Wal-Mart Sues Visa For $5 Billion For Rigging Card Swipe Fees 455
Hugh Pickens DOT Com writes: "Reuters reports that Wal-Mart has sued Visa for $5 billion, accusing the credit and debit card network of excessively high card swipe fees. Wal-mart is seeking damages from price fixing and other antitrust violations that it claims took place between January 1, 2004 and November 27, 2012. In its lawsuit, Wal-Mart contends that Visa, in concert with banks, sought to prevent retailers from protecting themselves against those swipe fees, eventually hurting sales. 'The anticompetitive conduct of Visa and the banks forced Wal-Mart to raise retail prices paid by its customers and/or reduce retail services provided to its customers as a means of offsetting some of the artificially inflated interchange fees,' says Wal-Mart in court documents. 'As a result, Wal-Mart's retail sales were below what they would have been otherwise.' Interchange fees, the industry term for card-swipe fees, have been a major point of contention between retailers and banks. The fees are set by Visa and other card networks and collected by card-issuing banks like J.P. Morgan Chase & Co. Retailers have argued that the fees had been set too high due to a lack of competition with the two payment industry giants.
Wal-Mart also took a shot against Visa over payment card security. Data breaches last year at Target Corp., Neiman Marcus and others have drawn attention to the country's slow adoption of card technology that uses computer chips and PIN numbers and is seen as less susceptible to fraud than the current system of magnetic stripes. 'Wal-Mart was further harmed by anti-innovation conduct on the part of Visa and the banks,' says the lawsuit, 'such as perpetuating the use of fraud-prone magnetic stripe system in the U.S. and the continued use of signature authentication despite knowledge that PIN authentication is more secure, a fact Visa has acknowledged repeatedly.'"
Wal-Mart also took a shot against Visa over payment card security. Data breaches last year at Target Corp., Neiman Marcus and others have drawn attention to the country's slow adoption of card technology that uses computer chips and PIN numbers and is seen as less susceptible to fraud than the current system of magnetic stripes. 'Wal-Mart was further harmed by anti-innovation conduct on the part of Visa and the banks,' says the lawsuit, 'such as perpetuating the use of fraud-prone magnetic stripe system in the U.S. and the continued use of signature authentication despite knowledge that PIN authentication is more secure, a fact Visa has acknowledged repeatedly.'"
Walmart employees, rejoice! (Score:5, Funny)
Clash of the Titans (Score:5, Funny)
When one huge evil corporation attacks on another huge evil corporation for being evil, does it cause a rip in space time?
Re:Clash of the Titans (Score:5, Funny)
I don't know about a rip in space time, but walmart's popcorn sales should go up.
Wal-Mart vs. Visa (Score:5, Funny)
Is there any way they can both lose?
This is new economy (Score:5, Funny)
Since the middle class has been decimated, this is how business of the future will run... now that they've fleeced the rest of us, big companies will sue other big companies and that's their ticket to profitability and stock price rises.
Re: Customers may benefit... maybe (Score:3, Funny)
We need to move forward. It does not matter if the move is good or not we just need to progress forward, for the children and the environment. You do care about the children and the environment, and the puppies. Do not kill the puppies!
Re:PINs (Score:5, Funny)
Surely US citizens are not less intelligent then the rest of the world's citizens on average...?
Have you seen our reality shows?