Visa Sued for Illegal Debit Market Monopoly

Justice Department taking action against financial market giant

One of the largest players in U.S. and global financial markets is facing legal action from the U.S. Department of Justice.

Visa, a global credit and debit network provider, is alleged to have created an illegal monopoly that stymies competition and drives up costs to consumers.

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.

The Department of Justice alleges that Visa uses a series of exclusionary agreements to penalize customers who route transactions to a different debit network or alternative payment system. This both crowds out smaller, cheaper competitors and drives up costs for consumers.

“We allege that Visa has unlawfully amassed the power to extract fees that far exceed what it could charge in a competitive market,” said Attorney General Merrick B. Garland. “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.”

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