American Express Modifies Credit Card Offer Terms

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American Express has updated the terms on its credit cards. The added terms and conditions are related to new accounts, their associated bonuses and your first year of card membership. The new terms (bolding our emphasis) are as follows:

If we in our sole discretion determine that you have engaged in abuse, misuse, or gaming in connection with the welcome bonus offer in any way or that you intend to do so (for example, if you applied for one or more cards to obtain a welcome bonus offer(s) that we did not intend for you; if you cancel or downgrade your account within 12 months after acquiring it; or if you cancel or return purchases you made to meet the Threshold Amount), we may not credit Membership Rewards points to, we may freeze Membership Rewards points credited to, or we may take away Membership Rewards points from your account. We may also cancel this Card account and other Card accounts you may have with us.

These terms are from a Membership Rewards earning credit card; however, you'll see similar terms across other American Express card products as well.

What This Means

The changes affect three key areas:

  • Amex can take back a bonus not intended for you. So if you find an offer following a link not intended for you, it could result in you losing any awarded bonus.
  • Amex reserves the right to take back welcome bonuses if you cancel the card within 12 months of opening your account.
  • Amex also reserves the right to take back bonuses and close your accounts, if you cancel or return purchases that were used to meet the minimum spending requirement.

The change in wording, while strong, is not a big surprise. American Express is taking steps to protect itself and identify the terms and conditions it expects from its customers. Each one of the three changes serves this purpose.

Firstly, a targeted bonus is designed to attract specific clients. If you're not one of those people, the bonus isn't for you.

Secondly, credit card companies want to establish long-term relationships with reliable clients. The welcome bonus offers, while lucrative, are not necessarily the strongest aspect of a card product (for example, with  The Platinum Card® from American Express you can earn 5X Membership Rewards® points on flights booked directly with airlines or with American Express Travel. 5X Membership Rewards points on prepaid hotels booked on amextravel.com.). While the welcome bonus offer is enticing, the company wants to build ongoing relationships by offering an overall strong product.

Lastly, any transaction has three parties: the seller, the buyer, and the credit card company. If you cancel or return the goods, the seller has their goods/services returned, the purchaser has their money returned, so it is only fair that the credit card company has their points returned also. Sounds like common sense, but spelling them out doesn't hurt.

Our Take

While the language change is new, this is not particularly surprising since credit card companies have reserved the right to take back points/close accounts that they suspect are being abused.

Source: One Mile At A Time

American Express Modifies Credit Card Offer Terms
4.2 (84%) 5 votes
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Comments

  • Does this mean that one would not want to cancel an Amex credit card until almost the second anniversary of the credit card approval?

    • That’d be your decision to make as far as when to keep/cancel a card. To stay in line with the terms and ensure any bonuses stick, you’d want to keep any accounts open for at least 12 months.

  • While it doesn’t make sense to close a new account within 12 months, how does this work for their Delta cards?
    My understanding is that banks can’t recall miles that have already been sent over to an airline.

    • These terms are brand new, so we can’t speak to how they’ll work in reality over time. Given the strong relationship between American Express and Delta, even though we haven’t historically seen miles retracted from an account, I wouldn’t rule it out.

  • angelo fonseca says:

    Looks like they’re just trying to stop fraud.

  • Let’s just hope they don’t change the practice/policy of refunding annual fee when canceled within 30 days of it posting.

  • A lot of people are leaving American Express, its not taken in a lot of places, especially overseas , When Costco dropped them, it hurt them, Other cards offer much better bonus and savings than AX. With Delta Skypesos so hard to use and with their devalued chances of using them, AX is good to get rid of, I am considering it as the only big saving is on baggage fees, and with a $95 fee for the card, that will buy you a few bags on board.

    • Its the Pretend Spenders that will be leaving, the Real Spenders aren’t leaving n big numbers.

      Chase is also at a crossroads of sorts with their CSR, will be interesting what they cut when their renewals don’t meet expectations starting next month.

  • Well if it says keep it less than 12 months – just cancel it when the annual fee hits

  • Wow that’s pretty strong language.
    Hopefully this won’t spread to other cards.

  • charles j says:

    While I totally understand not honoring an offer made in a targeted offer, or withholding or taking back points posted based on purchases that are later reversed or credited back, taking away bonus points if a card is cancelled within 12 monthes presents a problem. Not that I prefer it, but maybe they should just make that a requirement for keeping a bonus. I Besides the question about what happens with a bonus made and transferred to Skymiles, I wonder what happens if someone gets a Membership Rewards points bonus, and does not have enough points if they try to take it back a year later. It doesn’t say that your account will be charged for the value of the points.

  • While my spending habits have never precipitated any questions, or the dreaded Financial Review, it is still disconcerting that these changes to the offer terms essentially give AmEx the right to claw back any bonus points for any reason, any time. I’ll definitely be thinking long and hard before any future applications, and that’s probably not the right mindset to instill in customers to drive business. Seems a bit like cutting off one’s nose to spite one’s face.

  • I think AX should solve the targeted bonus issue by themselves. They can easily deny the application. How can I know that the link I found online is targeted or not? For example, I can not find any words like “not targeted” or “for everyone” on any of CC links on this page.

    But I’m totally ok with other two.

  • How does I tell if an offer “is not intended” for me? Obviously, if I receive a personalized mailing or email then it is intended for me. But the vast majority of cards I apply for are from links provided on a blogger websites. How would I tell if such a link “is not intended” for me?

    • To a certain degree, you need to trust that the blogger is providing you links that are publicly available offers and not something targeted. The safest approach would be to compare what you see on a blog with what you see directly on a credit card companies website.

      When in doubt, it never hurts to ask. Keep in mind, this site and many other blogs have affiliate relationships with credit card companies. Those that have relationships are likely to only provide publicly available offers, but again, it is your responsibility to do a little due diligence.

      That said, at least here, I can assure you that we’ll be posting only publicly available offers.

  • Keva Coulson says:

    Certainly factors to consider, if you ‘play the game’ a little too hard.

  • Another reason to dump Amex for Chase.

  • Alice Chen says:

    This, along with the fact that most merchants don’t take Amex abroad and some in the US don’t either, makes this really unattractive.

  • looks like it’ll be safer to cancel the card after the annual fee posts and/or after 12 months, whichever is later.

  • Are these terms for current card holders or for new members only? I understand they need to cover themselves but this may hirt them in the end.

    • These terms changes are for new card members; I’m not sure if they could apply such requirements on existing card members, but I wouldn’t rule it out. Regardless, if current card members had these requirements brought upon them there would be some notice from American Express about the change in terms/conditions. If you have questions about your specific offer terms you’re best to reach out to Amex directly.

      • While it would be nice if they didn’t, it wouldn’t be surprising at all, to me, if AmEx began applying these standards to existing accounts.

  • Amex is definitely paying more attention to those seeking rewards. Tread carefully.

  • this does not seem to be unreasonable

  • So we must pay at least one year annual fee now if can’t cancel within 12 months?

    • Not necessarily. If after having the card for 12 months you don’t feel as though the product makes sense for you, you can cancel/close and not worry about losing any earned rewards. When you are charged an annual fee and when it is due is likely going to be that buffer for you.

  • AMEX needs to start giving some love to
    It’s longtime customers .

    • While I certainly won’t object to any additional perks — and this isn’t the first time someone has said this, can you think of an example of another card issuer doing something special for longtime customers? I’ve been racking my brain and can’t think of anything significant across the industry. I don’t think Amex deserves to be singled out here.

    • worldtraveller73 says:

      No kidding.

      How about instead of a one time high sign up bonus that they spread it out over a few years or higher levels after higher spend?!?

      They are their own worst enemy with “first year free” in some cases.

  • Slightly worrisome that companies are taking these steps as they will start to interfere with the game but nothing that wasn’t to be expected

  • Just make sure you hold on to the card for year or so, and then get rid of it.

    Either way Im not getting any amex cards for a while so it doesn’t matter.

  • Wow! Glad you’re watching the fine print for us. If I do apply, I’ll be doing it by phone and with the full offer read to the rep on the line, using my recording app. This whole game about taking back a bonus you’ve been given due to their mistake is ridiculous. As someone said above, get your database in order and deny it at the start, not come back later after we have used the card and made you money based on the offer we were drawn into through a web page or online ad.

  • Curbing on fraud, not necessarily a bad thing for everybody else…

  • “if there were better long term bonus rewards when compared the sign up bonuses”

    Amen to that. You nailed it.

  • Wow. The rest of us always pay for fraud. I guess that if you want to make sure whatever you charge sticks you’ve got to keep the account open until it clears whatever program and make sure you don’t charge anything on it so you don’t lose anything and know for sure you can close your account. At least you wouldn’t have to carry the card around with you, however, then you’d have to remember to cancel. Anything about non activity rules changing?

  • jason picker says:

    Good for AMEX, too many people committing fraud/taking advantage of offers that wasn’t intended for them.

  • Amex has to be tough. The card cycle club is hurting all the CC companies. No simple answer since it is competitive business. Make the terms strictest possible so they have right to take back bonus if they feel someone is abusing it. For the most part Amex service is very good. So glad I got the AMex Hilton 80k bonus before the new rules.

  • Amex is great. they could use less rule though.

  • Question. If I remember correctly, the term used to said the sign up bonus is only valid if you don’t have the same product before. I can not find any similar wards in the new terms. Does it mean that you can get the bonus again?

  • I like Amex and I think this may help with curbing fraud.

  • Agreed. This is so frustrating. I get not awarding points for cards I don’t use, but the ones I put a lot of spend on, I think I deserve a bonus.

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