The American Express Card – Leave It!

The Ancient and Honorable AMEX Scams Us Again: Peter’s ALTERNATE WORLD ENCOUNTER: Have you ever charged some­thing on your credit card and for­gotten about it?
Many people have.

Typically what hap­pens is the bill from the American Express credit card com­pany arrives in the mail, and you see a charge from a couple of weeks ago that you just don’t remember.
So, you pick up the phone, call AMEX and say I don’t remember this charge, or I don’t believe I owe this, or some­thing like that.
And the cus­tomer ser­vice per­sonage says to you, no problem Sir or Madam, we’ll just put that on hold, have a nice day!
And you have a nice day.

Meanwhile, the mer­chant who accepted your credit card (that would be me) begins an Alternate World Encounter (the Alternate World is NOT nice): our bank account (that is, Yukiko’s Floral Design Studio’s) is blocked and the credit card com­pany impounds the money and leaves me to prove why we should get it back.

So, the mer­chant (me, again) calls you and reac­quaints you with the transaction.

You, of course, are a rea­son­able person, ter­ribly embar­rassed by this unin­ten­tional, awk­ward mis­take, and yes, of course, you will call the credit card com­pany to straighten it all out, and you do.

And the American Express Card’s cus­tomer ser­vice per­sonage is very kind and under­standing and assures you it will all be straight­ened out imme­di­ately, not to worry, and have another nice day.
And you do.

But the credit card com­pany is American Express: behold, the Alternate World Encounter descends to a lower level.
The mer­chant (meaning me, of course) knows you have been told the “hold” is being released imme­di­ately, so I ask our bank to unblock our account, get the money back from AMEX and we’ll all let bygones be dog bones, or whatever.

But no, that’s NOT going to happen.

AMEX tells our bank, NO. They say they’re going to fight it to the limit of 75 more days.
(And by the way, AMEX holds the money while they think of what to say after those 75 more days).

The first time this hap­pened to me, I said to myself, surely this is a mis­take — a com­pany like American Express would not LIE about a hun­dred dollar charge just to keep their hands on our hun­dred dol­lars for about three months.
An old and respected American insti­tu­tion like AMEX wouldn’t do that. Would they?
Well, they wouldn’t do it just for our hun­dred bucks.
But this second time around I real­ized the AMEX context:

• AMEX has mil­lions and mil­lions of credit card accounts, some have disputes/​nondisputes like this one.
• The money AMEX holds from these “holds” adds up to a huge amount of cash in their vault —
• So much money that even a ven­er­able insti­tu­tion like the American Express Company is eth­i­cally chal­lenged to deal with it.

American Express Company’s eth­ical dilemma is this:

• “Shall AMEX give back the cash to all those mer­chants now, or later?”
• Guess what: “later” wins.

And that means that AMEX’s deci­sion to keep the cash gives them­selves a huge float of other peo­ples’ money (including our minis­cule hun­dred bucks) for sev­eral months. Some would call AMEX’s dilemma a “moral hazard,” while others might simply call it a scam.

But wait! The Alternate World Encounter descends a fur­ther level: is the ven­er­able American Express Company on the list of big time recip­i­ents of US Government bailout money?
Yes, it is.
And does a sub­stan­tial por­tion of the US Government bailout money come from mer­chant tax­payers?
Yes, it does.
American Express Company, have you no shame?
I mean, really.

And one more thing: when Yukiko’s Floral Design Studio asks clients if they would like to use Visa or MasterCard – there’s a reason. And, yes, this is it.

Peter Neibert