Investigation and a pending class action lawsuit brought on behalf of all merchants who accepted Visa and/or MasterCard credit or signature debit cards since January of 2004.
Those merchants have paid artificially-inflated merchant discount fees to their acquiring banks, either directly or through third-party processors. In many instances, those fees are bundled with other fees on merchants' invoices, and not explicitly referenced. Visa, MasterCard and several large banks who have played substantial roles in operating those networks are defendants in the case. However, the class includes all merchants who have accepted the above-referenced cards during the relevant period, without regard to whether they have dealt directly with any of the defendants.
The class action lawsuit alleges that defendants have illegally fixed the interchange fee, which comprises the majority of (and serves as a floor for) the merchant discount fee. Acquiring banks agree to pay interchange fees to the card issuer's bank pursuant to every credit or signature debit card transaction using a Visa or MasterCard payment card.
During the relevant period, Visa and MasterCard fixed interchange fees via their respective boards of directors, which were comprised primarily of representatives of their member banks. Visa and MasterCard have effectively precluded merchants from avoiding interchange fees through a series of restrictive rules, which bind all Visa and MasterCard member banks, as well as all merchants who accept Visa and MasterCard payment cards.
This class action lawsuit seeks monetary damages, as well as injunctive relief precluding the networks' enforcement of certain restrictive rules.
Name (Stock Symbol)
Visa, Inc. (V)
Visa, Inc., through its subsidiaries, operates retail electronic payments network worldwide.
Mastercard Inc. (MA)
MasterCard Incorporated, together with its subsidiaries, provides transaction processing and related services to customers principally in support of their credit, deposit access, electronic cash and automated teller machine payment card programs, and travelers cheque programs.
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