Major American Banks, Visa, and Mastercard Accused of Price Fixing
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A New Jersey man has filed a lawsuit against the Bank of America, JPMorgan Chase and Wells Fargo for colluding with Visa and Mastercard in a “conspiracy to fix the prices” that ATM users pay when they withdraw cash from a machine not within their bank’s network.
A New Jersey man has filed a lawsuit against the Bank of America, JPMorgan Chase and Wells Fargo for colluding with Visa and Mastercard in a “conspiracy to fix the prices” that ATM users pay when they withdraw cash from a machine not within their bank’s network.
The lawsuit, which is currently seeking class-action status, is the third such lawsuit that has been filed in Washington this month. According to BusinessWeek, the suit was filed on behalf of consumers who “have been forced to pay artificially inflated, supra-competitive ATM access fees,” as stated in the filing.
[quote]”The violation in this case is a horizontal agreement among every bank that is a member of the Visa and/or MasterCard networks that charges ATM access fees on foreign ATM transactions,” the complaint alleged.[/quote]Two earlier lawsuits, one filed on Tuesday and the other on October 12th, accused both Visa and MasterCard of antitrust violations for restricting independent ATM operators from charging varying, lower prices for customers using alternative networks.
While representatives for the three banks and Visa declined to comment on the recent spate of lawsuits, a representative for MasterCard Inc. said in an emailed statement to the Associated Press that the lawsuit was “without merit” and that the company was ready to fight any allegations.
The MasterCard representative added that all of the company’s policies were “put in place to protect consumers from ATM operators seeking to impose discriminatory surcharges on our cardholders.”
The complainant though would beg to differ. In his lawsuit, the complainant alleged that ““By collusively agreeing to set a price floor for all ATM access fees at every ATM terminal throughout the country, the bank defendants and the bank co-conspirators shelter themselves from natural and beneficial price competition that otherwise would exist in the market.”
Furthermore, the long history between Visa, Mastercard and the banks – the two payment networks were originally formed by bank associations – also pointed to a possible collaboration between the accused parties.
[quote]“MasterCard and Visa are the banks’ alter egos,” said Jonathan Rubin, of Rubin PLLC.[/quote]
