Consumer complaint received 2019-06-30
Company: AMERICAN EXPRESS COMPANY
State: IL
Product: Credit card or prepaid card
Sub-product: General-purpose credit card or charge card
Issue: Other features, terms, or problems
Sub-issue: Problem with balance transfer

Complaint:
I believe I was subject to deceptive marketing practices during an application for an American Express product. 

I received a pre-approval offer in the mail for an Amex XXXX Credit Card. On XX/XX/19, I followed the instructions to apply at the provided URL ( amex.us ) In the physical materials presented in the letter, and provided my personal information. I was then presented with a Terms and Conditions page. I read the Terms and Conditions and pressed Agree & Submit Application. 

On the subsequent screen, I was presented with my credit limit of {$25000.00}, and a maximum balance transfer limit of {$5000.00}. I was also prompted to provide the credit card number ( s ) for the balance transfer ( s ). However, prior to this screen, I had not been briefed on the {$5000.00} limit, nor on any limit other than the corresponding credit limit on the card. 

However, had I known this information in advance, it would have changed my decision to apply for the product and avoided the addition of a hard inquiry to my credit report and a subsequent lowering of my credit score. 

I immediately contacted Amex at XXXX ( XXXX ) XXXX to express my concern. I spoke to a representative and described that I was in the midst of an online application process for an Amex XXXX Credit Card, and that I had just been presented with the {$5000.00} balance transfer limit. I also noted that this information was not presented in the physical materials accompanying my pre-approval letter ; nor was it present in the terms & conditions screen on the online application process ; nor was it present in the Amex XXXX Credit Card Cardmember Agreement available from the Amex website at https : //www.americanexpress.comXXXX 

The representative told me he was forwarding me to a different department. I was subsequently forwarded back to the options menu I had originally been presented with when dialing the aforementioned number. I was not forwarded to a different department. I proceeded to navigate through the options once again, and for the second time I narrated the above concerns to a different representative. This time, the representative once again told me he would forward me to a different department, upon which I was dialed to a number that immediately hung up. 

For a third time, I contacted Amex at XXXX ( XXXX ) XXXX to express my concern. I re-narrated the fact I was in the midst of an online application process after following the steps in a physical pre-approval letter. I noted once again that my concern that the balance transfer limit amount was not stated anywhere in the application or terms and conditions. The representative helpfully forwarded me to a different department and briefed the other representative on my narrative. 

For the fourth time, I spoke with this other representative and re-stated my concerns that the maximum balance transfer limit was not presented anywhere in the application process or terms and conditions. The representative confirmed that {$5000.00} was the maximum balance transfer amount for the Amex XXXX Credit Card irrespective of creditworthiness. I believe that this is a deceptive marketing practice as this information could have easily been conveyed in the physical paper headlined Important Information regarding Rates, Fees, And other Cost Information or in the online Terms & Conditions presented earlier in the process. The representative confirmed that the {$5000.00} limit is not stated anywhere in these materials. I suggested to the representative that this information be added to the terms and conditions. The representative noted that she had recorded my suggestion, but that there is otherwise nothing she could to increase the balance transfer limit on the application as it is a universal limit for all Amex XXXX Credit Card applications. The representative also confirmed that this application is accompanied by a hard inquiry. 

It is common knowledge that a greater number of recent hard inquiries negatively impacts ones credit score.  Thus, my credit score, and by extension my creditworthiness, was negatively impacted by the deceptive marketing practice performed by American Express. 

For reference, I am reproducing below the full Balance Transfer clause from the Terms and Conditions section in the physical letter I received that was identically stated in the Terms and Conditions in the online application process. 

Balance Transfers : Only balance transfers from accounts in your name requested within 60 days from the date of account opening will be approved. We will charge your Card account for the total approved amount of all balance transfers. Each transfer will reduce your available credit just like any other transaction. You may request a balance transfer up to the eligible transfer amount, which will be based on your credit worthiness and other factors including your account history with American Express. You may not request a balance transfer amount less than {$100.00} and the total amount of balance transfer request ( s ) must not exceed your credit limit. We will not initiate any balance transfer until at least ten days after we have mailed or otherwise provided the Card Member Agreement to you. In some cases, it may take up to six weeks to complete a balance transfer. Please be sure to make all required payments on any account from which you are transferring a balance until the balance transfer is credited to that account. You authorize us to verify the balance of such accounts. You may not transfer balances from any account issued by American Express or any of its affiliates. Additional Card Members may not request or authorize balance transfers. 

Note that this clause states You may request a balance transfer up to the eligible transfer amount, which will be based on your credit worthiness and other factors including your account history with American Express. You may not request a balance transfer amount less than {$100.00} and the total amount of balance transfer request ( s ) must not exceed your credit limit. Any reasonable person would interpret the latter statement as stating that the balance transfer limit could potentially be as high as the credit limit on the credit card. Moreover, any reasonable person would interpret the former statement as stating that better creditworthiness implies a higher balance transfer limit. Under no circumstances is it possible to infer from this clause that a hard {$5000.00} balance transfer limit is present for applications for the Amex XXXX Credit Card. 

It is altogether fitting that Amex disclose this information in their Terms and Conditions, as it is material information that may affect whether or not a consumer decides to apply for this product, and subsequently affects their creditworthiness by way of a hard inquiry.

Company response to consumer: Closed with explanation