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The DOJ filed a lawsuit accusing Visa of monopolizing debit card transactions and suppressing competition through high fees and agreements with potential rivals, Reuters reports. Visa processes 60% of all debit card transactions in the U.S., earning $7 billion annually from fees, according to the DOJ. Prosecutors allege Visa's agreements with card issuers and merchants, along with lucrative deals with companies like Apple and PayPal, helped preserve its market dominance. Following the lawsuit, Visa's shares dropped by 5.5%, while Visa's general counsel, Julie Rottenberg, dismissed the claims as meritless. The lawsuit is part of the Biden administration's larger efforts to address rising consumer prices, especially in light of the upcoming presidential election. Attorney General Merrick Garland noted that Visa’s conduct affects the prices of most goods, as merchants pass fees to consumers. The lawsuit claims Visa struck deals with companies like Apple and PayPal to prevent products that would challenge its dominance from being released. The DOJ seeks a court order to prevent Visa from imposing pricing structures that hinder competition and from paying competitors not to compete. This is not Visa’s first antitrust issue; the DOJ began investigating Visa in 2021 and blocked its acquisition of fintech company Plaid. Visa and Mastercard have previously settled antitrust cases, including a $5.6 billion settlement with U.S. merchants in 2019 over similar claims.
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