Court ruling or official DOJ announcement

DOJ Files Antitrust Lawsuit Against Visa for Monopolizing Debit Card Market, Stock Falls Nearly 5%

Sep 24, 2024, 07:38 PM

The U.S. Department of Justice (DOJ) has filed an antitrust lawsuit against Visa, alleging that the company has illegally monopolized the U.S. debit card market. The lawsuit claims that Visa has used its dominant position to shut out rival payment processors, penalize merchants and banks that do not use its payment processing technology, and extract excessive fees from businesses and consumers. The DOJ's complaint follows a multi-year investigation into Visa's business practices. Visa's U.S. debit volume is significantly higher than its closest competitor, Mastercard, with $984bn vs. $370bn as of April-June 2024. The news of the lawsuit has caused Visa's stock to fall by nearly 5%, including a 3% drop on Sept. 24. Prominent politicians, including Nancy Pelosi, sold significant amounts of Visa stock prior to the lawsuit announcement, raising questions about potential insider trading. Attorney General Merrick B. Garland stated that Visa has unlawfully amassed the power to extract fees that far exceed what it could charge in a competitive market. The DOJ also alleges that Visa offered incentives worth hundreds of millions of dollars annually to potential competitors under the condition that they do not develop competing products.