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BobWang

The Master American Express AmEx Additional Cardmember Employee Authorized User Responsibility Thread

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Centurion Bank AmExes are unique in that on the back of every card is this language:

USE OF THIS CARD IS SUBJECT TO THE CARDMEMBER AGREEMENT

Each AU has a unique card number,
and usage of the card obligates the AU to the Cardmember Agreement.

However, ONLY the Primary Cardmember is jointly and severally liable for AU charges.
IOW, an AU is NOT responsible for the Primary’s or other AUs’ charges.
Usually, the Primary is the one with deeper pockets,
so AmEx will go after him/her/it first.

*IF* the Primary is not capable of paying,
THEN AmEx can go after each and every AU under the Cardmember Agreement,
that EACH AU agrees to implicitly, by using the card

AmEx Cardmember Agreements:

https://www.americanexpress.com/us/content/cardmember-agreements/all-us.html

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BobWang, on 29 Apr 2013 - 16:53, said:

Centurion Bank AmExes are unique in that on the back of every card is this language:

 

USE OF THIS CARD IS SUBJECT TO THE CARDMEMBER AGREEMENT

 

Each AU has a unique card number,

and usage of the card obligates the AU to the Cardmember Agreement.

 

However, ONLY the Primary Cardmember is jointly and severally liable for AU charges.

IOW, an AU is NOT responsible for the Primary’s or other AUs’ charges.

Usually, the Primary is the one with deeper pockets,

so AmEx will go after him/her/it first.

 

*IF* the Primary is not capable of paying,

THEN AmEx can go after each and every AU under the Cardmember Agreement,

that EACH AU agrees to implicitly, by using the card

 

AmEx Cardmember Agreements:

 

https://www.americanexpress.com/us/content/cardmember-agreements/all-us.html

That language used to be there. No more. The language is explicit that the basic cardholder is the one responsible for paying the bills including those of AUs and anyone they or the additional cardmember(s) allows to use the card(s). Generally, language that is at all ambiguous is interpreted favorably to the person that didn't write the contract.

 

On the Amex Plat agreement, there is a curious reference to "See about additional cardmembers" on Pg 4 of section 2. It's curious because there is no such reference on page 4. Me thinks their lawyers need to do a better job proofreading. It's also consistent with a recent change involving additional cardmembers where referenced sections slip through the cracks.

Edited by cashnocredit

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The "Cardmember Agreement" covers "Cardmember", whether Primary or Additional.

 

Any Additional Cardmembers are bound to the same Cardmember Agreement.

 

The difference is that ONLY the Primary is "Joint & Severally" liable.

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Look at all your other credit cards.

 

None of mine have the language of accepting "Cardmember Agreement" just by using the card.

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My Freedom card has identical "use of this card..." language.

 

 

I don't see any language on the Cardmember Agreement re Additional Cardmember liability: I do see this:

 

You promise to pay all charges, including:

● charges you make, even if you do not present your card or sign for the transaction,

● charges that other people make if you let them use your Account, and

● charges that Additional Cardmembers make or permit others to make.

 

And this:

 

We, us, and our mean the issuer shown on page

1 of Part 1. You and your mean the person who

applied for this Account and for whom we opened

the Account. You and your also mean anyone

who agrees to pay for this Account. You are the

Basic Cardmember.

Edited by cashnocredit

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I guess I don't carry Chase cards in my wallet.

 

Any issuer can go after an AU for their purchases, if the primary defaults.

 

 

A defense of "I'm not responsible for paying for my own purchaes" usually gets little sympathy.

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I guess I don't really understand the confusion,

 

an AU signs for purchases, swipes or whatever,

 

as an indication of agreeing to pay for the purchase.

 

AmEx is just simplifying the language to reduce confusion about Cardmember liability.

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I guess I don't really understand the confusion,

 

an AU signs for purchases, swipes or whatever,

 

as an indication of agreeing to pay for the purchase.

 

AmEx is just simplifying the language to reduce confusion about Cardmember liability.

 

I don't think Amex removed the language specifying that Additional Cardmembers were responsible for their charges in the event the Basic Cardmember didn't pay without the specific intent to exclude Additional Cardmembers from liability. It's just not something companies do without thought. This just brings Amex into alignment with other issuers who do not hold AUs liable for their purchases.

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Any issuer can go after an AU for their purchases, if the primary defaults.

 

I don't think there is any case law that supports that statement.

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I'm not a lawyer, but signing a credit card receipt is a promise to pay.

 

It's not a promise that someone else will pay.

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I'm not a lawyer, but signing a credit card receipt is a promise to pay.

 

It's not a promise that someone else will pay.

BobWang,

 

Well, that's how I look at it too but I'm afraid my gf looks at signing her AU CC receipt as a promise that I will pay. The bank seems to have the same idea. Come to think of it, I've bought into the idea as well.

 

I'm not a lawyer either but I'm pretty conversant with some corners of the law having done all the legal work of properly setting up and running a corporation for close to 10 years before the business was so large that my time was better spent elsewhere. I also took care of my own legal stuff when I later became an SEC statutory insider (Section 16) including making my own EDGAR filings. I started off with this DIY approach, which I do NOT generally recommend, for two reasons. First, I initially couldn't afford it. Secondly, the DIY approach provided enormous legal structure insight and informed better business decisions. This is valuable when small, less so as one grows.

 

Jokes aside, I have great respect for lawyers and have a pretty good understanding of when to seek specialized council.

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As an aside, there is also a lot of misinformation out there about the need for a "written signature" to bind a creditor. Federal and State laws of adopted the use of Web "signatures" and even emails as equivalents. People need to understand that. When you open an online account it doesn't need to be in writing to be valid and it binds both parties absent fraud.

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Yup, Costco doesn't even require a signature below $200 now.

 

And to my AUs:

 

DON'T EVEN THINK ABOUT IT. :D

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The relationship between Costco and Amex is mutually productive in so many ways. The membership reqr. probably reduces fraud risk by a large factor and may well be a positive correlate with account performance elsewhere though not to the same degree.

 

Costco had a "one of sale" on a huge diamond ring last year. Price was 500k. I have wondered if it was purchased with an Amex. Wouldn't surprise me. Way out of my league though.

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