The U.S. Department of Justice (DOJ) is suing payments giant Visa for allegedly maintaining an illegal market monopoly to keep smaller competitors in check.
In a press release, the DOJ says it’s filing a civil antitrust lawsuit against Visa, accusing the payments firm of illegally maintaining dominance over the debit network markets.
Antitrust laws were established to shield consumers from predatory business behaviors by limiting the market influence of any firm.
According to the DOJ, Visa’s monopoly over the debit network markets is smothering competitors and thwarting efforts toward developing new and innovative technologies.
The DOJ also alleges that Visa’s success in insulating itself from competition is allowing the firm to control more than half of debit card transactions in the US.
“According to the complaint, more than 60% of debit transactions in the United States run on Visa’s debit network, allowing it to charge over $7 billion in fees each year for processing those transactions…
Merchants and banks pass along those costs to consumers, either by raising prices or reducing quality or service. As a result, Visa’s unlawful conduct affects not just the price of one thing – but the price of nearly everything.”
The Justice Department also accuses Visa of anti-competitive conduct that slaps enormous costs on consumers, merchants and the US economy.
“Visa’s systematic efforts to limit competition for debit transactions have resulted in billions of dollars in additional fees imposed on American consumers and businesses and slowed innovation in the debit payments ecosystem. Through this lawsuit, the Justice Department seeks to restore competition to this vital market on behalf of the American public.”
Visa’s general counsel, Julie Rottenberg, reportedly says the lawsuit has no merit and that the company will aggressively defend itself in court.
“When businesses and consumers choose Visa, it is because of our secure and reliable network, world-class fraud protection, and the value we provide.”
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Henry Kanapi
https://dailyhodl.com/2024/09/29/7000000000-in-fees-drained-from-customers-and-businesses-every-year-by-visa-in-alleged-monetary-monopoly-us-department-of-justice/
2024-09-29 16:44:15
