Apr.08, 2010, Source: Associated Press

ROME — Italy's central bank on Thursday ordered a stop to the issuance of new credit cards by American Express in the country until the company can improve compliance with laws combatting money laundering and usury.

The Bank of Italy said there was concern that supplementary cards were being issued without sufficient checks to ensure they weren't being used buy front men for money laundering operations.

It also said there was concern that the way interest rates are calculated could violate anti-usury laws.

The central bank's action doesn't apply to existing cards. It said it took similar action against Diners Club' card issuance in Italy last year.

"American Express acknowledges it has received a report following an inspection from the Bank of Italy," American Express spokeswoman Joanna Lambert said in an e-mail to The Associated Press.

"As a result, American Express Italy 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," she said.

Lambert also said that "American Express Italy 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.

"American Express Italy has already begun to address the issues raised in the report, and is cooperating fully with the Bank of Italy in an effort to resolve the matter," she said. "This suspension does not affect American Express' existing Cardmembers, who can continue to use their cards as usual."

Lambert said she couldn't provide further details because "the report is confidential under Italian law."