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Third ATM Fee Price-Fixing Class Action Lawsuit Filed
By Kimberly Mirando
A third class action lawsuit over collusion of ATM fees accuses three major banks and two payment processors of conspiring to fix fees at the expense of consumers.
The latest ATM fee class action lawsuit, filed in New Jersey, alleges Bank of America, JPMorgan Chase and Wells Fargo conspired with Visa and MasterCard to fix the prices consumers pay when they use an ATM that’s in their bank’s network. It alleges “unlawful agreements” among the banks and payment networks result in inflated fees when consumers use an out-of-network ATM owned by an independent operator, such as those located at convenience stores, restaurants and other businesses.
A similar ATM fee price fixing lawsuit was filed last week against MasterCard and Visa on behalf of individuals in California and Washington, D.C., which followed on the heels of a class action lawsuit filed by operators of independent ATMs with similar claims.
“At the heart of all three lawsuits are the complex, behind-the-scenes negotiations between card issuers and their payment processors,” writes the Associated Press, which does a great job of explaining what the ATM fee price-fixing class action lawsuits are targeting.
According to the AP:
“Most consumers know MasterCard and Visa merely as the logos on their credit and debit cards, but the companies play pivotal roles in the payments universe because they provide the networks that process card transactions. Think of them as the operators of phone lines or wireless networks.
“There are smaller payment processors for debit card transactions, such as Star, Nyce and Pulse, which is owned by Discover Financial Services. But MasterCard and Visa are the arena’s predominant players.
“Even if a card bears a MasterCard or Visa logo, debit cards are equipped to function on more than one payment network. In turn, ATM operators typically tap into the cheapest network available to them to complete a transaction.
“The problem, according to the independent ATM operators’ lawsuit, is that MasterCard and Visa force ATM operators to charge consumers the same out-of-network fee all the time, even when their cards can access the cheaper networks. That prevents independent operators from offering discounted fees, which they say would increase business from the consumers who now go elsewhere to make withdrawals to avoid steep out-of-network fees.”
All three ATM fee antitrust lawsuits were filed in U.S. District Court in the District of Columbia and do not seek specific monetary damages.
Updated October 25th, 2011
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One thought on Third ATM Fee Price-Fixing Class Action Lawsuit Filed
I can’t believe there are so many law suits, for so many differant things Diana