Koss Corp. sued American Express to recover some of...

Sachdeva, remains free on $50,000 bond awaiting trial on the charges. She has pleaded not guilty. The allegations against Sachdeva came to light just before Christmas, when American Express investigators alerted Koss that the balances on Sachdeva’s personal credit-card accounts were being paid down through “numerous large wire transfers” from Koss bank accounts in Chicago and Milwaukee, court documents said. But in its complaint alleging the aiding and abetting of fraud, Koss says AmEx “did little to no investigation into the improper transactions.” AmEx repeatedly “approved these fraudulent payments so that Sachdeva, who had grown to be one of AMEX’s premier customers, could continue to use her American Express charge cards at a rate of approximately $1,000,000 a month, thus enriching Defendant AMEX at the expense of Koss,” the complaint says. Koss has not responded to our inquiries about how such large unauthorized transactions could have taken place undiscovered so long. AmEx has moved to have the suit dismissed, saying Koss, “a publicly traded company with internal accounting controls and outside auditors, incredibly never discovered this massive fraud on its own.” If not for AmEx, “Sachdeva’s fraud might have continued indefinitely,” it told the court. “But instead of thanking American Express for helping to end Sachdeva’s criminal activity, Koss filed this lawsuit.” The companies disagree about where the lawsuit should be tried. Koss originally filed the complaint in an Arizona state court and wants the case remanded there. AmEx won removal of the case to the U.S. District Court in Phoenix and wants to keep it there.