The Australian Competition and Consumer Commission has required American Express to write to its affected customers clarifying its recent offer of fee free credit cards after a number of consumer complaints.
The complaints concerned a recent American Express offer to consumers of a 'no annual fee' Blue American Express credit card in which the conditions of the offer also included, in the 'fine print', the conditions that an annual fee could be charged in the first year or after the first year.
As a result of the complaints the ACCC has agreed that American Express will:
- write to all persons who have applied for the American Express Blue Card in response to the offer in order to clarify the conditions of the offer
- provide an explanation to the ACCC as to why the American Express offer was sent out in a form that was potentially misleading to consumers
- implement an audit of its existing trade practices compliance program to ensure that the program complies with the Australian Standard for such programs.
"The mail-out has gone to 281,500 consumers," ACCC Chairman, Professor Allan Fels, said today. "There is a risk many may have been misled.
"Offers made by credit card providers must clearly explain the terms and conditions connected with the card, especially the associated fees. Representations that mislead a consumer as to exactly how much he or she will be required to pay is likely to breach the misleading conduct provisions of the Trade Practices Act 1974.
"When the fees charged for a card depend on the total value of transactions or vary from year to year, it is important that this information is displayed prominently and not relegated to the fine print.
"I encourage any consumer who believes that they may have been misled about the terms and conditions associated with credit card applications to contact the ACCC".
The ACCC acknowledges American Express' co-operative approach in resolving this matter.
Consumers wanting more information about the ACCC and its role and responsibilities should visit the ACCC web-site at www.accc.gov.au.