American Express Account Closures Reported by Cardholders
American Express has been in the news lately for closing and blocking customer accounts in recent weeks. The exact reason for these shutdowns remains unclear, but the company has been known to take action against fraud, compliance checks, and violations of terms of service.
In the past, American Express has reportedly closed accounts due to self-referrals, purchasing gift cards, overusing the pay-over-time feature, prior financial review, and maximizing AmEx offers. This time around, self-referrals seem to be the most common reason for the account closures.
For the uninitiated, a self-referral is when an individual refers themselves to a credit card and pockets both the referral bonus and the welcome bonus. Some users who did a lot of self-referrals ended up with negative Membership Rewards balances, leading to the closure of their accounts. American Express has been removing any points associated with self-referrals from accounts identified as having benefited from self-referrals.
Account holders who transferred their Membership Rewards points to an airline prior to account closure were able to prevent losing their points. However, speculative point transfers generally carry the risk of unused miles or points devaluing over time.
Other credit cards on the market may offer attractive alternatives for those affected by the recent American Express shutdowns. For instance, the Wells Fargo Autograph® Card has no annual fee, while the Capital One Venture Rewards Credit Card provides flat-rate travel rewards. The Chase Sapphire Preferred® Card offers flexibility, point transfers, and a large bonus, and the Chase Sapphire Reserve® offers bonus travel rewards and high-end perks. The Ink Business Preferred® Credit Card is suitable for business travelers, and The Platinum Card® from American Express offers luxury perks.
It's worth noting that American Express continues to crack down on behavior considered abusive, as evidenced by the recent shutdowns. In this instance, there wasn't much choice for users facing account closure.
Despite the recent account shutdowns, American Express remains a popular choice for many credit card users. It's important for all cardholders to familiarise themselves with the terms and conditions of their cards to avoid any potential issues down the line.
