The Bank of Italy has forced American Express
(Amex) to halt the issuance of new credit cards from Monday,
following an inspection.

According to a Bank of Italy source, Amex
failed to meet the Italian legal requirements with regards to
usury, money-laundering and transparency. There was a concern that
supplementary cards were being issued without sufficient checks to
ensure they weren’t being used by front men for money laundering
operations.

David Parker, CEO of Polymath Consulting, said
the punishment amounted to little more than a slap on the wrist for
Amex.

“Diners Club International faced similar
challenges with the central bank in 2009,” he said.

” I would expect American Express to quickly
get their house in order and make the relevant changes.”

In a statement public affairs manager for
AMEX, Joanna Lambert said: “As a result of the inspection, the
company is currently implementing an upgrade of its information
technology systems and other procedures, in order to adhere more
closely to the regulations applicable to payments service providers
and financial intermediaries.”

“We will temporarily suspend issuance of new
cards from April 12th and will resume card issuance as soon as
these upgrades are completed, as established by the Bank of Italy,”
she added.

The suspension of card issuance has no impact
on existing AMEX card members who can continue to use their cards
as usual.