Not upheld: unfair treatment during financial difficulty; failure to provide forbearance; interest rate increases; account default and DCA referral complaint against American Express Services Europe Limited

Decision detail

Summary

Mr M complained that Amex treated him unfairly during financial difficulties by continuing to charge high interest rates, increasing interest rates, applying charges, defaulting his accounts, and referring them to a debt collection agency without offering appropriate forbearance. Amex argued they attempted to contact Mr M multiple times and acted within the credit agreement. The ombudsman found that Amex made over 100 call attempts and sent dozens of communications offering help, that Mr M's payment pattern was inconsistent (including occasional large repayments), and that when Amex did speak with Mr M he either indicated oversight or confirmed temporary issues. The ombudsman concluded Amex could not have done more without Mr M explicitly requesting help and providing financial information, and that interest rate increases and DCA referral were within the credit agreement terms. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Amex made substantial efforts to contact Mr M through over 100 call attempts and dozens of communications offering help and encouraging him to get in touch. The ombudsman noted that Mr M's payment pattern was inconsistent, with occasional large repayments suggesting he was not in continuous financial difficulty. When Amex did speak with Mr M, he either said he didn't see the due date or that his issues were temporary and affordability was confirmed. The ombudsman concluded it would not have been proportionate for Amex to unilaterally suspend interest or set up payment arrangements without Mr M's agreement and proper income/expenditure assessment. The interest rate increases were permitted under the credit agreement terms, and Mr M had the option to opt out. The ombudsman found Amex acted within the credit agreement in passing the accounts to a DCA.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website