Last month an American Airlines passenger got a huge surprise on their American Express statement. They refunded an American Airlines ticket, expecting $1,000 back. Instead, on February 21, American sent them $100,000.
The money wasn’t theirs! They quickly called American – but agent after agent insisted everything was processed correctly. They escalated to executive emails and social media. American kept insisting “the refund is correct.”
They might have stopped there, kept a record of everything, and sat tight. However they were worried – the ticket was purchased outside the U.S., so not in dollars. If American came back later, and exchange rates moved against them, they could be out real money.
They escalated things with American Express and even tried to ‘dispute’ the refund. Eventually, everyone agreed that this was a mistake – but nobody could fix it. American processed an adjustment for the erroneous refund on February 27th – and charged them $28 million.
That was a lot of Membership Rewards points, billed to the passengers Platinum card. But they were afraid they’d be literally bankrupted by the mistake. They didn’t have $28 million!
Then on March 1, American Express suspended their account due to “high credit exposure.” It was a weekend full of stress, because no one working outside of normal business hours had the authority to correct a $30 million error. Come March 3, though, Amex acknowledged multiple errors. But they could delete the mistakes, they had to fix them.
By the next day, the $28 million charge was netted out. However there was still another incorrect $300,000 refund that got added during the attempts to ‘fix’ the problem – and currency conversion
costs and losses of $75,000.
Amex did get this cleaned by later in the month, both American Express and American have apologized – and offered compensation that the passenger refuses to discuss other than to say,
The value of the compensation is more than the interest I would have earned for $100K in 1 week in a [high yield savings account], and in the range of what [Southwest and Delta] offered to affected pax during their respective meltdowns.
Everything was wrapped up by March 24, ending four stressful weeks at the mercy of two mega-corporations and an inability to sort through errors.