Rogue Charges Resurrect Expired Amex Card

Patricia closed her company’s American Express Delta Sky Miles card six months ago, but the expired card unexpectedly sprang to life thanks to a supplier’s accidental charge. American Express laughed off the matter, saying “this happens all of the time,” adding that it’s Patricia’s responsibility to ensure that all vendors destroy her outdated billing information.

She writes:

I handle the credit card accounts for my company. We had an inactive American Express Delta Sky Miles card that hadn’t been used in several years. (3 to be exact) I called AMEX and closed the account informing the CSR that our company had another AMEX account and that was our primary. I was assured the account was closed and moved on.

Come March, our production manager made a small purchase from a company whom we use infrequently and may have had this old account number in their database (a disturbing thought). Now our production manager does not have the old card in his possession, nor does he have the old account number anywhere. One individual, our CEO, had exclusively used this particular AMEX.

I immediately called the vendor and American Express wanting to know how a transaction could clear on a closed account. The American Express CSR informed me that the account was indeed closed, but it was not uncommon for transactions to go through. I was told that recurring transactions will go through. I told the CSR the story that this was a company we infrequently purchase from, and that this card had not been used in years.

The just from AMEX – Since this was a phone order and the physical card was not used to make this purchase the transaction would have been approved. Apparently the vendor also used a dummy expiration date as the old card expired in 2007. Since the vendor keyed in the account number the transaction was permitted to go through. I told American Express that this was an appalling practice – a closed account – especially one closed 6 months ago – was a closed account and any transaction put to that number should have been declined. The CSR kept insisting that it was my responsibility to make sure all vendors eliminated the old information. This is absurd. Oh, and the CSR told me that this happens all of the time. Many of the credit card transactions machine do not require the security code to process a keyed transaction – just a number and date.

I have sent emails to whatever executives I could find at American Express, and I wanted to alert your site to this wonderful practice. I mean I had heard about ISP’s and television services not actually canceling your account, but a credit card company? Seems like bad business practice if you ask me.

American Express isn’t alone in keeping zombie accounts on life support. Bank of America’s never-die accounts are also known for their miraculous rejuvenations, complete with unexpected service fees. The tactic lets creditors cling to customers, while appearing to oblige their reasonable requests to close their accounts. It’s a disgusting practice that should be outlawed.

(Photo: danesparza)

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  1. jayrwasdf says:

    I saw this several years ago with a visa card I had (I think it was MBNA).
    Recurring charges started with a company I was fighting. Then I had to fight MBNA on why the charges were being allowed on a canceled card.

    Nothing is canceled until the bank decides it’s canceled!

  2. loueloui says:

    I’m fairly certain that this was no coincidence. While allowing some recurring charges to go through might be a courtesy to the customer, credit card companies are looking for ANY excuse to push their cards at you.

    Anyone who has had a Macy’s card, even from several years ago, can probably expect a shiny new Citibank Mastercard in their mailboxes. Whether you want it or not.

    This is so disgustingly dishonest. It’s like the neighborhood drug dealer visiting you in rehab ‘just in case you change your mind’.

  3. bvita says:

    I went through this same experience with Microsoft OneCare last week. I bought the program in April 2006 and within 2 weeks figured out that it was worse than the viruses it was supposed to detect.

    I cancelled the account about 2 months after I bought it. The credit card that was given at the time of subscription expired in 2006

    In 2007 they whacked my MasterCard for a $50 renewal on the expired card. Unfortunately I didn’t catch it in time.

    Last week they again whacked my 2 year expired card and again attempted to collect $50.

    I called OneCare and after being treated to an audio trip to Bangalore, was transferred to a “specialist”(a fancy name for customer retention department)stateside. When this drone, who refused to give his name of call center location, figured out that I wasn’t renewing, he got surly, told me to expect a credit within a few days and hung up as he was asking if there was anything else he could do.

    I called CitiBank and put the entire transaction in dispute and advised them that this was a fraudulent transaction.

  4. timmus says:

    This is ridiculous. What happens if you close an account due to fraudulent charges? Crooks can actually get authorization of a charge on a closed account? This is bullshit.

  5. camille_javal says:

    My mind is kind of blown that the guy could use a “dummy” expiration date. So all these extra numbers – expiration dates, security codes – are just a joke?

  6. johnva says:

    @camille_javal: The expiration date means nothing as far as processing. It isn’t checked as a security measure. I think the same goes for the verification codes, though the merchant may be charged a higher rate for certain kinds of transactions if they don’t use them.

    Yes, credit card security is a joke. Luckily, it doesn’t really matter since it’s their liability and not yours.

  7. LAGirl says:

    Same thing happened to me with Capital One last year. It was for a magazine subscription renewal that I hadn’t approved. The worst part was? It was a card closed due to fraud concerns!

    When I called Capital One about it, they told me the same thing as Amex. I think this is just a case of the credit card companies siding with businesses. Once again, customers getting screwed.

  8. boston515 says:

    I had this happen with AmEx. I opened a credit card my freshman year of college. They sent the wrong one and refused to send the card I actually applied for. I closed the account without activating the card. Or so I thought. I received a letter addressed to my dormitory address and my off-campus apartment FOUR YEARS LATER requesting the $55 annual fee with the threat of turning me over to a collections agency. I wrote a very thorough letter with copies of my photocopies from the original letter and receipt of certified mail. Haven’t heard from them since. Wouldn’t be surprised to hear from them in another 4 years!

  9. camman68 says:

    Just a suggestion – and I haven’t tried this yet – but how about reporting the card as stolen, then closing the account? Would future transactions be declined, or would the CC company just allow them to go through?

  10. fitz622 says:

    same thing happened with Xbox live and my HSBC mastercard. The card was expired and they kept sending me emails to update the card that they had on file. I ignored that because I was no longer interested in the service. nevertheless, they kept charging the account. HSBC was adamant in stating that even though the card is expired, the account could still be charged!

  11. basket548 says:

    @camman68:
    Absolutely correct. If you really want to close an account, report the card stolen, get the new one, and then close it without using it for anything. No one has the new number, and therefore cannot charge your account down the road.

  12. Whiskey Tango Foxtrot says:

    I’m curious – I’m in the process of paying down all my debt, and I know that closing a credit card account is detrimental to ones credit score. Is reporting them stolen (after all the debt is paid off) really the only way to ensure that the cards are not either charged again for whatever reason, or used maliciously via ID theft/data breaches? I dread the thought of having to “keep track” of 4 or 5 unused cards that I have to keep open both to protect my credit score, and to ensure no fraudulent charges are made if their information is ever stolen.

  13. FLConsumer says:

    What would be the legality of sending them a certified, return-receipt cease & desist type letter? Something which basically says “I hereby request that my account be closed effective (date). After such date, I will consider the account closed and will not be held liable for any re-opening, fraudlent, or accidental use of said account.”

  14. bbb111 says:

    @basket548
    “Absolutely correct. If you really want to close an account, report the card stolen, get the new one, and then close it without using it for anything. No one has the new number, and therefore cannot charge your account down the road. “

    I did that due to fraudulent charges on my Visa – new fraudulent charges showed up on the old number and they transfered the charges to my new account as a “courtesy.”

  15. humphrmi says:

    Another option – I’ve noticed that companies that never really close their accounts also don’t report them as closed to the credit reporting agencies.

    I haven’t tried this, but it seems like you could challenge the “open” accounts on your credit report, tell the agency that you closed them, then make the credit card issuer prove they’re open.

    It also helps to get paper documentation of your request to close accounts.

  16. Ailu says:

    This makes me convinced that a person must report their card lost or stolen before they close their account, or they are certain to be ripped off. This practice is underhanded and should be illegal, and proves without doubt that the credit card companies are really ran by crooks. That’s why I have no credit cards. I refuse to support the crooks.

  17. doctor_cos wants you to remain calm says:

    I fail to see how you could consider yourself liable in this situation.
    The account is closed, it’s no longer your responsibility. Amex accepted the charge, Amex can take care of the charge. “Is there anything else I can help you with today?”

  18. Lucky225 says:

    Capital One did the same thing, when I changed names on my card the old card still worked when I received and activated the new one that had a completely different account number. This was a Visa card. I’ve never been a fan of AMEX, I used them once to do a balance transfer, they decided AFTER I did the balance transfer that they suddenly didn’t know who I was and was unable to verify my identity and shut my card off requesting that I send in Tax Returns and Bank Account statements for the last 3 years! How the hell do you issue a credit card to someone and allow them to do a balance transfer and then tell the person ‘Well we’re unable to verify you’re identity now’. I told them if they don’t know who I am, I guess *I’M* not responsible for the bill.

  19. Maybe this is why it’s better to get a card with your local bank/credit union… you can go to your local branch, ask the card be closed, and get written verification that at LEAST the request was submitted. I have had cc’s with my local bank logo and I’ve always been able to fix any problems right at the branch. But, I spite bigger companies that screw over the lil man, so it works out fantastic.

  20. parabola101 says:

    BE careful … because if you report a card stolen (for reasons other than stolen) it will appear on your credit report as an “OPEN” account on your credit report. Which can impact you if you are planning on using your credit history for anything…

  21. Ailu says:

    Well, what if you purposely “lost” the card (to the shredder) and then closed the account? Seems then, they just wouldn’t be able to find a way to hold you liable.

  22. sventurata says:

    @camman68: If the transaction falls under the card’s floor limit (in other words, the amount above which purchases are individually authorized by the cardissuer’s bank, not the merchant’s), it will go through, even on a stolen card.

  23. camman68 says:

    @Mrs. Basil E. Frankweiler: I did not know that. Am I still responsible or liable for charges to card after it has been reported stolen or lost?

  24. sventurata says:

    Nope. Thank God. They eat the costs of having shitty technology.

  25. jimconsumer says:

    Hahahaha… Fuck these credit card companies. Seriously. If I closed an account and they let people charge to it months later, I’d say, “Sorry, I’m not paying. Period.” When they sent bills, I’d write “Fuck off, I closed this account 6 months ago” and mail them back without payment. If they harassed me or sent me to collections, I’d sue their ass.

  26. LSonnenhimmer says:

    I know this is an older post, but I thought I should share.
    Apparently all Credit Card companies have a practice of allowing a charge to a closed account. Even if the account was closed because of a stolen card. It only applies to recurring charges. In my case Chase Visa. Its called a “pushed” charge. Its allowed because you signed a contractual agreement with the merchant (hence the recurring charge requirment). The credit card company falls back on to the merchant, and the merchant waives the contact in your face, thereby proving the charge was legit even if the account was closed.

  27. Anonymous says:

    You know. This just happened to me as well on an account I closed over three years ago, and I got the same responses from Amex. In this case, my number appears to have been copied down by a contractor who was in my house. My daughter had found the old card in a drawer was playing with it and left it out. The contractor was in our house on Friday Nov. 7, and then on Sat. Nov 8 someone used this Amex card to pay for Dish Network service. Amex did contact me about suspicious activity – but I was appalled to learn that it was on an account I had closed more than three years ago. Amex told me they approved the $336 charge from Dish because it was submitted by the company – not swiped. I have never had a Dish account. I still can’t believe I am even in this situation. I then called Dish to see if they could tell me whether someone had used my old Amex number to pay a bill. And sure enough, they had a payment approved for $336. Dish would not tell me name of the account holder but verified it was not me or my address. They did confirm that the person who used my old Amex # used the phone pay system and Amex approved it. They also confirmed that whoever made the charge lives in my metro area. The only way I could get the info they said was to call the police and have them investigate. So now I had to invite the police over and they are opening an investigation. All because Amex has a clear flaw in its system. Also, Amex tried to tell it was policy not to reject these kinds of charges due to some consumer protection laws. Not sure I am buying that one. So, it seems that when you close a credit card with Amex, and someone happens to gain access to the old account #, Amex will approve charges and reopen your account. Amex is now sending me a bill which I have to fight through their fraud department.