is based on the business’ credit (three years tax returns as noted previously, etc), there is no personal guarantee. We’re going through the paperwork right now. So to the poster above who said Amex told them all corporate cards are personally guaranteed, including GE’s, I can confirm that’s not true.

  8. disqus_fsHeMCHqSt

    I had this same type of issue late last year.Perfect payment history and for no reason at all, big issues when using the Platinum card.Like you said Fred, a swipe is a swipe and I’m only swiping a VISA these days.Ciao Amex and good riddance.

  9. scottythebody

    We used to pay with *everything* through our Amex cards. The service we got and the reward points made it all worthwhile. Sometime during the last two years we’ve migrated almost completely away from their card. Being internationally-based, apparently, has made it almost impossible for Amex to provide us service. More often than not, the card lets me down. I can barely use it online because it almost always get rejected. Charges done in shops seldom work. And yet the account is in good standing and we’ve never once not paid off the balance in over 12 years. Unbelievable.

  10. Eric

    Yep, Amex has increased their “is this a fraudulent charge” phone call frequency on my account. It’s kind of weird when I have the same charge from the same vendors for the past 2 years and now it’s triggering some sort of fraud flag in their system.I also have been getting frequent calls on when I’m going to pay my bill. The irony of this is it’s usually within 48 hours of the previous period close. To stop them harassing me 2-3 times a month, I now pre-pay my card down when it gets to a certain limit. PIA, but it’s too much of a hassle to switch cards when so many of my vendors are tied to my Amex.While they do have some exposure with my high balance, they are getting great fees from all the transactions and in 4 years, never have missed a payment. Should count for something, but we are all just numbers to them.

  11. Geoff

    I had similar problems with paypal. Customer history counts for nothing these days, there systems re not up to it. Apparently in South Africa they send a text to your phone if they think a charge is fraud, you can then text back if it is indeed OK..

    1. fredwilson

      i like the south africa techniquei’d go for that if it was quick

      1. stuart

        Just hope your phone doesn’t get stolen along with your wallet…

  12. Anonymous Coward

    I’d had an AmEx Platinum card for nearly 30 years, never missed a payment. Last year I wanted to arrange for the card account to be paid automatically from a bank account. AmEx said sorry, the auto-payment feature wasn’t available for my card, even though the feature was offered on their website. I escalated through SEVEN layers of managers, being stone-walled at every level, until the highest VP finally told me that AmEx cards with older numbers were handled on a different computer system which couldn’t be upgraded. My only option was to cancel my Platinum AmEx and open a new account, which would have a new number and be hosted on a newer computer system where auto-payment was available. This was so incredibly incompetent that he convinced me that it must be true. Plus, I realized that neither AmEx nor Platinum carries any prestige any more. So I canceled my Platinum AmEx, applied online for a new minimum-cost Green AmEx account (approved instantly online), and set up the auto-payment for the new credit card account. Works much better, and the only difference is that I’m no longer paying several hundred dollars annual card fees. If the seventh-level-executive explanation to me is true, AmEx must have an IT operation that is colossally mis-managed, so anything (including the intrusive fraud false-alarms) could happen easily.

    1. Neil

      You think that’s bad?AmEx is the first (last?) system I’ve used that requires that passwords are shorter than 8 chars since…what…Windows 98?

      1. Joshua Reich

        And no special characters… All of my financial accounts have long complex passwords. Except for my amex password. I spent a few weeks trying to speak to someone who would explain it to me. Eventually I was put in touch with one of their developers who had the gall to tell me that ‘special characters’ are a security risk. Wow. Just wow.Now that they’ve cancelled their free business class travel with any business class airline ticket, I’m pretty close to cancelling my accounts with them.

  13. AJ Kohn

    Plain and simple, the default rate at AmEx has been extremely high.”Analysts say the company, confronting soaring default rates on its cards, is trying to limit the damage to its own finances while cutting ahead of rivals in line to be paid back. The default rate on AmEx cards soared to 8.3% in January from 4.7% a year earlier, according to data from the trust that handles the company’s consumer lending receivables.”http://money.cnn.com/2009/0…They don’t want *any* added exposure or risk. Now, could they target at-risk customers in a better way? Probably. Do they have the time and ability to do so while the business is crashing down on them? Probably not.

    1. fredwilson

      wow. this explains a lot. but i still think a customer with a 26 year perfect history should get the benefit of the doubt.

      1. JLM

        Obviously, they cannot define what a “customer” is. Anybody with a brain would make a valuation assessment based upon the length of the relationship and the annual income from that relationship tempered by any short term change in the payment pattern.It takes years to create a “loyal” customer and only 5 seconds to lose a loyal customer!Am Ex is giving the post grad course in how to destroy loyal customer relationships.

  14. MarinaMartin

    This is a purely anecdotal observation, but it seems like fewer real-life businesses are accepting AmEx these days. (This may be a Seattle thing, though.) When credit cards at drive-thrus and small businesses really start taking off 5-7 years ago, I was willing to overlook the places that took Visa or MC and not AmEx because I knew there were higher fees involved … but at this point, it seems like the more “exclusive” card should be in *more* places, not fewer, because it means I absolutely must have a second, non-AmEx card.Their travel service has always driven me nuts, too. After six times — in a row — of their Centurion extra-special travel experts informing me there were zero tickets from A to B, when kayak.com showed literally pages of options, I refused to call them ever again. Not to mention their obnoxious policy about repeating everything back twice, taking forever when I could do the same thing online in four minutes. I’ve heard “friend of a friend” rumors of their concierge service being helpful with odd requests in a pinch, but never heard such a story directly, and Twitter/Google pretty much fills that need these days anyway.

  15. bijan

    I don’t know why I have an am ex card anymore.the whole point was to have better customer service.but if that doens’t exist then what is the point.

    1. leeschneider

      Somehow lost my Amex at a restaurant recently on a Saturday night. Didn’t realize my error until Tuesday. Called for a replacement card. Took nearly two weeks! How is that customer service? There’s something called Overnight Mail that seems to work wonders. I would have even paid the $20. When I called back after 7 days, I was told that Overnight mail is only for “Special” circumstances. Gee, thanks.

  16. Mark Polino

    I worked for a small business. Founders didn’t want to personally guarantee the corporate Amex. While on the phone with Amex discussing the situation, founders were told “all corporate Amex accounts are personally guaranteed”. Founder replied: “So Jack Welch personally guaranteed all of GE’s Amex cards?”. Answer: Yes. Perhaps this is why CEO’s need such large salaries these days.For a while Amex was routinely denying my charges because a $25 payment had not been properly applied on their end. Amex has been a pain for years and the recession is bringing out the worst in them.Mark

    1. example

      Perhaps this is why CEO’s need such large salaries these days.LOL.

  17. Daniel

    Adding my voice. Same problem with Amex. Pity because they were one of the few big companies where history with them mattered.

  18. example

    This is a huge problem caused by the misuse of statistical datamining. People think “hey this is 99% accurate at detecting fraud, let’s use it!” but they don’t realize that if there are 100,000 good transactions for every fraudulent one, then 1,000 good will get flagged for EVERY SINGLE FRAUDULENT ONE!There are tons of snake oil salesmen out there perverting statistics who don’t understand what they’re selling to people who don’t understand what they’re buying. It’s disgusting. And it’s also a much greater burden on people who are at the lower end of the socioeconomic spectrum, because they have no way to ‘appeal’ the problems. A poor credit rating or errors can prevent people from getting loans, getting a job, getting an apartment, all kinds of problems that related to these statistical models that might not even work!

  19. Robert Levin

    I am somewhat relieved (although equally distressed) that I am not the only one this has happened to in the last few months. We have 5 card accounts, 2 personal and 3 corporate. One is the “Blue” card that we opened to separate employee charges from everyone else. 90 days ago the credit limit was $41,000. We have been with Amex for 12 years and never missed paying our bill in full at the end of each month. To give you some idea of the turnover, we’ve turned down the Centurian “Black Card” on more than one occasion. Most recently in January of THIS YEAR.While changing banks in Feb, we paid our Blue card 1 day late. The amount…$112. Like yours, all of my accounts were frozen. I received a call at my house, another at my office and an email informing me that there was a problem. I was in London on a trip at the time. When I called the 800# to see what was going on, they had already received the payment and things were put back right. Until I got an email from them informing me that my credit limit on that account was being lowered…to $3,500. The next month…another email, account limit reduced to…$1,100. They kicked us out. Our office supply bill, which was automatically put on this card is more than that each month.As was the case with you, I called, spoke to all the nice people and our past history meant nothing. A very successful commercial real estate investor I work with has a saying that he got from his father, another successful real estate investor that goes something like, “The tennant you know and have a history with, even if that history involves late payments and issues is better than the one you don’t know but might look good on paper”.I canceled all my cards but one which I switched from Platinum to Green solely to keep my points (more than 700k). For a no limit card I now have a Platinum Diners Club (great for int’l use and the MC tie in is great) and a Chase Visa replaced our “Blue Card” the next day. (Credit limit $34,000)If the company keeps losing customers like us, they will be left with only those who can’t go anywhere else or the ones who “look good on paper”. Do you think that’s what they want? Because that’s exactly what they’re going to get.

    1. fredwilson

      wow. that’s a very damning storyand not that different from what i experienced

  20. Seth Lieberman

    Wow, this is an unreal thread…and I though I was the only one all this time. What is clear is that lots of well-heeled successful ceo, vcs and entrepreneurs are now saying Amex is not worth it…this is such a counter intuitive idea given historical prevailing wisdom. I just opened a Virgin America card, perhaps they will adopt their same customer-centric focus in finance as well.

  21. Beverly

    Same thing here. I believe the late fee is part of the IS department – in my case the min was increased by $1.00 and because I pay electronically via my bank, it missed. That triggered the late fee and a “review” of my “ability to pay”.Although I’m under no illusion that this will help, I wrote a letter to the CEO of AMex, copied Senator Chris Dodd, Congressman Henry Waxman, the BBB, Department of Consumer Affairs, the Attorneys General of NY and CA (I’m in CA). This is the last part of my letter if anybody wants to try as well:”… Is this really your business model – play tricks with billing and potentially cripple the small business owner?This is unacceptable. I am a tax-paying small business owner who relies on modest credit lines to maintain and grow my business. I am never late, have excellent credit, and now, because of the bad financial decisions made by you and other American Express senior executives – who have received government assistance, by the way – I am penalized. I appreciate you may be trying to dig out of a very deep financial deficit – but it won’t be at my expense.I demand this be remedied in the following ways:1.Remove the late fee of $38.002.Issue statement to me and all three credit bureaus rescinding late fee3.Restore my line of credit to April 1, 2009 level”Use it if helpful…

    1. greggd

      another sucker punch from Amex is the bound appointment calendar they send you. for years i thought it was free for being great customer…not so…they just padded the bill. odious. we will review whether to keep amex in light of the comments here tx.

  22. john demayo

    I’ve had some really bad experiences as well recently. I used to run $80k-$100k a month on the card for PPC charges, and have never been late paying. They started cutting my credit limit back to “the average of the last 6 months charges” (which forces a decline in credit limit), and then when I started just putting the charges on another card, cut my limit back to $3k. They do not seem to be doing a very good job of distinguishing between profitable and unprofitable customers IMO, and seem to just be cutting everyone’s credit back as hard as they can.

  23. Dan Cornish

    Why is anyone using credit cards anymore?? Use cash or a debit card. If you do not have the cash in the bank then you can not afford it. Simple. Also by paying merchants in cash you will be giving them a 3%-5% increase in their profitability immediately. Talk about helping the economy. I would argue it is our duty as Americans not to use credit cards. Show you patriotic spirit and pay in cash or if you must use a debit card.The old argument, I need a credit card because I can not rent a car is bogus. Debit cards are fine.

    1. awatterson

      Are you arguing that our economy would be stronger without the existence of credit? That only transactions that can be done in cash are sound?

      1. Dan Cornish

        What I am arguing is that our local merchants would be stronger and could create more jobs if we stopped using credit cards. American Express will not create meaningful jobs. I am arguing that when you borrow money, you become a slave to the lender. So if you use an American Express card then you have to eat whatever kind of shit they feed you. Everyone should stop complaining. If you pay cash there is no third party involved. And yes I am arguing that if we stop running deficits and stop borrowing money our economy will be stronger. The only people who get hurt by not borrowing are the bankers.

        1. awatterson

          Couldn’t it be argued that merchants have built in the cost of credit transactions into their costs? So that by paying cash you are subsidizing credit use? So as long as pricing is consistent *and i think it has to be based upon Credit Card companies terms of use* that it’s foolish to pay cash and subsidize the cost of someone else’s convenience.That aside, I think you have to separate good credit use from bad credit use. People putting flat screen TVs on cards because they don’t have the $ is one thing.Using credit for a business, or using credit for education or for cash flow purposes, etc etc., is a whole different idea.You may think that only Bankers benefit from borrowing, but how many people couldn’t go to college or start business or make long-term investments in property without borrowing? Certainly they’d be hurt too?

          1. Dan Cornish

            What I am arguing is that by not paying by credit you immediately send another 3%-5% directly to the bottom line of the merchant. If you pay by credit you are sending 3%-5% to American Express. I argue that making merchants stronger is far more important than making American Express stronger. And I will restate that it is a patriotic thing to improve the profitability of your local merchant and not American Express.The only good use of credit in business is to buy plant and equipment to expand and make more money. A bad use of credit is to use it to falsely inflate earnings, or to mask underlying problems of a business. This I argue is a majority of the use of credit in business. For instance, the private equity firms loaded up firms with debt to take out their profit while leaving a empty shell of a business. This by the way is the next shoe to drop in the credit crisis. In the next three years, term loans will need to be refinanced.This flawed argument is the reason why College Educations cost more than $20-$50k per year. Easy availability of credit is the main reason why Universities are so inefficient. If credit becomes less available, than the economy will adjust. As universities begin to loose students, then they will have to adjust their prices to compete. Universities are some of the least efficient institutions there are. And do not get me started about the value of a college education. I think way too many people place too much importance on College. Some of the most impressive people I have ever met dropped out of college, and conversely, some of the most inept I have met have advanced Ivy League educations.

          2. Druce Vertes

            I was going to agree and point to the absurdly high merchant fees… but then I Googled amex vs. Visa merchant charges (love the Internets), and according to Wikipedia Amex now charges 2.5% on average vs. 2% for Mastercard and Visa (1.7% for debit cards).it feels like that is part of the story – Amex used to be a premium product; they would charge high fees; the type of merchant their loyal customers preferred had to accept Amex; Amex would reap the benefits of a fabulous brand. In going more mainstream and taking on more credit risk at a bad time they may have put themselves in the unenviable position of having to break the promises that came with the brand.the 2% range is not crazy high – if you look at the cost of doing business with cash from your local bank, after you take into account the foregone interest from cash balances, and absurd fees, you’re back up at 2% pretty quickly. Maintaining a branch infrastructure is an expensive proposition.I was an earlier adopter of Internet banking with First Security and Netbank. They are not with us anymore. I’m not sure why, but that expensive model is sticky. Or maybe it just takes a little longer for old money habits to die, vs. say patterns of media consumption.

    2. Mak

      Debit cards only work with very few rental companies, and even then they want to have proof of residence, (like a utility bill) and a paystub. The rational got from Enterprise Car Rental was that by using a credit card, you had already been screened by the Card company, and thus didn’t have to prove anything. I use cash (debit card)exclusively, and found that to be an utterly bullshit argument. Why would someone with a crappy credit history but having a credit card account be a better risk than I am?I’m like you…cash is king ALWAYS, but with car rentals, its another story.

    3. fredwilson

      i find credit cards easier to manage from a reporting and accounting perspective

    4. DC

      This is just plain silly. Why NOT use a credit card or better yet, a charge card to pay for some expenses. As long as you’re disciplined enough to pay off the charge every month, there’s no harm in earning miles or points. That’s the rub – you HAVE to pay it off every month. Amex also provides extended warranties on purchases so there are additional benefits, er, privileges.Also, more importantly, my company does not provide corporate cards so this is why credit cards are required for me. I’m not going to shell out thousands in cash each week for travel.

  24. natarem

    A friend of mine recently had a bad experience as well. For some background, he’s been an Amex customer since some point in the 90s and he’s had a business card for about five years — and the business card monthly charges are very substantial.When he went to buy a boat for a high five figure amount, the boat brokers told him that they would allow him to charge it on his card. To avoid the hassle involved with sending a wire, he decided to call Amex to make sure the purchase would be okay. He spoke to Platinum support and they saw his history and said “sure, no problem”. A few days later they attempt to put the charge through and it says they need to call in. So they call Amex and they say that the charge isn’t allowed without getting confirmation from his bank that he has the money to pay the bill — which is a completely different answer than what he was told a few days before. The Amex rep said something like “did you confirm with a supervisor that the charge would be allowed?” at which point my friend said “seriously? Now I can’t even believe what your Platinum support is telling me?” and proceeded to go through the bank confirmation process.Although they did allow the charge to go through after 30 minutes of wrangling and bank confirmations, they added in a pretty hilarious caveat: he couldn’t make another charge on his Amex until he went online and paid his bill for the boat. A day or two later he tried using his Amex on a small charge even though he hadn’t paid the bill yet. It went through. Basically they didn’t have their shit together on ANY front.Really absurd.

  25. Chris Dodge

    I’ve never been sure what the appeal of an AmEx card is in the age of the Debit Card. Mine is MasterCard debit against my nicely appealing local credit union bank: Direct Federal in MA.I think consumer credit debt is the next big black hole (albeit a lot smaller than mortgages). Not surprising to hear of AmEx tighenting the screws in terms of identifying additional fee opportunities.Best of luck wading through the quagmire.

    1. fredwilson

      for me the appeal is accounting related

    2. Marc Angelico

      I live in NYC, but still use Direct Federal Credit Union. Simply the best customer service around, and no fees.

    3. Jerry

      The problem with debit cards is that any fraudulent transactions that go through take money out of your account immediately. Even if you can get the money back, you need to go through the hassle of requesting/begging the the money be returned. You also need to deal with any overdraft issues that this might cause. Your liability for a fraudulent credit card transaction is limited to $50 by federal law; your liability for a fraudulent debit card transaction is dependent on your banks policies.As long as you are smart about using your credit card, they make more sense than debit cards. But I do agree that there are a large number of people who are not smart about using credit cards, and for those people a debit card might make more sense.

  26. e.p.c.

    I switched all of my routine spending away from AMEX after being stuck at 1:00 a.m. at O’Hare with a cancelled car reservation due to AMEX bouncing the card. The cause? While I’d paid my bill, I’d paid within 24 hours of when it was marked to be late, and thus therefore *was* late according to their system and I was being disingenuous for paying the bill as late as five days after the close of the charge period.I have zero plans to go back to relying on AMEX for personal or business transactions.

  27. turph

    Funny, as I just got an email from them stating a fraudulent transaction on my card this afternoon. Called, no hassle, getting a new card in 7 days.What this event, and these comments, makes me think is a plastic card with a number seems rather odd in todays world. Do other countries which use cell phones for payment have the same fraud rate? Are there other ways this could/should be done? Or is fraud simply fraud and we are stuck with this model?

  28. Fred Krueger

    I had an Amex platinum card for years, and naively believed the commercials that said that “i was protected”. Then, i gave my card info to a home improvement company for “incidentals”, meaning small repairs to windows, restocking the fridge etc.little did i know, after 6 months, my contractors hit me with a $300,000 bill for various (non-existent) repairs and services. I complained to AMEX but they would have none of it. They insisted I pay them in full, despite the completely fraudulent claims. They turned my account over to a collections agency and started calling me at 3AM. Eventually, i paid.I ended up suing the home improvements company and won. Of course, by then, they had declared bankruptcy, and all i ended up getting was a percentage of my legal fees.The moral of this is to be extremely careful with credit cards. AMEX in particular is far from the “watchful good citizen” portrayed in their ads. But I am not sure Visa or MC would be so different. My personal solution is to keep a tight limit on charges.

    1. MJbos

      Good advice to be careful with credit… speaking of being careful with credit, I hope you have now learned from you experience. For those that don’t know, you lose your rights to dispute invalid charges after 60 days… but that wouldn’t have mattered in your case, you lost your consumer protection rights when you willingly gave posession of your card to a third party. You also violated your contract with Amex, the agreement and the card itself clearly states that the card is “NON-TRANSFERABLE”.Are you sure you were getting calls at 3am? That would be illegal and actionable (to the tune of $1k/call).

  29. Rob K

    Fred- Similar experience with Amex. I am a 15 yr Platinum card holder and I had my extended payment feature revoked due to a reported late payment (for $50) from another creditor on 1 credit report. This was a bogus charge, and only on 1 of the 3 reporting agencies, but Amex didn’t bother to look or tell me why they revoked my privilege. I will be scaling back my Amex spending dramatically. How stupid to mistreat your best customers.

  30. Ro Gupta

    Slightly off-topic, but an AMEX rep should SO be involved in this thread. Don’t think they’re on Twitter either.This conversation alone could lose them tens of thousands of dollars in future fees, even if just a handful of AVC readers read about everyone’s troubles and decide to say bye-bye for good. I’ve actually been quite happy with my AMEX services over the years, but now I’m getting nervous seeing all this and would like to be reassured.AMEX, chances are you have reasonable answers to some of the concerns. Worth your while to get in the mix and engage.

    1. greggd

      Ro…ok so AMEX isn’t here. But what if they were? What would you say? What do you do when la merde frappe le ventilateur on the internet? Anyone one to take a stab so i can learn how next time it’s my turn to be in the hot seat?

      1. Ro Gupta

        Gregg, I’m sure others could give you a much fuller answer chock full of case studies and such.. But I think the main thing people want are simple, authentic, and if possible actionable responses to some of the issues brought up in association with the brand or product question e.g. “We understand the concern regarding our fraud protection , but please be aware that we do maintain an industry-leading effectiveness rate in identifying fraud, and we provide a number of options for expedient dispute resolution, which can be found here: americanexpress.com/_____. Please contact our member services department with additional questions here: _____. Thank you, Susie Q, AMEX Customer Relations” That sort of thing…________________________________

        1. fredwilson

          ro – i’m sure you saw this, but if not, AMEX did weigh in on this thread, and supposedly its the first time ever that an amex employee was allowed to make an “official comment” in a blog comment threadand it happened on disqus!

          1. obscurelyfamous

            I saw Marcy contribute to the thread and I think that’s awesome! Also… this is a semi-worthless comment but I’m testing the newest upgrades to Disqus’ tweet-comments.

          2. Austin Bryan

            So what would show up in your tweet (“RE: @fredwilson I saw Marcy…”) if Fred didn’t have his Twitter account registered?

  31. Ken

    Similar situation here. Although I am only 23, I have a personal AMEX (Platinum), as well as 2 business AMEX’s for the company I own. I have NEVER missed a payment, and charge about 50-100K per month between all of the cards (mostly business). My credit limits WERE 75,000 on Personal, 50,000 on one business and 150,000 on another business card. My company is cash intensive, with all purchases being online, thus charged to my credit card. Amex recently reduced my credit limits to 1200, 5000 and 7500 respectively. They just lost a customer, as I can not run my business with this little amount of credit (unless I paid a large sum to build a credit.. but no way I am doing that). I switched to MasterCard, they gave me a 250,000 credit limit, and I am happy again.

  32. Jack Barber

    I have a Chase plantinum United miles visa. Fraud controls are in disarray there too.Routinely denies my VERIZON BILL which I pay every month; charges at stores within half-mile of my house; etc.Nightmare.

    1. Joe

      Citi is doing the same thing to me. Never, ever missed a late payment. Now, every other charge I make results in a fraud warning and getting my card disabled.The only guys not doing this are Discover. I f*cking love them. I hope they get a ton more business from the disgusting way that AmEx, Citi, and Chase are treating their best customers.

  33. Alan Warms

    Same thing happening to me, but with Diners Club. Gotten so bad that i paid a large balance, early, before leaving on a trip out of country. when I landed in Carribean, i got message from fraud department. I called back assured them of my pre-payment, told them i was out of country, etc., but they basically shut down my account and almost cost me my flight back. Same runaround.Must be industry wide.

  34. James Albert Clark

    Hey – try the Chase/Continental “Presidential Plus” MC. Same fee as the Amex Platinum – but full membership at Continental’s Presidents Club, free “Elite Status” on Continental plus tons of multiple miles awards through various vendors as well as standard mile/dollar award on all purchases. If you are on Continental a lot, it’s a no-brainer. My Amex has been gathering dust.

  35. Guest

    I’ve had similar problems — I have a personal AmEx (five years) and a small business platinum (three years). No late or missed payments, no going over the limit. There have been periods when I’ve paid off balances in full, and others when I’ve carried. My overall credit standing is just fine. Yet, they’ve cut my small business limit by 1/3, altered payment due dates (the past three months — no kidding — my payment date has fallen on a Sunday. I’m starting to feel paranoid that they’re *trying* to trip me up), and have flagged payments to vendors I’ve worked with before as fraudulent. It’s bizarre and frustrating, and it adds a bit of anxiety to running a business that I could do without.

  36. Edward Kim

    I had the same problem recently. I got a letter out of nowhere from AmEx saying that my credit limit would be reduced from 25k to 18k. I never missed a payment on any accounts whatsoever.

  37. Ryan Kiskis

    I’ve had a similar experience. Run 4 AMEX cards, some charge, some credit. They recently canceled the pay-your-travel-expenses-later program on all my charge cards…which they practically begged me to sign up for a year ago, thousands of extra points, etc, and I had never once. All my credit cards have had their limits reduced to 1/2 to 2/3, despite paying them on time, every time. I believe they are considering the corp cards I set up for my startup as part of my credit rating, despite the completely separate finances, so it’s impacting my company as well.I’m not an Amex aficionado like some I know, but I liked their services & offerings. Got saved by baggage protection a few times. But at this point, I’ve been using the Visa more and more often…

  38. Mihai

    I’ve also ran into problems with AmEx. I had 2 accounts. One was unused, so when the annual fee posted, I closed the account, or so it said the customer service. When I saw the charge was still active online I called them again. They said not to worry. Then, next month I got a bill, so I called again — same thing: customer service said not to worry and that the online system is out of date… I called them every month for about 6 months. My bill was still active. Then I got another letter saying that my credit limit on the other account has been reduced (to a pathetic limit) because one of my AmEx accounts was past due. At that point, I contact the customer service again, and they did remove the charge and closed the unused account. However, I couldn’t get my credit limit reinstated, because I had to talk to a different department, etc.I got cross with them and now I’m using other cards… too bad as the AmEx had the best cash back.

  39. Mat

    I have just shut down my Amex Platinum charge card after eight years of use. As a result Amex loses a £300 per annum annual fee.Similar reasons… unexpected payment failures and a curtailing of what was an “unlimited” spending limit when I took out the card. Amex was unable to look at my credit history or use of my other Amex card to set an appropriate limit. They actually wanted me to send them payslips and copies of bank statements – at which point I cut the card in half and sent it back.Amex need to understand that there are lots of card companies out there that now provide premium services (travel, concierge, travel insurance, etc).

  40. Jeremy

    You’re a smart guy. AmEx makes money on you — you are a customer. If you and everyone you knows just cancels your accounts with AmEx, they will be forced to change… but, they know that you want some of the conveniences they offer. You want your miles or your rewards and will be reluctant to leave. Thus, they can treat you however they like. That’s the problem with just about every business anymore. Capitalism hinges upon the power of the consumer to chose, boycott, and affect the market. Today, we consumers are so disorganized and disloyal that nothing counts. I can’t hate AmEx and yet suffer along with their policies. To do so is to affirm that they can get away with these practices. Now we consumers have the cold-start problem. I don’t want to be the first to bail if no one else is going to. I cannot boycott alone and I don’t want to give up the perks I get for nothing. Neither do you. Neither does anyone else. This attitude is pervasive, sinister, and deadly. It affects not capitalism, but politics and religion. We need people to not just imply that Chase VISA isn’t appreciably different than AmEx; we need leaders to step forward and say: I’ve cut my ties with that company for as long as it takes them to enact better policies. I, for one, have. I cut ties with AmEx and with BoA for policies that may not have always affected me, but with which I disagree heartedly.

    1. fredwilson

      Excellent points. I will take up the idea of a complete break with amex with my partners and my wife

  41. AJ

    wow, this is a great thread and good revelation that only if we knew we are all not alone. So here is the negative of being a card member with AMEX, I own retail businesses and one of my employees racked the bills and disappeared, unfortunately Amex did not buy that story and I had to pay for the employee, who was cardholder under our company. Not ot mention they froze all my accounts and the hassle made me leave them as a customer. The positive here is, AMEX is great to their business customers, not sure if you know in retail if anyone makes a purchase online or via the phone and they use a stolen card, AMEX supports the merchant if they have a signed receipt and VISA and MC do not buy that and the merchant is screwed, regardless if you have a signed copy with the 3 digit CVV code or not, you have to digest the fraudulent charge.

  42. howard lindzon

    wierd …your cards have been working fine for me.

    1. Louis Berlan

      Ha!

    2. fredwilson

      So that explains the thousand different ….twits.com domains that were purchased with my card!

  43. Louis Berlan

    A couple of things surprise meIsn’t the idea of having uber-[insert hideously expensive metal here]-status that the “annual fraud charge” is pretty much included? i.e. customer service sorts out fraud issues post rather than pre-fraud? I thought that was one of the basic ideas of Amex.Also, and more importantly, you’d think that if they’re going to come up with great algorithms to process fraud, fees, charges, etc.- and I think it’s a great idea that they have one – they could add a few customer service variables, the kind of thing that a supervisor would take into account (credit history, “seniority”, amount charged, etc)I’m wondering if it’s not a sign of a temporary dip in customer service: companies have cut costs by adding technology, but the models might not be up to standard (yet). In my experience, it’s happened only with financial institutions – others have really embraced technology in CS, leading to awesome service and consistency (especially important).

  44. Saul_Lieberman

    I just got a notice that Fidelity’s risk department was terminating one of my accounts (the one I use mostly as a checking account). I’ve been a Fidelity customer for 15 years (investment, IRA and 401k) and have not bounced a check. The Risk Department has refused to provide an explanation.

    1. fredwilson

      I think this thread shows that the entire consumer finance sector is guilty of abusing their customersTime to start a new one

      1. ben reytblat

        Great idea, Fred! We’ll call it “The Customer Card”. It’ll be about as expensive for the customers as AmEx, and no more expensive to the merchant then Visa/MC. The main value diff will be customer service and fraud detection/protection services. If you fund it, I’ll run it. 🙂

        1. fredwilson

          I’m thinking about it

  45. Gotham Gal

    As a rule, I prefer using AMEX to call other cards. They don’t even bother looking at your credit history these days. I made a purchase at a store that I shop at at least once a month and they stopped the purchased until phone calls were made. The third time around calling, I ended up with a supervisor who has now fixed the problem. I can understand the fraudulent issues they are having but in the end, they are going to just piss off their customers as they did with me. But, where are we to go? VISA’s are bank related, Amex is one company and they are very efficient when you need them to be with one call. No other credit card company, that I know of, works that way.

    1. Beverly

      Amex is now a bank. That’s how they got bailout money

    2. Rachel

      As always – I’m in agreement with Gotham Gal.Hopefully we’ve riled them up at AmEx…these are the people who CAN pay their bills, who aren’t over leveraged, who value customer service and just want to be able to buy things when they need without hassle. They are all bad. Bottom line. Amex is my favorite but clearly they need to change their tune. Fast.

  46. James

    My VISA card has been denied, once or twice – When I had maxed it out.Worst it ever got was when my brother was overseas and needed to pay for something in a pinch – I gave him the details and he did it online. I got an SMS message from my bank notifying me of an overseas charge.I’ve never had an AmEx card, but I worked for a payments processing firm for 7 years. Probably 90% of our merchants didn’t accept AmEx – Why? The extortionate merchant fees.Why does anyone still use AmEx? Seems more trouble than its worth, Visa/MC are far better at delivering.

    1. James

      I should clarify that I am not in the US. I imagine AmEx has more traction there, but they are completely irrelevant outside of it, Visa/MC are the only game in town.

  47. dave

    Same BS with Diner’s Club–25 year customer…no apologies…just wait until the economy recovers and we all have choices.

    1. fredwilson

      Maybe we should start those choices nowI’m loving the idea that I get a text from my bank or card issuer when I do a charge and I ok it in real time

      1. scottythebody

        There are even really good ways to provide strong authentication in such transactions if the security issue weirds people out. Some friends of mine in Atlanta have started a company doing just that.Here in Vienna you can buy subway tickets via SMS, so I don’t see why financial transactions and approval of such should be any different. In fact, we already authorize bank transfers via one-time codes sent via SMS.The vision: a borderless bank with full mobile/online integration, an open payment gateway and strong fraud/security services. Paypal could have been that but they dropped the ball somewhere along the way.

        1. fredwilson

          my partner albert told me yesterday that SMS has been compromised by some badly designed nokia phones that are now available on ebay. you can send a message from any number you want

  48. vcinvestor

    In the sixties I spent my first three consulting years with Amex Credit Card developing and installing a credit monitoring and control system. The objectives were to detect high risk dollar balance accounts earlier and execute a program of credit control actions that would realize cash sooner, to “train” accounts to improve their payment practices and to retain accounts that that were worth keeping. At no time did we ever, for a perpetually current account (ie it paid the balance within the ~28 day window), shut down it and related accounts.Either there is some very, very bad experience data out there that Amex CC sees that we don’t or there is a severe case of credit control paranoia within the credit control staff in CC. To me this is a senior management issue. Do they really understand what is going on to minimize losses (which is a pretty bad objective on its own) and what the ultimate long term cost due to the loss of clients like you and that hit on long term performance? You are not the only big charger to realize that a swipe is a swipe. And I suspect that you have also come to see that Amex CC service establishment coverage is not as strong as it might like it to be in its competition with Visa, etc. It is a pain to need a second card with Amex to get comprehensive coverage. You are less likely to need a second card with Visa and its major competitors.CC was a great division to work with. Under the leadership of George Waters It was focused on developing customer sensitive, credit control effective, profit enhancing policies. Now, a bunch of people have either lost the script or have taken a very, very fearful view about our financial future. Perhaps a question to senior anagement or the Board might elicit a response.

  49. markslater

    that’s nothing – i really thought i was alone – this is great therapy.I was in Jakarta 2 weeks ago trying to check in to my hotel – i have been a amex platinum cardholder for about 9 years.So i have just got a off a punishing travel schedule through london, abu dhabi, and have had a nightmare at the JK airport (if you have been there you will know). i get to my hotel – behind huge security – bomb walls, 3 checkpoints going in, (i am staying in a bad area near the factories) – go to check in and Amex does not work. (yes i did call ahead with travel plans). Now when i travel to JK i usually reduce the plastic i carry – (i carry the amex, and a chase visa only) – of course my amex gets declined and we go through this ridiculous effort to call them, have the charge authorized and so on. It turns out that i was late on a payment on a jetblue amex that i dont use, and all the cards are cancelled. This includes my wife’s, my fathers. my father is in greece, and now cant check out of his hotel with his card, my wife is in Cincinnati at dinner and has it declined in front of business associates. I cant speak to the appropriate resource until the following day (12 hour time difference in JK to EST). Of course no one can call up except me.I managed to get this sorted the next day (used my chase card – no issues) – but then i realize there has been an interest rate adjustment, and my loyalty points have been suspended.the rest as you can imagine is a total chaffe. I will never ever use american express for anything again.ofcourse the bigger question is NFC and how quickly this technology can become ubiquitous thus completely disintermediating this outdated form of spending and borrowing.

    1. David Esrati

      It’s not just the global economy kicking our ass- it’s the credit card companies. If you want to place blame, it’s not just the mortgages that went wild over the last 20 years. Credit cards have been getting a free pass.When the feds let them charge 29% that was the beginning of the end. If the Fed stepped in and forced the rates to drop with the prime, ended the penalty rate for over the limit, and just enforced no charging until it’s paid back down- we’d be a lot better off than bailing out the banks and mortgages.I’ve been writing about this for a while- and it was central in my run for Congress: http://esrati.com/?p=518Thanks for starting this discussion. Btw- my biz line of credit with AmEx- canceled, my extended payment option- canceled, my payment amounts- increased.Every month- it’s a struggle, but unfortunately, it’s still the best way to manage purchases.

    2. fredwilson

      This blog is my support group mark. Maybe yours too

  50. David Ulevitch

    First, I am in total agreement. AmEx has been driving me nuts lately. My personal credit line with them is higher than the line we have at OpenDNS, which is ridiculous for all sorts of reasons.Second, I predict this post will have more comments than any other post in your history. I’ve heard similar things about AmEx from my friends and so my guess is the whole world will use this thread to vent about it.Their behavior is truly mind-boggling. OpenDNS just decided to get our first Visa/MC because of all the AmEx issues we’ve been having.

    1. fredwilson

      It will need to get to 300 comments to be the largest ever. But it could happen

  51. Seth Lieberman

    Lots and LOTS of detail about the Amex Credit Crunch on FlyerTalk which I have also found is a great resource to figure out what are good rewards programs and how to use points. A super helpful community.

  52. Marcy Shinder

    Fred,After I read your blog post this morning, I immediately wanted to reach out to let you know how seriously my colleagues and I at American Express take the comments you and others have shared.I have already shared your original post and all the comments with my colleagues here on the small business Cards team.As you correctly noted, “…fraud and increasing default rates makes for a very unpleasant business situation.” Having said that, please know that we are committed to the relationships we have with our Cardmembers.Most important, I want you to know that we are indeed listening and working through the issues you and others have shared on A VC.Marcy ShinderVP, American Express OPEN Brand [email protected]

    1. Gruntled

      Marcy, you and your company are ridiculous, comical and quite frankly are a sinking ship. Good bye. Way to go Fred for hanging up after whoever was on the other end failed to recognize the significance of 26 years. Way too many complaints about AMEX over the past half-year, all the way down from the Blue-line to the small-biz holders.

    2. Anonymous

      Love to see the brand getting involved in the discussion here.

      1. markslater

        its not enough to sugar coat the dog turd you are serving up as customer service and commitment. You cause your customers real and meaningful problems, you fail to answer them or for them, you bate and switch on procedures, gouge on rate hikes and take liberties with transaction authorizations. How can you honestly say that you are ‘committed to the relationships’ – that’s an old economy PR piece of nonsense. here’s what you could start by doing:- open up your fraud and detection programs so that the customer has a reasonable understanding of what he or she can expect, and plan accordingly. Arriving at a hotel and being declined is NOT an answer.- make your credit line policies transparent – its absurd that a member can be limited or changed at will. if you extend credit – then communicate clearly about factors that impact fluctuation, discuss this with your client, and provide proper and reasonable notification – reducing a limit on a small business with no prior notification or policy understanding has ‘material adverse effects’ and is highly damaging.- get of this ‘no limit’ bollox – it was a PR thing way back when. People can go and get 100k on a visa or MasterCard if they like – there is no cache to saying ‘no limit’ and then refusing a restaurant bill. – develop an NFC solution or you will die.- reward loyalty and years of membership properly- stop obscene gouging on late payment issues. what you are basically saying is – pay late once and you are no longer a customer – if that’s your policy then state it – watch people run and not walk.I personally can’t wait for technology to come along and squash you. As i know not one thing mentioned here by any of us will filter its way through that behemoth old economy customer care Juggernaut of yours, i thank you kindly for a torrid time in Jakarta and for my families inconvenience and wish you godspeed on your long walk of a short pier.long local banks and NFC

      2. fredwilson

        Me too

    3. fredwilson

      Marcy – It was great to talk to you this morning and even better to see this comment. As I said in our call, I’d love to see America Express “turn lemons into lemonade” This economic downturn has exposed a lot of weaknesses in the credit card business model and your company’s customer service model (as well as your competitor’s customer service model). There is an opportunity to rethink the products and services you offer to small businesses and offer real value. I love what Jet Blue did for flying (and more recently Virgin). They got rid of the stuff we don’t care about and focused on the stuff we do care about. I don’t use most of American Express’ services anyway. But things like being able to get a text on my phone when a questionable charge is being made (and being able to approve it with a reply) would be awesome innovations. If American Express doesn’t offer them, we’ll probably fund a company that does.

    4. Jessica Hutfless

      That isn’t true. American Express does not care a wit about it’s customers–at least not about retaining the customers they have already. There was nothing in my credit report that caused alarm for my other creditors–but American Express must be in trouble, as they are slashing customers left and right. I used my AmEx card as my primary card, so needless to say, it was a huge problem when AmEX cancelled my account unexpectedly and WITH NO PRIOR WARNING. How does that spell commitment to the relationship you have with your cardmembers?

  53. lloyd francis

    I usually never comment, but your experience is a sober warning not to get too deeply involved with credit and leverage….

  54. Rory Bernard

    Interesting thread – In europe Amex is not very widely accepted outside the travel industry. The reason is they take over 4 weeks on average to hand the money over to merchant compared to 1-2 days by Visa or Mastercard. When I try and use my Amex even at those stores that take it they almost always try and persuade to use another card and many will put 10% on the bill if you insist on using Amex.Added to that their security is incredibly lax – all my other cards have chip and pin requiring me to verify the transaction at the machine. I can buy a $500 airline ticket out of a machine with just a swipe – nothing else required.Having said all that I have an Amex card as it gives me airmiles where it is taken and I have never had a problem at all with their customer services in 10 years. However I think they need to sort out how they treat their merchants – what good is a card that no-one takes?

  55. MoveableBeast

    Why put up with the hassle? Ditch Amex for Pete’s sake! Amex has a reputation for turning on its customers – this happened to me as well – a reliable customer but my payment was received 5 days late once they cut off my cards just before I was taking a six month multicountry trip! Highly inconvenient. I have since racked up a lot of charges with MasterCard, Visa, UC (a Japanese CC brand) and increasingly my HSBC VISA-protected debit cards. A lot fewer problems (and hassles with them vs. Amex). And of course Amex has been trying to get me back as a customer for the last 10 years because they see how much charge volume I generate for business trips, last-minute airplane tix, etc. Sorry Amex, it’ll never happen because you treated me like dirt the last time! Treat your customers right from the get-go and they will stay loyal. Treat them badly and they will mark you for life.

  56. jamiequint

    I had a terrible experience just signing up for an account. We got a business gold card which was approved quickly, and we set up a bunch of recurring charges on it. After 6 weeks AmEx decided to freeze the account for no apparent explanation. They told me they needed more data to confirm I was creditworthy. I explained to them that I had already been approved for the card, but got the same response parroted back to me from multiple support agents. “From time to time we review accounts and have to request more information, blah blah blah.” Not only is this ridiculous because I had *already* been approved, but also because I had faithfully made a payment to effectively prove it.After this they tried asking me for all kinds of personal information to prove my income (3 years of tax returns), etc. I flatly refused told them I would be happy to send our business bank statement (recently venture funded) and had to go through 3 levels of customer service before I they finally accepted that. Next time I think I’m skipping the hassle and going with someone else.

  57. NYCStartupfiend

    We’ve had identically horrible experiences with AmEx despite my having given them, through the companies i’ve founded and ran, more than 500 corporate card holders over the past 6 years. We use them only because we have to, not because we want to. In the fall of last year, we had 10 employees using the cards in the field when AmEx abruptly shut us off for paying our bill AHEAD OF TIME and then made us jump through a weeks worth of paperwork hoops to prove to them that we, as individuals, were who said we were. We ultimately called the CEOs office to see if someone there would help (we just called Amex HQ and asked to speak with the CEO) and were put in touch with a group that seemed to be quite experienced in massaging the Amex nightmare for customers. They were very nice and kind but ultimately not speedy but at least they were nice and pleasant – the other groups we had dealt with were surly beyond what you could easily imagine.

  58. Steve Kane

    This is a bit one sided and misleading, so felt compelled to say something. I’ve been an Amex card holder for 20 years, last 10 as a Platinum member. I have never missed a payment and have never had any problems with Amex. Seven years ago I started a new business and used the card to help fund and manage my cash flow very successfully. They have not reduced my line and never called me to pay my balance early. I’m sure some of the people here gripping have other issues and problems affecting their finances and are irresponsibly blaming Amex. These are difficult times for everyone, but I guess easier for some people to just point the finger at a big company instead of taking responsibility for themselves.

    1. markslater

      yeah ok.

    2. fredwilson

      yes, that’s true stevebut in may case and many other cases, amex just screwed up and hurt their best customers and themselves

  59. Halley Suitt

    Good God Almighty! This is some BLOG POST and some ocean of AMAZING COMMENTS! It better be part of the next Harvard Business School case study on Amex and the credit card industry in general!It tells me three things:1. Credit card business cratering, so move over Swine Flu headlines — this will be the next massive story — it’s priceless!2. Creative destruction of this industry (w/some nudging from Washington) will open brand new ways of doing business (finally);3. The folks who “get” that plastic card business is ONLY about customer service, will be new stars of this entrepreneurial goldmine.Thanks Fred for making a place to gather everyone’s stunning revelations on this very hot online topic.Best — Halley

  60. New West Living

    “After I read your blog post this morning, I immediately wanted to reach out to let you know how seriously my colleagues and I at American Express take the comments you and others have shared. “We’re still on hold lady! are you going to address concerns posted here? or you just popped up to rehearse your robotic corporate message?Me? I DTMA’ed (borrowing Dan Savage’s term) American Express – two years ago.

  61. COP

    This is so timely.Last week I was in Colorado skiing and they said my AMEX declined. I was shocked. then i got to a computer to learn that AMEX had reduced my credit limit to more than half.. I felt like being CHEATED for all the loyalty all these years.Seriously somethings up with AMEX.. i’m thinking of transferring everything to Chase.

  62. Luiss

    American Express has morphed into just a regular bank card with total disregard for customer loyalty and length of membership. In the past 10 year, the company has lost its original charter of being the best in class and performing really unbelievable services for its cardholders. That time is gone!It is totally unbelievable that under this current management they could not figure out that by being a real business partner to cardholders that have been with them for years is the way to go instead of the current harassment campaign and herd mentality of treating customers.10 years ago it was a badge of pride to carry the American Express card, today it is just another plastic card in your wallet that reminds you that “membership” does not have any privileges.

  63. Jon Michael Miles

    Canary in the Coal Mine?My wife and I have five accounts and while we have not experienced a denial personally, I have noticed another canary in the coal mine.American Express was one of the most egregious senders of paper junk mail. We rec’d literally hundreds of offers and for years we periodically would call and ask to be taken off their mailing list, but their policy was “all or nothing.”I hadn’t noticed until I read your post, but now that I think about it, we have had a precipitous drop in our junk from Amex.Maybe Amex is going green, but I kinda doubt it.

  64. Sandy Sabean

    Wow! This is some thread!! I first saw this post 6am with no comments and wasn’t awake enough to properly voice my own huge dissatisfaction with AmEx (and I also had to get the kids out of the house).It is incredulous what is going on with AmEx. They are not the company I thought they were. I’ve used them for personal use for over 20 years and my own businesses for the past 5. I’ve also gotten my limits reduced and have been asked too many questions. It’s like they never knew me. I can’t tell you how many people I know who have their own negative AmEx experiences.I agree, a swipe is a swipe is a swipe. There are only a limited amount of spaces in my wallet for credit cards and once you’re gone, you’re gone for good.

    1. fredwilson

      hi sandy – nice to hear from you. i am not sure if you heard, but amex did weigh in on this comment thread. apparently if was the first time ever.

  65. Garbanzo

    Whenever I travel overseas, I call my credit card companies like a good boy and alert them to when and where I’m traveling.Last year, I stupidly crossed the border between Hong Kong and mainland China within any pocket money, so I went to an HSBC ATM in Shenzhen. Tried my debit card, which had worked fine in HK the day prior, and no go. Tried another VISA-branded card from a different bank, and it looks like once VISA shut me down for one card, it hit all of them. Luckily, I had a Mastercard and was able to get cash to continue on my journey.When I got back to the US and told my bank (Commerce Bank) that I could have been stranded there despite my diligently letting them know I was going to be in China during that date range, they were exceptionally unsympathetic. Now I never travel without several different branded credit cards from a couple banks. They can’t shut me all down at once, can they?

  66. Rob Deeming

    I think this discussion warrants some balance and perspective.Managing the accounts of several hundred thousand card holders, at the individual, small business and corporate level is a significant challenge for any company.As small business owners, we naturally come to expect a bespoke hand-held service from our vendors, conditioned by the constant support offered by 3rd party legal or accounting support for example. But across the network that AmEx is attempting to manage, a bespoke level of service, particularly for smaller businesses, is just unfeasible. So, they set up programs and incentives to try and offer the best possible service to those types of customers. Unfortunately, it is never going to be perfect for everyone, but in general I would argue that most customers find that their product serves its purpose well. The posts above are certainly not a fair representation.I applaud AmEx for engaging in the conversation. Having worked with a few large companies as a consultant, I understand the challenge they feel in trying to hear and digest the views of their customers (and non-customers) – I am sure that this conversation will be invaluable for AmEx as they continue to evolve their small business offering.

    1. Pete

      You sure you don’t work for AmEx? who’re you kidding here?

      1. fredwilson

        rob doesn’t work for amex. he’s just playing the devil’s advocate. an important role in any discussion.

    2. Scott Yates

      I agree that they have a hard job. The point is that AmEx has been much worse than all the others.It’s like I said before, you know who your worthwhile partners are when times are bad, and Amex has shown itself to be a crappy partner. That’s why I will never use Amex again.

    3. markslater

      ok – the programs and incentives are de-coupled from the ‘best possible service’ – this is the core of the issue.Over here (look at left hand) i have attractive programs and incentives (loyatly points, unlimited spending, fraud protection – anything else?) – and over here (look at right hand) i have ‘best possible service’. (concierge for plat user) – the problem is – they have lost the hinge that connects the two.its nothing to do with bespoke – they are way beyond the ‘learning and discovering’ phase of this product – we are customers not evangelists.If they are still in the discovery phase then they should stop selling and start listening – but they are not – and we are paying a price for the uncoupling of a cohesive product and customer delivery strategy.they would do good to go and study this type of thing:http://www.slideshare.net/v…but you and i both know they wont.to steve kane’s point, i did pay late – i certainly learned my lesson. I fail to understand how they could rationalize that punishement for the crime – that is the issue that has my ticklers in a bunch.

  67. Dave Allen

    As a small business owner I too have suffered at the hands of American Express. After being a customer for almost 20 years I was stunned at how harshly they cracked down on my business Gold Card activity as well as my business Blue account. The worst transgression for me was when they denied me ticket purchases for flights and hotels to a conference in Hawaii recently. Clearly small businesses and entrepreneurs like myself are trying to keep the economy afloat – American Express is not helping.It is refreshing to see Amex VP Marcy Shinder taking the helm on this one. I will be intrigued to see how things turn out.

  68. Jennifer Ripley

    I have had my Costco AMEX card for 8 years, NEVER been late on a payment, and my credit limit was 23K. A few months ago, I got a letter saying that they were lowering my credit limit to 9K….I was surprised and a bit annoyed, but ok, they are being paranoid about the economy and credit risk, so whatever, I never have that much on that card anyway.A couple of months ago, I decided to pay off the balance on that card with another card for 0% finance charge, and ended up with a slight credit on that card. Last month after paying off that card, my TV was on the fritz, and Costco was having this MEGA deal on a plasma my husband and I wanted, so I charged it on that card to get the Costco points. Suddenly I get this email saying that they lowered my credit limit to 1 THOUSAND dollars, and denied my charge for the TV, even though I not only had a ZERO balance, but a 200 dollar credit. I have NEVER been late on a payment, and I NEVER pay the minimum balance, always at least double the minimum. I called Amex to find out what happened, I tell them “I have a 200 dollar CREDIT and you are denying my charge for this TV for less than 2K?” I even explained that once I had my tax return, I would pay it off the SECOND I got the check, and STILL they said no, the order was cancelled, and my limit was now 1K (when it was 23K not 3 MONTHS ago). The bitchy customer service rep said that they get a monthly statement from Experian that showed negative things on my report. I immediately ordered that report and saw NOTHING negative on there, even in the last year!? I (of course) immediately cancelled that card after being a customer for 8 years, and I have a completely new view of American Express. They are obviously treating their best customers badly with no reason other than the paranoia of our current overall economic state. Now they have forever lost yet another good customer.

  69. jim louderback

    FWIW, I’ve been a green card customer for years, and never thought about upgrading. They’ve been fine for me, I haven’t had a lot of problems.They did just come through majorly when I got in an accident with a rental car, covered the cost of the repairs… HOWEVER, if you want to rely on their insurance for rental cars, make sure you pay your bill in FULL and you are up to date. I was almost out of the grace period, and if so the insurance would not have covered me.But it did. Thanks Amex. The process was also pretty darn easy too.Not my favorite company – but waaaay better than some.jim

  70. John Oakes

    Same story for me. I am a partner in various business with many different accounts and as a result of AMEX change in service, policy, and customer service I am now not renewing my Black Card with them and moving all of my other business accounts to Visa/MC.

    1. Steve Carr

      John, You have a Black Card the same way i’m married to Giselle!

  71. Bruce Colwin

    I feel much better after reading your post, since I’ve been having quite a few problems with Amex lately as well and couldn’t imagine it was anything to do with my credit or payment history with Amex.It started about 6 months back when, regardless of the fact that I have not had one late payment, they lowered the credit limit on my business platinum credit card. I learned that they’ve been doing reviews, though not sure what the trigger is, and reducing credit limits in 75% of those cases.But lately, I’ve been problems more similar to yours. Over the past few months, I’ve been getting emails that my personal gold card is suspended because of my credit balance – though it’s been less than half what I’ve typically spent over the previous months. When I called them about the recent gold card suspension, they pointed out the outstanding balance on the business credit card. Umm, isn’t that the POINT of using the credit card and not the charge card — the ability to maintain a balance? They also do collect finance charges!The representative asked if I’d be making payment. Not WHEN I’d be making payment, but IF i’d be making payment – even though it was not yet due. I told them I’d pay it prior to the due date, as I always do. And they repeated what I promised then released the suspension on my gold card.They never said it was potential fraudulent usage or a late payment, as may have been the case in your example. It was just some mystery algorithm that caused them to alienate a long time customer. ( I’ve been a “Member” since 1991.)Apparently, they’d rather focus their efforts on customer acqusition than retention.

  72. Bill

    All the card companies are doing the same thing; they have no real idea of what customers will pay and who will default so they assume everyone will default.

    1. Sally

      I have citi, amex, chase, diners and discover. I think of it like exercising. When I worked in a retail bank, overdrafts/credit lines were monitored annually. Therefore one a year, each card needs to be used up to close to the limit and paid off in a timely way to keep the size of the line current. The credit reporting companies monitor this so using the card up to 66% of the limit might be more appropriate if you’re currently house or car shopping.I don’t keep a balance on the cards.I avoid late fees by establishing an electronic payment from my bank account to the card about a week before the due date for an amount that will cover my minimum payment. I then have the credit card company draw the “pay in full” amount from my checking. This way if the payment gets messed up, I have already covered the minimum. If you pay the minimum early enough, the pay in full amount is reduced accordingly so you’re not paying too much early.I think debit cards are the biggest con in the banking business and see no need for one. You are simply completely unprotected. Many places enable cards to be swiped without a pin being entered. There’s no fraud protection and the bank makes a turn on the money it takes out of your account, not to mention the excessive fees if there are overdrafts. I recommend having the mastercard/visa feature removed from your ATM card which will mean trying to reach your bank on the phone (nightmare) to have them disable the feature.

  73. Steve Kane

    I’ve never read more whinny BS crap in my life. If this is representative of other business owners, may heaven help us all. The reason Master Card, Visa and Amex are reducing your credit amounts, probably has to do with the fact you never should have had such high amounts! Knock knock…They know you can’t pay it off! This is the reason our country and the whole economy is in such trouble. People borrowed or charged more than they could fiscally handle or afford. If you make $50k a year, you shouldn’t have a $25k credit limit. The same way if you made $18k, you shouldn’t have bought a $1 million house, and then complained that the big bad bank was foreclosing when you missed the last 8 payments. The days of free money are over…now try something novel…like working for a living and living within your means!

    1. fredwilson

      did you wake up cranky or what steve?where there is smoke, there’s firei don’t have a credit line with amex. i pay off every bill at the end of the month.and they’ve been messing with me and the gotham gal and my partners and their cards for no good reasonsure, some people use this thread to jump on the bandwagonbut there’s a real issue here and if you don’t see it, you aren’t looking

      1. Scott Yates

        Interesting that this Steve guy is the only one in the thread who missed the point. I thought there would be more.All the others are people who do not fit any kind of profile of people making too little money buying too much house and then buying too much stuff on their cards. These are all the good customers, the ones that AmEx should want to keep in times like these, and instead they are making us mad and want to go away.I also hope this leads to some new solutions, but the easiest one for me is to tell AmEx to jump in a lake, even if they did have someone show up here to try put perfume on the smelly problems.

    2. markslater

      i use it as a service – not as a bank. when that service fails and i have come to somewhat rely on it when i travel, then that is painful. my situation has nothing whatsoever to do with your rant.

  74. scott

    Wow. I have not had any problems but this is making me rethink continuing my 20 year history with AmEx. And Marcy’s stock PR reply does not help at all. It’s just an admission that they are indeed f&^ing over their customers.

  75. gregshove

    my comment will seem so unoriginal now – same treatment from Amex 2 months ago, while trying to check into hotel for TED conference. Lots of cards, for many many years, for business and personal including a black card. none of it mattered, and sadly, the customer service rep clearly had no decision-making authority. Feels like a ‘no wiggle room’ clamp down to survive the recession – but you would think the algorithms would do a better job of managing the 10 year plus customers. a late payment (as was my case on one of the business cards – the one we use for adwords campaigns) should not activate the nuclear treatment. seems like an opportunity for a new credit brand – that combines a new slate of member benefits with real-time human service.

  76. Jason

    I had a huge problem with American Express last year.They talked me into getting a Plum card then when I let a payment go late a snotty shit faced 30 something manager wanted close my accounts-I have been with Amex since 1984 and never missed a payment and have spent hundreds of Thousands of dollars.believe me I’m thinking twice about them now.I called the office of the president and got a much different response,They were cordial and did eberything they could to help me.You just have got to be agressive with them as they are with you

  77. Denis

    Fred,Your comment evidences a fundamental weakness in the credit card system, with credit being given to just about anyone at any point (over the past couple of years), companies making billions over it, and now those credit card companies are scrambling to save face by Draconian precautionary measures.I think it’s a price we all pay, but not after 26 years of prompt payments. No excuses on their part. Fix the damn algorithm and implement it better.As a merchant, I have no desire for Amex given it’s significantly higher commissions and as a consumer, I have no need for their product because my Visa works just as well 98% of the time. The other times, I’ll use cash.

  78. Ray Ray Angel

    Reassuring to read I’m not the only one with these sort of weird issues with Amex when it comes to fraud prevention. Frankly it is embarrassing going to a major electronics retailer and pulling out my business Amex card and having it denied in front of a lot of people. I’m really starting to rethink why I am still using Amex for Business.

  79. Matt Harris

    much of amex’s current angst, and resultant bad behavior, is a function of a payments company becoming a credit company, and failing to appreciate the difference. 15 years ago, amex was a better way to pay for goods and services, with recognizable differentiation (insurance on car rentals, customer service w/r/t repudiation, etc). 2 years ago, it was largely a small business lending company and small business loan securitization engine. whoops. now it is firing good payments customers because it’s afraid they will be bad credit customers.my own view is that HNW and strong cash flow small businesses are better served by a prepaid model in any event, with lower merchant fees and close to zero security risk.knock-on question: given this thread, why is $AXP up 200% in last 2 months? sell, sell, sell.

    1. fredwilson

      Excellent point matt. I think you’ve nailed it

  80. Aaron deMello

    Brad – just a quick data point to mention that this is happening in Canada as well. I’m 35 but I’ve been am Amex customer since I was 18. All my startups have been born via Amex credit in one way or another and I always pay off my bill. About a year ago they started acting very bizarre, despite the fact that I am a great customer and have spent many, many zeroes on my Amex over the years. Now, almost every large charge has to be hand-verified and some retailers are refusing to do it! So this is an example of how a hawkish policy can come back to bite you in the ass.

  81. Erik Giles

    Since you seem to have their attention I recommend a different tactic. I recommend that we send letters to ellen degeneres, martin, martin scorsese, wes anderson telling them directly that their support of American Express quite frankly sullies our perceptions of them (which given AmEx’s recent behavior is true). Maybe if their cavalcade of celebrities starts dropping them, they’ll get the hint.I mean chances are they have access to the LA Times right?

  82. Roy Fuchs

    The problem is larger than a complaint with American Express. It is that when you call a company you get a first level agent, a person empowered to follow a simple set of business rules, and to say “NO.” You have to get one or two levels higher, someone with whom you can negotiate and who can say “YES.”We’ve all had the same problem with a lousy hotel room and probably a dozen similar attempts to give our money to a variety of merchants.

  83. Kristian Andersen

    I can remember growing up, my father instilling in me an almost religious reverence for Amex. As soon as I graduated from college, I bought a car, a home, a real suit – but I didn’t really feel like a grown-up until I got my first green card. They were a truly differentiated brand.They are no longer a truly differentiated brand. I’ve been deeply disappointed by the treatment, low-level harassment, and level of service that I’ve received over the past few months. I don’t have to hit the net to find people to commiserate with, I had this conversation last night with a friend, who initiated the conversation by griping, about how he had been treated by AMEX recently.Big Ups to Marcy for figuring out how to effectively engage her customers via social media. But its going to take a fundamental reversal in their current modus operandi to fix this.

    1. Tomtom

      In this age of billpay and multiple other technologies to make payments how are individuals/businesses not making their payments on time? The minute i get a credit card bill or periodically check my accounts online I make arrangements to make a payment that will be on time and at least cover the minimum.I think the more telling thing that one should take from this thread is not the issue of AMEX frustration but rather all lenders are being restrictive with credit. Smart businesses and individuals need to adjust to this new credit environment and find alternative measures that will allow them to function properly.

  84. toxic brit

    That’s great that Amex came back to you so quickly. I have been offered a credit extension by them, I applied for it then they turned me down. Things at that place are screwy right now. Im surprised the US Treasury says they are a-okay, but then again when you charge 30% interest on your credit cards and 4% transaction fees, you really should be!

    1. Living in the real world

      you must be in defaut, cause you only get charged that much interest if you don’t pay your bills on time more than three times in 12 months, and 4% transaction fees? you must be drawing cash off your card cause other than that there are not trans. fees, besides its 3& by they way. Quit complaining and pay your bills on time and bad things may not happen.

  85. Living in the real world

    I love how everyone loves to gripe and complain about how american express screws them and blah blah blah. Has anyone stopped to think that you are not spending your own Money?? If someone calls in to American Express and says hey this charge is fraudlant, what happens? Amex foots the bill. Just imagine how much loss the company occurs with people saying that on the charges that were not stopped. And get over your card not “working” or being declined at an establishment. You can get off your high horse and call in if need be. Seriously AMEX has millions of customers and they do a damn good job of serving everyone as personably as possible. There is a reason why they are leaders of the industry because they take precautions to take care of THEIR MONEY!!! Remember you charge the card first, American Express foots the bill, and relies on you to pay your bill which does not always happen. If you do have five accounts and you “forget” to pay your bill what do you expect to happen? You just expect a company to keep allowing you to spend their money? Get real, your not entitled to anyone’s money regardless of your credit score, those scores can change anytime and a lot of times unfortnately for the banks bills go unpaid and money is lost before they even realize your a risk. Kudos to American Express for guarding their money, but still having someone available to speak to around the clock everyday. You want a clear policy and procedures of how your card works? Why don’t you check out the card member agreement (contract) that you signed your name to, it spells it all out for you, if your not to busy crying about someone else’s money your spending, to read it. Oh yeah and for all of those people who have complaints about how much a “pain” AMEX is why don’t you start up your own credit card company and lend money to people you don’t really know anything about except for their fica or credit scores, and then we will see how much of a pain you would be as soon as you don’t get your money back. You people are crazy to have such bad attitudes towards a company that is willing to loan you money to give you a chance to run a business a turn a profit. How about a little more gratitude and understanding on how hard it would be to manage millions of accounts while also providing tons of benefits and insurances that no other credit card company even bothers to offer their customers. I have American Express and yes things go wrong, but as long as your not to dumb to look outside of your little world and realize how things really work, and that this is a real company ran by real people (that yes may make mistakes, don’t you?) but I am very thankful that they are willing to loan me money with no interest charged as longs as pay what I owe at the end of the month, hell not even my local bank will do that. If you cant do it your self, shut up and play the game, if you know the rules you won’t get hurt. You might even benefit a little. It’s disgusting how spoiled some people are.

  86. Nigel Walsh

    wow – there is a lot of anger and emotion here, from both sides of the fence. I have been an Amex user in the UK for many years, not quite 26 Fred – but close on double digit years. In that time I have seen my profile rise and fall. I was impressed by their service and statue – having an Amex card used to mean something. Today in a world of access to info and commodity, there proposition has to be very different.I have paid anything from $600 currently to $2000 pa for the card I hold and some of the benefits were great, but over time I realised that with other free concierge, ticket and insurance services that actually the best deal for me was a card that rewarded me with the one thing that we all work hard for – hard cash. To that end, I have moved from charge to Credit cards and only ones that pay cash back. In the same experience as Fred, My wife got denied in NY a spend on her card – only to be told we had never registered it. I kindly asked the advisor to check our previous months bills, all of them to see that she has been using it fine for so long….Its just not joined up anymore – there previous USP of Membership Rewards and Customer Service have gone. I’m not sure what value there is at all in MR, and their customer service has varying success depending on many factors. The problem here is no longer unique and most certainly repeatable.The other thing that has changed is ‘pace of change’. I talk a lot about Pace of change to my customers. As consumers our expectations change rapidly – as organisations we are unable to match this pace and over time we will grow apart unless something can be done.Amex will lose old customers, but also gain new ones as they find new markets and ways to service them. It’s good for us as consumers to change to and experience the grass on the other side.A swipe is just a swipe until something goes wrong or its someonelse swiping with your details!

  87. Albert T. Kelley

    I thought it was just me, but I guess there is some comfort in knowing that American Express is seemingly working very hard to drive away all of its best customers. I have had a personal Platinum American Express card since 1976. Never was a payment late and the balances were considerable since the card was used for extensive international travel for many years. Today, June 25 my personal American Express card was frozen, without warning. I called American Express and was told that a payment on my employer’s American Express card was due yesterday, June 24 and has not been received yet.When asked about my perfect payment history and card membership for 33 years, as mentioned above, I was also told it does not matter. My employer was late one day with a payment therefore my personal American Express card is frozen. Then the American Express representative added insult to injury and went on to ask me if I wanted to pay my personal card right now. Perplexed, I queried “what are you talking about, the card is already paid”. Then he proceeds to tell me is not talking about my current bill but is asking about the bill for next month that is not due until the end of July.Like the writer above and apparently many thousands more, I have had a long-standing relationship with American Express that was always outstanding until recently. They now come across as desperate, eager “loan sharks” and not the prestige company they used to be. Incidentally, the annual fee for all this “service” for a Platinum American Express is $350.

  88. Jessica Hutfless

    Wow, that is quite a story. AmEX unexpectedly closed my account, without any prior notice, despite the fact that I had been a loyal customer with no delinquencies. Even though I had been on the phone with them the day they closed the account, and paid my balance during that call in full, they didnt even mention that they were reviewing my account( and thinking of closing it)! I have been an AmEx customer for several years ( was enjoying their JetBlue flyer miles benefits) but I will think twice before I open an account with them again. I am a Visa customer for sure.

  89. currij

    I had the same problems. 755 credit score charged 200k with amex the past year and without notice they dropped my credit line from 25k to 15k. Now every other charge they deny it and the merchant has to call in and I look like someone who doesn’t have any credit left. It’s absolutely ridiculous. Had the card since 92 and haven’t had one item of fraud. Now every other charge amex calls me to make sure it is me making a $99 charge. Last month I charged 11k and I always pay it in full each month. I have moved all my employees to visa. Hate to change since I have all these automated charges every month, but I’m canceling the rest of my cards. My advice to AMEX…… get back to basics and appreciate your long time customers. Quit relying on algorithms to advice you which customer line to cut

  90. markslater

    good point – they are one step away from another industry that ended up suuing its customers – the music industry.

  91. fredwilson

    Exactly charles. Its not so much any one of these incidents. Its the aggregate of them and the absolute lack of interest or care by senior management in them