AMEX may be known for having some of the best customer service among credit card issuers, but it also has a dreaded sword hanging over cardholders: Financial Review. If you accidentally trigger this mechanism and fail to get through it smoothly, the result can be all your credit cards being shut down and your points being confiscated. Today I’ll share some basic knowledge about Financial Review (FR), how the process works, and also my own experience being put under FR.

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【10/19 update】After being subjected to FR, in addition to having a limit imposed on my charge cards, there were actually many hidden restrictions. For example, my charge cards stopped receiving pay over time bonus deals and some targeted spending deals. However, around the one-year anniversary of my FR, AMEX sent me a letter saying it had removed the spending limit on my charge cards. It seems AMEX probably has some kind of periodic review mechanism as well. After that, I received a spending offer for PRG. So it looks like this FR episode has finally come to a satisfactory end ~

What Is AMEX Financial Review (FR)?

Credit card companies and banks each have their own ways of managing risk. Once they believe you, as a cardholder, pose a significant risk, they can shut down your accounts to avoid that risk. Citi and Chase are the types that may simply close accounts outright, while AMEX has its own process and will usually put you through a Financial Review (FR) before shutting your accounts down.

Literally speaking, FR means AMEX needs to examine your financial situation, usually your income. If your income does not appear sufficient to support the spending on your existing credit cards, AMEX may use that as a basis to lower your credit limits or even shut down all of your cards outright. During FR, all of your AMEX cards will be unusable and show as charging suspended until you pass the review. Although FR may last only 10-20 days, it is still very stressful for cardholders. If all your cards get shut down, all of the cash back and Membership Rewards in your AMEX accounts may be confiscated.

Possible Reasons for a Financial Review

There can be many reasons for being subjected to an AMEX FR, but the main one is simple: AMEX thinks you may not be able to pay your bills. Common reasons include:

  • Returned payment
  • Opening many AMEX credit cards in a short period of time
  • Large spending in a short period or a major change in spending pattern
  • Inflated income reporting or a serious mismatch between income and spending
  • Total credit limit too high / credit limit-to-income ratio too high
  • High balances on credit cards and charge cards
  • Too many authorized users
  • Opening business credit cards with heavy spending (very easy to trigger FR)
  • Someone else at the same address or an authorized user being subjected to FR

In fact, the first five reasons could also cause account shutdowns at other banks, so everyone should be careful when using their cards. For a more detailed analysis of these behaviors, see:

The last four reasons are more specific to AMEX. The logic is not hard to understand. If the balance on your statements stays very high, the bank will naturally think you may not be able to pay it back. And although authorized users are the ones holding the cards, you are still the person responsible for payment, so if you have many authorized users, AMEX needs to evaluate whether you have enough financial backing. If a business credit card gets hit with FR, you will need to provide business tax returns; otherwise, the chances of account shutdown are high, so weigh carefully whether you want to get into business cards. As for the same-address or authorized-user reason, my guess is that AMEX sometimes extends FR to the entire household.

The Financial Review Process

There are many possible triggers for FR, but the process is basically the same. In summary:

  • You receive a phone call on your cell phone from Unknown: If you do not answer, nothing will happen immediately. But they will keep calling later that day or the next day.
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  • An FR specialist confirms your personal information and informs you about the FR: Once the call connects, you will first be asked some questions, including identity verification, certain transactions on your cards, current income, and so on. After that, you will generally be told that you are under FR, that all your credit cards will be temporarily unusable, and that you will receive a detailed email about the FR process. The main content is about 4065T; through this form, AMEX can obtain the income you reported on last year’s tax return and review you based on that income.
  • All AMEX cards show as Charging suspended and can no longer be used: Both your own primary cards and your authorized user cards held by others will stop working. If you call the number, you will automatically be routed to the FR department.
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  • You receive the FR-related email mentioned by the FR specialist: You need to follow the instructions carefully, download the forms, fill them out, and fax them in. If you have questions, you can contact the FR specialist using the extension in the email, although calls usually go to voicemail, so just leave a message and wait for them to call back.
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  • Fill out the required cover sheet and 4506T: The cover sheet is simple and mainly asks for personal information, your fax number, and so on. There are two items in Form 4506T that need attention. For Transcript requested, enter the type of return you filed last year, such as 1040; you generally do not need to specify whether it was NR-EZ or something else, though doing so may be fine. For Year or period requested, enter the last day of the tax year requested. For example, if they want your 2015 tax return, enter 12/31/2015. Most importantly, you must hand-sign your own name at the end of the form.
  • Fax both forms to the number specified by AMEX: You can go to a physical store such as office max to send a fax, or use an online fax service. Personally, after filling out the forms, I scanned them into PDF files and used the online fax service Hello Fax to send them to AMEX. To get a Hello Fax fax number, you can send a sample and then view the details to find it there (the cover sheet needs to be filled out).
  • Call the specialist to confirm whether the fax was received: Everyone should really do this, because sometimes the fax does not go through or the received copy is unclear. In that case, if they cannot reach you and the FR deadline passes, your account may be shut down directly. So try to call the specialist, confirm the fax status, and if no one answers, leave a message asking them to call you back.
  • Wait for the result, usually about 5-15 business days: After AMEX uses your 4506T to obtain your income information from the IRS, the FR specialist will enter that information into the system, and the computer will automatically generate the outcome. From the time your fax is successfully sent to the final result, it usually takes about 5-15 business days.
  • Result notification: You will receive a call from Unknown informing you of the result; if you miss the call, you will receive an email with the outcome. Usually there are three possibilities: 1. You pass FR directly and nothing happens. 2. Your charge cards get a spending limit and your credit card limits are reduced. 3. You fail FR and your cards are shut down directly.

How to Respond to a Financial Review

After You’ve Been Put Under Financial Review

If you are unlucky enough to get hit with it, the first thing you should do is honestly assess your income situation. If you were AMEX, would you shut down this high-risk user’s cards? Here are a few suggestions from me:

  • Be truthful about the income shown on your tax return when speaking with the specialist: Since Form 4506-T authorizes the IRS to send your tax return to AMEX, there is really nothing to hide. If you exaggerate your income at this point, it could easily backfire.
  • Submit your tax documents as requested and do not miss the deadline: Even if you are not confident about your income, do not delay and hope for the best. Just send the 4506-T to AMEX as instructed. The final result may simply be a lower credit limit on your existing cards.
  • Emphasize your bank deposit information when talking with the specialist: If you did not file taxes last year, or you are not very confident about the income shown on your IRS forms, it is best to point out your deposits and any non-tax-return sources of income, such as living expenses provided by family. If you did not file taxes, AMEX will generally ask you to fax bank statements and will determine the FR outcome based on your deposits. If you did file taxes, this usually does not help much and only serves as supplemental information.
  • Maintain a good attitude when dealing with the specialist: Although the FR result ultimately depends on the numbers, if they already have concerns about you, it is still best to stay polite and cooperative.
  • Have family members at the same address use their cards carefully: Sometimes AMEX extends an FR to family members at the same address or to authorized users, so during the FR period, it is best for them to keep a low profile, reduce large purchases on AMEX cards, and try to pay off their Balance.
  • Pay off all Balance on your cards, lower limits, and close some unused cards: This may not necessarily help, but all of these actions can reduce your risk profile with AMEX.
  • Transfer out your Membership Rewards points and cash out cashback: If you are not very confident about your outcome, or you want to reduce the loss if your cards are shut down, you can go online and transfer out all Membership Rewards points and redeem all cashback as Statement Credit. Even though you may not be able to continue using your cards, both of these actions should still work normally.

How to Avoid Financial Review

Even if your income fully supports your spending, getting hit with an FR is still a hassle. After all, you may be unable to use your cards for about two weeks, and missing an AMEX Offer or the deadline for meeting a welcome bonus spending requirement would be unfortunate. Here are a few suggestions:

  • Do not apply for several AMEX cards within a short period and then quickly meet the minimum spending requirements: Try to spread your spending evenly over three months; start slow.
  • Reduce regular large purchases, such as buying Visa gift cards: If you are not confident about passing FR, it is probably better not to use an AMEX card just to earn that 5%. You can stick to making money from AMEX Offer deals and welcome bonuses instead.
  • Try not to carry too much Balance, especially on Charge cards. Also reduce the number of authorized users.
  • Before earning the welcome bonus, reduce other high-risk behavior on your AMEX cards

Recently, reader daxihe noticed that AMEX credit card applications now include a field for non-taxable annual income. Considering that AMEX FR requires checking tax returns, this field may give FR specialists more flexibility. It may become possible in the future to explain that your family provides money and then legitimately use bank statements to pass FR. However, that is only my personal speculation.

My Financial Review Experience

It is a bit awkward, honestly. I have written so many articles here about credit card company risk control, yet in the end I still could not escape the grip of FR myself. Let me share why I was subjected to FR. The main reason was that I put more than $3,500 of supermarket spending on the AMEX Blue Cash Preferred within two months, most of it on Visa gift cards, despite having had very little prior spending on that card. My AMEX Mercedes-Benz card also had two large gift card purchases. When the FR specialist called, he specifically asked about those transactions. I answered that I bought the gift cards for friends, and he did not press further.

Here is my background before the FR:

Here is my time line:

  • 8/16/2016: Received the AMEX FR call and faxed the required documents the same day
  • 8/17/2016: Left a voicemail for the FR specialist to confirm whether the documents had been received
  • 8/18/2016: Through online chat, I closed a Platinum card from the previous year and lowered the AMEX SPG limit from 11,000 to 2,000
  • 8/20/1016: The FR specialist returned my message and said they had already requested last year's tax return from the IRS
  • 8/23/2016: That evening, when I checked my AMEX Charge cards, I found that the limit had increased, but charging was still suspended. I secretly celebrated, thinking the FR had already passed
  • 8/24/2016: Received an email from AMEX saying the FR had been passed. The Charge card limit was increased, while the credit card limits remained unchanged.