FBI investigating the prices of American Express foreign currencies

The investigation, which is being conducted by the local FBI office in Washington, is in its infancy and focuses on whether the department of international payments in foreign currency misrepresented prices to customers to win their business .

The FBI began its investigation in August, according to the newspaper, after the Wall Street Journal, citing current and former employees, announced that the AmEx foreign exchange unit had recruited customers offering low conversion rates before the 'raise prices.

A spokesman for AmEx declined to comment on the FBI's investigation. In July, AmEx stated that it took the allegations very seriously and proceeded to a review. Unit employees were instructed to avoid deleting e-mails, people familiar with the instructions said.

The FBI is in the gathering phase of the facts of the investigation, said the familiar people. The office is contacting AmEx and waiting for the company to answer a list of questions, they said.

The Money Controller's Office also examines how AmEx communicated pricing to customers, including what customers were aware of potential rate increases and who knew the practice within the company, according to a report. anyone familiar with the investigation. AmEx declined to comment on the OCC.

On July 30, the newspaper reported that AmEx's international currency payments service was steadily increasing conversion rates without notifying customers, to increase revenue and employee commissions. The practice took place until the beginning of this year and goes back at least to 2004, said the former and current employees at the Journal.

AmEx's forex business, which largely serves small and medium-sized businesses, represents less than half a percentage point of the company's total revenue.

According to current and former employees, sales representatives would suggest to potential customers to beat the prices they paid to banks or other financial institutions to convert their currency and send money abroad. Representatives did not inform customers that the margin, a margin that AmEx adds to the exchange rate of the base currency, was likely to increase without notice, they said.

Employees in the unit would later increase the margin without notifying customers, said the current and former employees.

Officials asked sales representatives to keep details of vague payment terms when discussing with potential customers and to avoid setting price conditions in writing, said the current and former employees.

Write to AnnaMaria Andriotis at [email protected]