American Express might wrongfully charge a "merchant fee" to retailers and merchants on items purchased using an American Express Card but subsequently returned by the consumer to the merchant.

This is an ongoing investigation which has led to a pending class action lawsuit against American Express Company in which it alleges that American Express wrongfully charged merchants and retailers a fee for goods and services not actually purchased using an American Express card.

American Express cards are held by millions of business and consumers throughout the country. American Express requires a merchant, retailer and any business for that matter to enter into a contract with American Express if that merchant wishes to allow a consumer to purchase that merchant's products using an American Express card. That contract provides that when American Express extends credit for a purchase, the merchant must pay a percentage of that sale to American Express. American Express's fee is called a "merchant fee" or "discount fee".

The class action lawsuit alleges that American Express charges a merchant fee on items returned or items where American Express does not actually extend credit. The class action lawsuit alleges that American Express's practice of charging a merchant fee on items returned or for which credit is not extended is not disclosed in the agreement merchants are required to execute with American Express.