American Express said it was conducting a review with an external party after a report about sales tactics in its foreign exchange business.
The card issuer is the latest to attract scrutiny for allegedly using bait-and-switch sales practices. The Wall Street Journal reported on Monday that the card company's foreign exchange unit recruited small business customers with low currency conversion rates only to quietly raise those rates later without notification. The practice, which ended earlier this year, went on for more than a decade, the report said, citing people familiar with the matter.
Small business are a major source of growth for Amex, which recently won the right to issue a new credit card for Amazon's small business customers.
In a memo to employees on Monday, Amex said it takes the allegations "very seriously" and was doing the review "to determine whether all of our standards are being met."
The memo also said "If we find that we fell short of the mark, we will fix the problems and take appropriate actions to make sure it doesn't recur."
Banks have long used introductory offers to win over new customers, only to raise rates or otherwise make the products more expensive down the road. And a recent survey reveals that despite the high profile sales scandal at Wells Fargo & Co., bank employees still feel pressure to meet sales goals.
Tying sales to bonuses or other incentive awards has been a long-standing practice in banking, where many employees are paid by the hour. Abuses such as the practices uncovered at Wells Fargo two years ago, where employees opened fake accounts in customers names just to meet aggressive sales hurdles, has put a new focus on how banks reward employees for selling products.
But despite the scrutiny, the failure to meet sales quotas can still result in bullying, retaliation or possible termination, according to a recent survey of 400 employees of some of the nation's largest banks by the National Employment Law Project and consumer groups making up the Committee for Better Banks.
More than half of the respondents in the survey said hourly pay was supplemented by incentive awards or other bonuses, and 56 percent of the goals were based on the amount of sales made, not customer satisfaction (that category got just 14 percent.) The survey included employees at big banks like J. P. Morgan Chase, Bank of America and Citi but not American Express.
Nearly half the respondents said failing to meet goals would result in a one on one meeting with a supervisor, while one-quarter said it would result in disciplinary action and slightly more than that said it could lead to termination. Just 10 percent said there were no consequences.
A spokeswoman for Amex told CNBC in an email that the company's offered foreign exchange rates are competitive with the current marketplace and that the rates, with the exception of a few larger clients, aren't based on a contractual pricing commitment or spread agreed to in advance.
"The system is designed to allow clients to compare our offered rates for their transactions with the rates available from our competitors," the spokeswoman said. "We have training, control and compliance oversight and believe that our transactions are completed and reported in a fair and transparent manner at the rates which the client has authorized."
The WSJ report said Amex's sales people who hit their targets got a commission of 15 percent of the monthly revenue new customers generated, and the commission rate rose to 25 percent once an annual revenue target was exceeded.
Read the full WSJ report here.