Monday, January 23, 2006

Banks want merchants to be silenced and pretend that U.S. laws are not being violated

Reuters released a detailed article on Jan 23rd about the credit card interchange litigation and how it may lead to "more than $100 billion in damages."

After reading the article, it was interesting to observe that the banks continue to be silent about arguing the law, explaining why their collusive practices are not in violation of the Sherman Antitrust Act, and why the alleged price-fixing is not illegal. Instead, they get groups like The International Card and Payment Council to explain to Reuters that "a merchant victory would reverberate disastrously." A consultant to Citibank articulated an even weaker solution: he wants the Federal Reserve to simply have the court dismiss the litigation or tender another way to resolve this without being "disruptive to the banking system and the U.S. economy.''

Ok. But, what about the banks illegal activities. What about the facts?

There is near silence even though Visa tries to protect itself from future litigation by adding independent members to its board. Even MasterCard is trying to insulate itself from future litigation by mortgaging its liabilities onto the public through an IPO. [We still think the MasterCard IPO will be delayed and eventually cancelled]. With all this gamesmanship, can Susan Molinari and her advocacy group which, remember: "enjoys the financial support from Visa USA" be far behind?

Whatever vocal weaponry they prepare to hurtle at us, The Credit Card Interchange Report - is prepared to deflect every trick they launch against their customers (merchants and consumers). Using this forum, we are responding instantly and repeating the facts over and over again.

Click here to view a link to the Reuters article.