American Express Settles $230M Fraud Case

American Express will pay approximately $230 million to settle federal investigations into deceptive marketing practices and wire fraud allegations. The settlement includes a $138 million payment as part of a non-prosecution agreement with the U.S. Attorney's Office for the Eastern District of New York, addressing claims of providing inaccurate tax advice on wire products marketed to small businesses from 2018 to 2021. Additionally, American Express will pay a $108.7 million civil penalty for breaching the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) by deceptively marketing credit cards and allowing the use of falsified Employer Identification Numbers (EINs) between 2014 and 2017. The company has cooperated with authorities, discontinued the products involved, and implemented internal changes to prevent future misconduct. Approximately 200 employees were terminated following an internal investigation, and American Express aims to restore compliance and trust in their operations. This resolution holds American Express accountable for their misleading sales tactics, ensuring they address the unacceptable conduct of their sales employees.