Is Visa Making Up Compensation, Fine Calculations? Court Filings Raise Questions
Written by Frank HayesJanuary 12th, 2012
No retailer likes being fined by Visa or MasterCard for letting thieves steal payment-card data, and most grumble privately about how that process is arbitrary and rigged against merchants. But a lawsuit now unfolding in Utah has uncovered a remarkable level of detail about how arbitrary card brands can be.
The lawsuit is challenging everything from issuing banks' contracts to Visa's claims for counting up card fraud and pinpointing who's to blame—in addition to $1.3 million in card fraud that Visa says the restaurant enabled via an alleged security breach for which there's no concrete evidence.
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2 Comments | Read Is Visa Making Up Compensation, Fine Calculations? Court Filings Raise Questions
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-Thad Peterson
January 18th, 2012 at 6:41 pm
We now know what happens, although many of us predicted it before the debit interchange saga took place, when there is a fall in the issuers’ interchange revenues. That shortfall will be offset in one way or another, so that when it’s all said and done, the banks will have managed to get their overall revenues to pre-reform levels and it will be the consumer who will end up paying the bill. Only this time that bill would be much bigger, as banks’ losses from a potential credit interchange cut would be several times as large.
January 21st, 2012 at 11:33 am
Jay, the incidents in this case unfolded over a period from 2000 – 2008, long before Dodd-Frank and the Durbin Amendment legislation.