chalf

By the definition of a class action suit, if you meet the definition of the qualifying class you are automatically in, unless you choose to opt out. The down side is that by being a member of the class, you lose any rights to pursue independent litigation (i.e. you must accept the ruling for/against the class on your behalf).

JohnAx

How does Amex state that they will determine the exchange rate? Unless they state in their contract that they will use "x" and then don't, and the extent by which you disagree with their rate is only four percent or so, it's hard to imagine you have anything to complain about.

Many of the forex players think nothing of offering foreign-denominated paper or transfers at 8-10% above the neutral rate to American retail customers, and clearly aren't doing anything illegal. Instead of fussing about it (beyond telling everyone about it, which I loudly applaud) simply use one of the Visa or M/C cards issued by an institution that doesn't surcharge the built-in 1%.

If you're sensitive to the issues, you wouldn't be using AmEx in any case, since even their stated 2% is already twice the M/C and Visa rate.

Ex Amex Card

I don't have the exact wording from the contract to hand but to the best of my recollection, it was worded to the effect that they would convert the transaction at the "prevailing rate".

This was taken to mean the wholesale or Interbank rate, not just by me but also in reviews by major newspapers (including The Sunday Times) and financial institutions who identified the card as a good one to use abroard since it didn't charge any loading on foreign transactions.

Futhermore, other UK credit/charge card issuers make it clear in their terms and conditions that there is a "loading" of the wholesale exchange rate by 2.75% in their favour. American Express (UK) made no such statement in their T&Cs.

As for 4% being nothing to complain about - what planet are you from? What if you charged something to your card and Amex just added 4% because they felt like it? Why the hell should we pay a completely arbitary surcharge when the card issuer tells us there isn't one?

As for some foreign exchange money changers charging 10% commision, I am well aware of this - that is why I use a credit card instead! The thing is, the rip-off money changers will TELL YOU what exchange rate they are giving you whereas American Express just MAKE ONE UP that suits them and hope people don't notice.

BTW, any UK people out there if you charge a lot of foreign currency transactions then check out Nationwide VISA - No Annual Fee, No Foreign Transaction Loading, you get the Interbank Rate.

http://www.nationwide.co.uk/creditca...ard_abroad.htm

chalf

I recently received updated Ts&Cs for my UK Amex that stated that, to paraphrase, foreign currency charges would be converted from the currency of charge into USD at the prevailing rate +2.73%, and then from USD into GBP at the prevailing rate (no additional commission). This has also been stated at the bottom of the page when i check my balance on-line. This differs from the US practice.

Ex Amex Card

Yes, I got the same thing on my new Amex card and statement.

If they are writing to us to say that they are adding a 2.73% charge and making it such a prominent notice then surely this confirms that there was no mention of such a charge in the past.

Find your old T&Cs and see what they say about exchange rates. Then check historic exchange rates from Oanda.com - you may be in for a nasty shock...

Raffles

The question is (not having my T&C to hand) what is the 'prevailing rate'? If this is a buy-sell spread (ie say 1.78 - 1.88 for wholesale $) then Amex is making a killing by transferring your balance from, say, Euros to $ (at 1.88) and then $ to Pounds (at 1.78).

If the 'prevailing rate' is the mid-point (ie 1.83 in my example above) then there is, of course, no additional rake-off for Amex.

QuietLion

By my calculation the markup on that transaction was 1%. Last time I checked, US/Canadian exchanges were marked up only 1% by AmEx although this is not stated in the T&C that I can find.

QL

glbremner

Recently returned from a short trip to NY only to find I had failed to properly read the change in T&C's from amex and fell foul of this 2.7% charge although I was unconvinced about the rates they were using.

To make matters worse on a refund I lost �8 as listed below, why do Amex charge the 2.7% abroad?

Charge
28/03/04
�511.63 - 908.96 UNITED STATES DOLLAR

Refunded
01/04/04
�503.64 - 908.96 UNITED STATES DOLLAR

I'm now going to use my normal bank card for transactions abroad as this has no charge!

Raffles

As far as I understand it, EVERY CREDIT AND DEBIT CARD in the UK, except for the Nationwide card flagged above, has a 2.75% foreign currency weighting. Amex is no better or worse than the rest, assuming - of course - that they all convert at the same wholesale rate.

Even with the 2.75%, however, this is not a bad deal. Your refund went through at $1.80 to the �. The sell rate at Travelex when I was at Heathrow last week was $1.73. You are still better off paying with your card than using travellers cheques or cash unless you find a money changer with an excellent rate.

HKG_Flyer1

The issue at hand is that Amex, prior to the recent change to the U.S. T&Cs, was contractually representing that they were using the interbank rate, when, in fact, they were apparently padding the rate in an undisclosed manner. I am familiar with forex players charging 8-10% for American retail customers, but they disclose the fact.

Not only did Amex apparently not disclose what they've been doing, they appear to have falsely represented to the media the manner in which they calculate charges (assuming the articles in the Wall Street Journal and several travel magazines contained accurate representations of their conversations with Amex representatives).

The fact that you think 4% is no big deal is apparently what Amex was counting on... kind of like the bar owner who turns a blind eye toward the bartender pocketing a few extra bucks for drinks that haven't been rung up.

Think about the financial impact on Amex. If they have systematically been padding a substantial percentage of int'l card transactions, they have profited significantly off of cardholder ignorance.

chalf

I did check my old Ts&Cs to see if this was a real change, and as best I can tell the new termns are not inconsistent with the old. They previously provided only a general statement that the amounts would be converted by Amex at rates they determined, or something similar. The new specification could actually be more customer friendly.

The 2.73% charged by Amex is actually nominally better than the 2.75% on my UK Citibank Visa.

RichardInSF

I thought I recalled reading that the new US T&C's said they could use a rate "convenient to Amex," which was pretty vague, maybe even a bit scary, and then charge 2% in addition. As you can see in another thread, I am considering dumping Amex for large international charges just on the basis that my MC only charges 1%. It would be shocking if the rate they used was terrible in addition.

I would be most interested to learn more about this.

rives21

i was happy to find this thread. i am currently 3 phonecalls into Amex over this same issue. i travelled from the us to europe for business earlier this month and when i returned i found several discrepencies in the rates i was charged. the mistakes are all with the Euro to USD, but they vary in percentages. So far, amex has given me a good will adjustment to cover the overcharges. but, i told them that this has really shaken my confidence in their accounting and i would like them to audit all of my overseas charges from the last two years. and i want a good explanation for why this is happening. they claim that they are doing this., but i've already had to call back twice and each time, i'm to "just wait longer."
does anyone know of a lawsuit regarding this issue? i would be interested in supporting such an effort.

HKG_Flyer1

I have become distracted with running my business since I raised this issue a few months ago, so I haven't done anything on my end... other than stop using Amex for foreign travel.

Coincidentally, I happened to be going through my old Amex summary from last time I undertook the effort to audit my charges a couple of years ago and found that they ultimately refunded back several hundred bucks.... and that was from just one trip!! This is a major, major issue and the money at stake here is substantial.

Ex Amex Card

Amex are not alone here, Allied Irish Bank recently got rumbled for overcharging their foreign exchange customers.

http://www.ireland.com/newspaper/fro...284HM1AIB.html