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A class action alleging unfair and misleading billing practices has been filed against American Express on behalf of its Optima credit card customers. The suit, still in the preliminary stages, alleges that when customers return items charged on their Optima card, the company deducts the purchase from the balance charged at a lower interest rate rather than the balance at the higher rate, thereby charging customers more because of the difference in the interest rates. Card members pay two interest rates for their debt balances — 3.9 percent for balance transfers from other credit cards and 14.99 percent for regular purchases. The suit alleges that when Roger M. Lindmark, a Los Angeles attorney who is the name plaintiff for the class, returned an $866 business office machine charged on his card, the company credited it to the lower-interest balance transfer category, not the regular purchase category. Thus, Lindmark, and presumably other Optima card members, paid additional interest of about 11 percent, despite being fully credited for the purchase. The complaint also asserts that American Express improperly inflates the cardholders’ average daily balance by accruing interest each day on outstanding debt balances. The papers say that the monthly interest charges are increased by these allegedly inflated daily balances, and that both figures increase the finance charges. Andrew Hutton, a partner at Milberg Weiss Bershad Hynes & Lerach in Los Angeles, represents Lindmark and the class. He declined to put a figure on the amount of relief being sought, but he estimates that as of 1998 there were 7 million Optima cardholders, who had average balances of about $1,300. Hutton, a certified public accountant, said that he is looking into other cases but declined to name which credit card companies they concerned. American Express’ answer is due in October. Attorney Julia Strickland, a partner at Stroock & Stroock & Lavan in Los Angeles, referred questions about the suit to an American Express public relations representative, who declined comment.

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