Pace of Wells Fargo trial is testing judicial patience | StarTribune.com

At issue is whether Wells Fargo took unusual risk in an investment portfolio in which clients took short-term positions to gain pennies or fractions of a penny on the dollar on collateral for securities they loaned to a broker.

via Pace of Wells Fargo trial is testing judicial patience | StarTribune.com.

Visa cuts debit card fees in Europe; raises them in U.S. | Newsnet 14

Despite a recent study that found swipe fees are stalling the creation of nearly a quarter million U.S. jobs, Visa raised its debit card interchange rate for American retailers to .95 percent plus $.20 per transaction in April, according to the Retail Industry Leaders Association. In contrast, Visa Europe announced Monday that it would be capping transaction fees at 0.2 percent for the next four years

via Visa cuts debit card fees in Europe; raises them in U.S. | Newsnet 14.

Both Credit And Debit Rise for Visa, Along with Acquirer Fees

San Francisco-based Visa instituted an acquirer price increase last year (Digital Transactions News, March 17, 2009). In a conference call with analysts, Visa chief financial officer Byron H. Pollitt Jr. attributed the data-processing revenue growth to VisaNet’s 14% transaction increase and “the continuing effect of previously enacted pricing actions,” according to the Seeking Alpha transcript service.

It looks like another “pricing action” is on the way. Referring to an April price increase by MasterCard Inc., an analyst asked Visa executives if “you have raised merchant assessment pricing as well?” According to Seeking Alpha, chief executive Joseph W. Saunders responded, “Well, we’ve already announced an increase in our acquirers fees similar to the one that MasterCard did and ours is effective in July.” A Visa spokesperson declined further comment. As they do with interchange, acquirers are likely to pass on such network fee increases to their merchant clients.

via Digital Transactions: Both Credit And Debit Rise for Visa, Along with Acquirer Fees

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MasterCard is charging ahead with a new web shopping mall featuring 28,000 retailers | InternetRetailer.com

MasterCard Worldwide is inviting its cardholders to a massive new online destination, and getting personal in a big way. The payment card network last month launched the MasterCard MarketPlace, an online mall with more than 28,000 merchants. It is collaborating on the project with Next Jump, an Internet company that specializes in personalized shopping.

via MasterCard is charging ahead with a new web shopping mall featuring 28,000 retailers | InternetRetailer.com.

Thousands Swarm To Massive Protest On Wall Street (PHOTOS)

“Bust up big banks! Shame on you!” chanted protesters in bank building lobbies in midtown Manhattan this afternoon as Wall Street staffers carrying lunch back to their trading desks hustled by.

via Thousands Swarm To Massive Protest On Wall Street (PHOTOS).

The Associated Press: Protesters enter NYC bank buildings before rally

NEW YORK — Noisy protesters with signs took over two bank building lobbies on Thursday in a prelude to a Wall Street rally by workers and union leaders angry over lost jobs, the taxpayer-funded bailout of financial institutions and questionable lending practices by big banks.

via The Associated Press: Protesters enter NYC bank buildings before rally.

Visa Cuts Swipe Fees In Europe, Raises Them In America – Yahoo! News

Despite a recent study that found swipe fees are stalling the creation of nearly a quarter million U.S. jobs, Visa raised its debit card interchange rate for American retailers to .95 percent plus $.20 per transaction in April, according to the Retail Industry Leaders Association. In contrast, Visa Europe announced Monday that it would be capping transaction fees at 0.2 percent for the next four years.

A spokesperson for Visa, Inc. said the average Visa Debit transaction fee rose by less than 4 percent.

“Most of Visa’s U.S. debit rates have not changed,” she said. “Visa, Inc., did recently make a variety of program and interchange modifications to make digital currency even more convenient for consumers and merchants and to facilitate continued growth for Visa and its clients.”

via Visa Cuts Swipe Fees In Europe, Raises Them In America – Yahoo! News.

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European Interchange Fees: A Done Deal? (Via NACSOnline)

LONDON, ENGLAND – Despite news earlier this week that Visa Europe has offered to reduce interchange fees on debit cards, a Retail Week column challenged whether the announcement will convince the European Commission to end its antitrust proceedings.

Earlier this week, Visa Europe announced a plan to test market reducing interchange fees by 60% for domestic transactions and 30% for cross-border fees, a move welcomed by European Competition Commissioner Joaquin Almunia. However, Retail Week urged retailers to restrain their optimism and to be skeptical of an imminent final resolution.

Among Retail Week’s arguments for this cautious approach is Visa’s non-mention of addressing credit card fees. Additionally, MasterCard has already been down a similar process with the EC, only to drop the plan after a subsequent move to raise membership fees that banks had to pay generated stiff protest from retailers.

The European Commission said that if the proposal is successfully market-tested, it will be made legally binding, and that it will no longer pursue antitrust investigation into Visa Europe debit card fees. Retail Week said that Visa’s omission of its credit card fees still presents retailers with significant financial challenges, making the issue far from resolved.

via European Interchange Fees: A Done Deal?.

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Visa Beats Expectations; Raises Revenue Forecast – ABC News

NEW YORK (Reuters) – Visa Inc reported a 33 percent increase in second quarter earnings, better than Wall Street expected, as consumer spending rebounded and management said it was increasingly optimistic about the economy.

via Visa Beats Expectations; Raises Revenue Forecast – ABC News.

Conyers Calls for Reduction in Credit-Card Fees | CSP Daily News / Magazine | CSP Information Group, Inc.

WASHINGTON — House Judiciary Committee Chairman John Conyers Jr. (D-Mich.) issued the following statement regarding today’s Judiciary Committee hearing on H.R. 2695, the Credit Card Fair Fee Act:

“The purpose of today’s hearing is to examine H.R. 2695, the “Credit Card Fair Fee Act of 2009.

via Conyers Calls for Reduction in Credit-Card Fees | CSP Daily News / Magazine | CSP Information Group, Inc..

Visa, Inc. F2Q10 (Quarter End 03/31/10) Earnings Call Transcript — Seeking Alpha

Welcome to Visa Inc.’s fiscal second quarter 2010 earnings conference call. With us today are Joe Saunders, Visa’s Chairman and Chief Executive Officer and Byron Pollitt, Visa’s Chief Financial Officer. This call is currently being webcast over the Internet. It can be accessed on the Investor Relations section of our website at http://www.InvestorVisa.com.

A replay of the webcast will also be archived on our site for 30 days. A PowerPoint deck containing highlights of today’s commentary was posted to our website prior to this call. Let me also remind you that this presentation may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995

via Visa, Inc. F2Q10 (Quarter End 03/31/10) Earnings Call Transcript — Seeking Alpha.

Visa Inc. Posts Strong Fiscal Second Quarter 2010 Earnings Results – MarketWatch

[Via Visa Inc. corporate press release]

SAN FRANCISCO, April 28, 2010 /PRNewswire via COMTEX/ — Visa Inc. /quotes/comstock/13*!v/quotes/nls/v (V 92.19, -1.42, -1.52%) today announced financial results for the Company’s fiscal second quarter 2010 ended March 31, 2010. GAAP net income for the quarter was $713 million, or $0.96 per diluted class A common share. The weighted average number of diluted class A common shares outstanding was 742 million.

GAAP net operating revenue in the fiscal second quarter of 2010 was $2.0 billion, an increase of 19% over the prior year and driven by strong contributions across all revenue categories, in particular data processing and international transaction revenues.

via Visa Inc. Posts Strong Fiscal Second Quarter 2010 Earnings Results – MarketWatch.

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StreetInsider.com – Visa’s (V) Q2 Sales and Profit Charge Higher

“Our performance was fueled by higher than expected payments volume growth. As I discussed at our recent Investor Day, we are increasingly optimistic that economic growth will gradually improve,” said Joseph Saunders, Chairman and Chief Executive Officer of Visa Inc. “At the same time, we remain diligent about how we manage our business and finances throughout the current economic environment.”

via StreetInsider.com – Visa’s (V) Q2 Sales and Profit Charge Higher.

Visa Q2 Profit Jumps 33 Percent On Transaction Growth – American Banking News

Revenue rose in the period to $1.96 billion from $1.65 billion in the prior year. The results topped analyst estimate for earnings of 91 cents a share on revenue of $1.93 billion.

Increased usage of debit cards helped fuel revenue growth. Debit card transaction volume jumped 19 percent in the U.S. during the quarter, while foreign use rose 20 percent.

Credit card usage grew as well, but not nearly as robust as debit card growth. U.S. credit card transactions rose 1.5 percent, while foreign usage was much stronger, up 11 percent.

via Visa Q2 Profit Jumps 33 Percent On Transaction Growth – American Banking News.

Visa Q2 beats expectations; raises revenue forecast | Reuters

Visa also issued a slightly bolder forecast. It now expects annual net revenue growth at the high end of the 11 percent to 15 percent range it provided in February.

The company receives fees whenever consumers use one of its credit or debit cards. As consumers increasingly pay with plastic instead of cash or checks, the company’s revenue rises.

via UPDATE 3-Visa Q2 beats expectations; raises revenue forecast | Reuters.

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Debit card surcharge ban may get Senate hearing; House already approved

For more than two decades, Florida law has forbid merchants from passing on the fees they pay to allow for credit card use to customers. But there is no such rule for debit cards. A House bill (HB 621) which passed unanimously in that chamber last week, would add debit cards to the surcharge prohibition.

The Senate version (SB 1106) was stalled as merchants lobbied against the ban and credit card giant Visa lobbies for it. But late Wednesday, Senate sponsor Victor Crist, R-Tampa, said he planned to go ahead and amend his bill to match the House version that prohibits the surcharge. It may come up for a Senate vote Thursday .

via Debit card surcharge ban may get Senate hearing; House already approved.

NACS Delivers 2 Million Customer Signatures Urging Swipe Fee Reform — WASHINGTON, April 27 /PRNewswire/ —

WASHINGTON, April 27 /PRNewswire/ — Building on 7-Eleven’s successful “Stop Unfair Credit Card Fees” consumer petition campaign, convenience store operators today joined with U.S. Representatives Peter Welch (VT-At Large) and Bill Shuster (PA-9) to deliver an additional 2 million new customer signatures collected during the NACS “Stop Unfair Swipe Fees” campaign, which is asking Congress to put an end to unfair, hidden credit and debit card swipe fees that cripple Main Street merchants and their customers.

“Today two million Americans added their voices to the chorus calling for fairness for the small businesses that drive our economy. Two million more Americans are recognizing that swipe fees kill good-paying, local jobs and drive up costs for consumers. Two million more Americans are saying ‘enough is enough,'” said Rep. Welch. “We must take action to rein in the abusive practices of the credit card industry and ensure that small businesses get a fair deal.”

Combined with 7-Eleven’s 1.7 million signatures urging swipe fee reform, the total number of signatures delivered to Congress is 3.7 million — the largest number of consumer signatures ever collected for a public policy issue.

American consumers and merchants pay $48 billion each year in hidden credit and debit card fees — more than twice those charged in countries like the United Kingdom and Australia. In fact, just yesterday, Visa Europe agreed to slash some of the fees charged for debit card transactions in Europe, while debit rates in the U.S. have continued to climb.  

“Swipe fees cost Americans more than late fees, over-the-limit fees, annual fees, cash advance fees and ATM fees combined,” said Hank Armour, NACS president and CEO.  “Small businesses across the country are struggling to pay these huge fees. It’s bad enough that tough economic conditions are forcing many retailers to lay off employees or shut their doors because they cannot sustain growth, on top of paying unfair card fees that they cannot negotiate. Congress needs to take action and that action needs to come today.”  

Rep. Shuster, who has introduced legislation to reform swipe fees, agreed. “As a former small business owner, I know how hard it is to make a payroll, pay taxes and fees, and try to make a profit all at the same time,” Shuster said.  “For far too long, interchange fees have been an unnecessary impediment for businesses, and that needs to change.  It is my hope that Congress will consider the merits of our bill, as well as the serious struggle of business owners and consumers alike in their need for transparency, simplicity, and fairness when it comes to the issue of interchange fees.”

Retailers and their customers across the country are demanding that Congress create an everyday stimulus for Main Street by reining in unfair hidden swipe fees.  With this second round of petition signatures, consumers and merchants are saying “enough is enough” and wondering how many more millions of signatures Congress needs to see before it takes a stand.

“It’s pretty crazy to think that the credit card companies make more off of most small stores than the owners do, but that’s the case these days,” said NACS Chairman Jay Ricker, CEO of Ricker Oil Company.  “From coast to coast, convenience stores pay more in fees to the credit card companies than they make in profits each year.  Millions of Americans have signed these petitions and urged Congress to take action against unfair swipe fees. It’s time for Congress to step up to the plate and fix this broken system.”

“Swipe fee reform would provide an everyday economic stimulus that wouldn’t cost taxpayers a dime,” said Sonja Hubbard, CEO of E-Z Mart Stores. “Turning down a solution as simple and straight-forward as swipe fee reform is a slap in the face to the 3.7 million consumers who have stated very clearly that they care about this issue.”

Following today’s press conference, U.S. senators will receive the signature of each customer who signed the petition in their state.

Founded in 1961 as the National Association of Convenience Stores, NACS is the international association for convenience and petroleum retailing, representing more than 2,200 retail and 1,800 supplier member companies. The U.S. convenience store industry, with nearly 145,000 stores across the country, posted $624 billion in total sales in 2008, of which $450 billion was motor fuels sales.

SOURCE NACS

via NACS Delivers 2 Million Customer Signatures Urging Swipe Fee Reform — WASHINGTON, April 27 /PRNewswire/ —.

NACS Delivers 2 Million Customer Signatures Urging Swipe Fee Reform — WASHINGTON, April 27 /PRNewswire/ —

WASHINGTON, April 27 /PRNewswire/ — Building on 7-Eleven’s successful “Stop Unfair Credit Card Fees” consumer petition campaign, convenience store operators today joined with U.S. Representatives Peter Welch (VT-At Large) and Bill Shuster (PA-9) to deliver an additional 2 million new customer signatures collected during the NACS “Stop Unfair Swipe Fees” campaign, which is asking Congress to put an end to unfair, hidden credit and debit card swipe fees that cripple Main Street merchants and their customers.

“Today two million Americans added their voices to the chorus calling for fairness for the small businesses that drive our economy. Two million more Americans are recognizing that swipe fees kill good-paying, local jobs and drive up costs for consumers. Two million more Americans are saying ‘enough is enough,'” said Rep. Welch. “We must take action to rein in the abusive practices of the credit card industry and ensure that small businesses get a fair deal.”

Combined with 7-Eleven’s 1.7 million signatures urging swipe fee reform, the total number of signatures delivered to Congress is 3.7 million — the largest number of consumer signatures ever collected for a public policy issue.

via NACS Delivers 2 Million Customer Signatures Urging Swipe Fee Reform — WASHINGTON, April 27 /PRNewswire/ —.

Congress Breaks Its Silence on Interchange with a New Hearing

Via Digital Transactions

(April 28, 2010) After months of inactivity on interchange regulation, the U.S. House of Representatives judiciary committee on Wednesday held a hearing on one bill advocated by national merchant groups. And while the committee took no action, one merchant group views the hearing as a hopeful sign that legislation will be passed.

The committee heard testimony from proponents and opponents of the Credit Card Fair Fee Act of 2009, H.R. 2695, whose lead sponsor is House Judiciary Committee Chairman U.S. Rep. John Conyers, D-Mich. Two other interchange-regulation bills are now pending before Congress—the Credit Card Interchange Fees Act of 2009, sponsored by U.S. Rep. Peter Welch, D-Vt., also in the House, and the Credit Card Fair Fee Act, S. 1212, sponsored by U.S. Sen. Richard Durbin, D-Ill., in the Senate.

via Congress Breaks Its Silence on Interchange with a New Hearing

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Statement of the Electronic Payments Coalition on H.R. 2695 — WASHINGTON, April 28 /PRNewswire/ —

[Comment on Twitter (@WayTooHigh) by Mitch Goldstone: “Electronic Payments Coalition (H.R. 2695 http://bit.ly/byWjBv) didn’t mention anticompetitive price-fixing, 80% market power #SwipeFees“

———————————————————-

[Via Press release]

The Electronic Payments Coalition thanks the Judiciary Committee for the opportunity to present the facts in a hearing on H.R. 2695 – a bill that holds extraordinary potential for harming small financial institutions, competition in the debit, credit and charge card market, and ultimately the consumers served by this industry.

	Small financial institutions will typically offer debit and credit card products to their customers at or below margin – as a loyalty building and customer service tool.  Should interchange revenue be forced down, as proposed in this bill, these community banks and credit unions will face an impossible decision of raising rates, eliminating rewards programs, or stopping their card programs altogether.  Customers of credit unions and community banks will have fewer choices with reduced competition in the market.
	In Australia, where regulators forced down interchange rates below market value, this is precisely what happened.  Merchants saw hundreds of millions of dollars in increased revenue, with no evidence that consumers saw any savings at the register.  Moreover, consumers saw the return of annual fees on their cards, reduced or eliminated rewards programs, and a less competitive marketplace for debit and credit cards.
	Merchants receive guaranteed payment, increased profits, and reduced expenses when they accept cards.  But they do not want to pay for these benefits, and are attempting to shift this business expense onto their customers.  We urge Congress to oppose H.R. 2695, a bill that will reduce competition, harm small financial institutions, consumers, and our economic recovery.

About Electronic Payments Coalition

The Electronic Payments Coalition is dedicated to protecting consumer value, choice, and competition in electronic payments systems. The coalition is a broad-based group of payment card networks, financial services companies, and financial services trade associations whose primary goal is to educate policy-makers, consumers, and the media about the value of electronic payments systems — including economic growth, convenience, speed, reliability, and security — and to ensure the continued growth of global commerce by promoting consumer choice and the stability of the vast payment networks that connect millions of consumers with millions of retailers each and every day.

SOURCE Electronic Payments Coalition

via Statement of the Electronic Payments Coalition on H.R. 2695 — WASHINGTON, April 28 /PRNewswire/ —.

Visa hits back with ads in debit card fee debate – St. Petersburg Times

When you swipe your credit card at Publix, Home Depot or Walmart, state law says the retailer can’t charge you a transaction fee. Instead, the retailer has to pay it to the credit card company.

The decades-old state law, however, was passed before the rise of debit cards, which means a retailer could charge you a transaction fee if you use your debit card.

But most retailers don’t charge the fee, so the Florida Retail Federation initially said it supported Democratic Reps. Mary Brandenburg and Ari Porth’s House bill 621, which ensures that debit card users aren’t hit with fees.

via Visa hits back with ads in debit card fee debate – St. Petersburg Times.

CS/CS/CS/HB 621 – Credit and Debit Card Crimes Bill

Credit and Debit Card Crimes: Provides that seller or lessor is prohibited from imposing surcharge on debit card transactions; defines “debit card”; provides that provisions do not apply to offers of discount for purpose of inducing payment by cash, check, or other means not involving use of debit card; prohibits possession of stolen credit or debit card in specified circumstances; provides that retailer who takes, accepts, retains, or possesses stolen credit or debit card without knowledge that card is stolen & is authorized to process transactions by company issuing credit or debit card does not commit violation under certain circumstances; provides exception for certain retail employees.

via CS/CS/CS/HB 621 – Credit and Debit Card Crimes.

Visa Cuts Swipe Fees in Europe, Raises Them in American | CSP Daily News / Magazine | CSP Information Group, Inc.

Visa Cuts Swipe Fees in Europe, Raises Them in American

Europe gets 60% cut in debit card interchange fees; U.S. retailers see 30% increase

ARLINGTON, Va. — The announcement earlier this week that Visa Europe has reached a settlement with European Union regulators capping interchange fees on debit transactions paid by European retailers leaves American businesses, small and large, asking why the same cannot be done here, said the Retail Industry Leaders Association (RILA). It also likely foreshadows further Visa increases on the fees paid by American retailers unless Congress acts soon on debit interchange reform, the group added.

Interchange fees, which are imposed by the card association and issuing banks to process the credit and debit card transactions, have tripled in the United States since 2001 to $48 billion last year and amount to a hidden tax on consumers. These “swipe fees” are charged to every retailer, small or large, for every credit and debit transaction processed.

via Visa Cuts Swipe Fees in Europe, Raises Them in American | CSP Daily News / Magazine | CSP Information Group, Inc..

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Brazil Will Limit Fees Credit Cards Charge Consumers (Update1) – BusinessWeek

April 27 (Bloomberg) — Brazil’s government will limit the fees credit card companies can charge consumers, Justice Minister Luiz Paulo Barreto said.

The National Monetary Council, led by Finance Minister Guido Mantega, will be allowed to set rules on credit card fees under a proposal Barreto revealed to reporters today in Brasilia. Lawmakers will also be asked to give the council broader authority to regulate credit cards, he said.

via Brazil Will Limit Fees Credit Cards Charge Consumers (Update1) – BusinessWeek.

VISA prints ads in Tampa Trib, St. Pete Times to sway Sen. Victor Crist on debit card interchange fees | Tampa Bay, St. Petersburg, Clearwater, Sarasota | WTSP.com 10 Connects

TAMPA BAY, Florida – In a push to close a loophole that allows retailers to charge a surcharge for debit card transactions (they cannot for credit card transactions), VISA has taken out full-page ads in five newspapers – including the Tampa Tribune and the St. Pete Times – urging lawmakers to pass HB 621. The National Retail Federation has been fighting similar legislation across the country for decades.

HB 621 was designed to make credit card theft a felony, but the Florida Retail Federation is angry about the “swiping fee” ban amendment, added late to the house version of the bill.

Retailers oppose the bill so vehemently because they say it would give the credit card companies power to drastically raise the fees they charge retailers everytime they swipe a card.  Right now, some say the power to pass the cost to consumers is the only leverage they have in negotiations with the credit card companies.

“The debit card surcharge portion of the bill is the same misleading legislation Visa has been trying to push in several states,” Craig Shearman, National Retail Federation Vice President told 10 Connects.  “It has been signed into law in Maine and Oklahoma but rejected in Colorado and Louisiana but is still pending in Kansas, California and New York.

via VISA prints ads in Tampa Trib, St. Pete Times to sway Sen. Victor Crist on debit card interchange fees | Tampa Bay, St. Petersburg, Clearwater, Sarasota | WTSP.com 10 Connects.

Consumers Join Credit Card Interchange Fee Fight

As all things seemed lost for business owners in the fight against “interchange fees” at least until 2011, it seems that support is coming in by the millions to help reignite this issue. In a effort to have Congress re-evaluate their decision to hold off on making any changes to the industry petitions with millions of signatures have been sent to help showcase the urgency on the growing need to have these fees regulated to help drive down cost to businesses.

In an effort to help regulate interchange fees otherwise known as “credit card swipe fees”, over the past two years many companies have asked their customers to sign petitions in hopes that these will change the mind of those in Congress to act sooner than later. While petitions were first mentioned last year by 7-Eleven, which resulted in a staggering number of signatures, these recent petitions were looking to get much more. Although just over 1.5 million were submitted to Congress last year, this year over 2 million have been sent by other organization wanting a change. In all, the over 3 million signatures were much more than expected, and business owners hope that the voice of the people will weigh in heavily with those looking to for re-election in the coming months.

via Consumers Join Credit Card Interchange Fee Fight.

Goldman Sachs Troubles

Goldman Sachs Told It Was Getting 100 Cents On The Dollar From AIG, Top Exec Says (VIDEO)

AIG and federal authorities did not negotiate with Goldman Sachs when it came to the firm’s controversial $12.9 billion payout from AIG, courtesy of taxpayers, a top Goldman official told Senators today.

After the federal government stepped in to rescue the teetering insurance giant in the fall of 2008, the New York Fed, then led by current Treasury Secretary Timothy Geithner, directed AIG to pay its counterparties 100 cents on the dollar on their complex derivatives deals. More than $27 billion of taxpayer money went into the coffers of firms like Goldman Sachs and Deutsche Bank. The firms were also allowed to keep $35 billion in collateral previously posted by AIG.

via Goldman Sachs Told It Was Getting 100 Cents On The Dollar From AIG, Top Exec Says (VIDEO).

Goldman Sachs rationalized fraud – CSMonitor.com

By Ronald J. Colombo / April 27, 2010

Long Island, N.Y.

This month’s announcement of the US Securities and Exchange Commission (SEC)’s securities-fraud civil suit against Goldman Sachs is a perfect example of what ails our society today – and why attempted regulatory fixes are in many ways analogous to rearranging the deck chairs on the Titanic.

via Goldman Sachs rationalized fraud – CSMonitor.com.

Senator Carl Levin blasts Goldman Sachs over email calling Timberwolf investment ‘one sh***y deal’

BY Amanda Mastrull and Lauren Johnston

DAILY NEWS WRITERS

Tuesday, April 27th 2010, 2:46 PM

Harrer/BloombergSenator Carl Levin blasted Goldman Sachs at Senate hearings over an internal email describing Timberwolf as ‘one sh***y deal’. Related NewsArticlesAs fraud case looms, Goldman Sachs earns $3.3B in Q1E-mails reveal Goldman Sachs execs gloated as housing market crashedGoldman Sachs CEO Lloyd Blankfein to testify before SenateGoldman CEO: We ‘certainly’ did not bet against clientsGoldman fights back! Firm says it did not ‘bet against’ own clients, unduly benefit from bailoutOne thing is clear from today’s Goldman Sachs Senate hearings – Sen. Carl Levin does NOT approve of “sh***y deals.”

via Senator Carl Levin blasts Goldman Sachs over email calling Timberwolf investment ‘one sh***y deal’.

Goldman Sachs’ Long Day In Washington « Forbes.com’s StreetTalk

Nathan Vardi is an associate editor at Forbes

It was a grueling Tuesday in Washington for Goldman Sachs Chief Executive Lloyd Blankfein and other Goldman executives, who struggled to explain themselves before a panel of U.S. senators. They were portrayed as Las Vegas pit bosses and bookies who peddled “sh**ty” products that helped bring the U.S. financial system to the brink of collapse.

Blankfein tried to be humble and keep the conversation dignified. “Many Americans are skeptical about the contribution of investment banking to our economy and understandably angry,” said Blankfein. “We are trying to deal with the implications of the crisis for ourselves and for the system.”

via Goldman Sachs’ Long Day In Washington « Forbes.com’s StreetTalk.

Dana Milbank – Goldman Sachs whiz kid Tourre lacks apology, but not arrogance

By Dana Milbank

Wednesday, April 28, 2010

Fabulous Fab was having another less-than-fabulous day.

Goldman Sachs whiz kid Fabrice Tourre is fast becoming the poster boy of the financial crisis, a Michael Milken for current times. Last week, the SEC filed fraud charges against Goldman Sachs and the 31-year-old Frenchman who calls himself Fabulous Fab. And on Tuesday, Fabulous sat before a Senate panel that wanted to know how he helped a hedge-fund tycoon make a billion dollars by dumping worthless mortgage securities on unsuspecting Goldman customers and then betting against those same securities — all the while accelerating the burst of the housing bubble and the downfall of the world economy.

via Dana Milbank – Goldman Sachs whiz kid Tourre lacks apology, but not arrogance.

Visa Europe offers to cut debit card fees | Reuters

(Reuters) – Payment card company Visa Europe (V.N) offered on Monday to cut domestic transaction fees on debit cards by 60 percent to 0.2 percent in a move that could end European Commission antitrust proceedings in this area.

Hot Stocks

“I welcome Visa Europe’s willingness to reduce multilateral interchange fees and to make its rules more transparent,” Competition Commissioner Joaquin Almunia said.

The reduction on cross-border fees would be 30 percent, Commission spokeswoman Amelia Torres told a news briefing.

The European Union executive said in a statement that after the usual internal procedures at the Commission, Visa Europe’s proposal would be market tested.

via Visa Europe offers to cut debit card fees | Reuters.

Retailers call for further action as Visa caps credit card fees | TheMoodieReport.com

EU. The Travel Retail Fair Payment Alliance has called for further action on the issue of credit card company fees for retailers, despite Visa’s announcement that it will cap its fees for cross-border debit card transactions at 0.20%. The move came amid pressure from the EU Commission, which is investigating Visa’s fee charging system.

Although the Commission welcomed the reduction, the Fair Payment Alliance called it a “lost opportunity” in the drive to create a competitive market across Europe.

“In particular the announcement avoided decisions on Visa’s Multilateral Interchange Fees (MIF) for consumer credit and deferred debit card transactions, which are included in the ongoing antitrust investigation,” noted the Fair Payment Alliance.

via Retailers call for further action as Visa caps credit card fees | TheMoodieReport.com.

Euronet Worldwide Receives Notice of Change in Polish Interchange Fees – MarketWatch

LEAWOOD, Kan., Apr 27, 2010 (BUSINESS WIRE) — Euronet Worldwide, Inc. (“Euronet” or the “Company”) /quotes/comstock/15*!eeft/quotes/nls/eeft (EEFT 20.96, -0.16, -0.76%) , a leading electronic payments provider, today announced it has been informed that Visa Europe (“Visa”) notified its member banks that it will lower the Polish domestic ATM interchange fee from PLN 3.50 to PLN 1.30 (from approximately USD $1.20 to approximately $0.45, at current exchange rates), effective May 1, 2010. The interchange fee is paid by issuers of Visa logo’d cards to the owners or operators of ATMs for transactions such as cash withdrawals on ATMs. While this announcement has no impact on first quarter 2010 results, Euronet expects the impact of this fee adjustment on the results of operations of its Polish business to be significant in future periods.

Currently, Euronet has approximately 1,500 Company-owned ATMs under management in Poland, provides outsourced management services to Polish financial institutions and, through network participation agreements, makes its 2,560 ATMs available to financial institutions in Poland. Approximately 25% of Euronet’s 10,283 operated ATMs are in Poland and approximately 7.5% of Euronet consolidated revenue is earned in Poland

via Euronet Worldwide Receives Notice of Change in Polish Interchange Fees – MarketWatch.

Consumers Urge Congress To ‘Stop Unfair Credit Card Swipe Fees’

[via NACS Press Release]
WASHINGTON – NACS is delivering a record-setting number of consumer signatures to Congress today, telling them that hidden credit and debit card swipe fees are unacceptable and that Congress must fix a clearly broken system.

The 2 million consumer signatures that were collected at convenience stores across the country earlier this year make it the largest collection of consumer signatures ever for a public-policy issue. Combined with the 1.7 million signatures that 7-Eleven franchisees collected and delivered to Congress last September, 3.7 million consumers have weighed in on this issue over the past year.

Credit and debit card swipe fees — called “interchange fees” by the big banks that set these rates — are a percentage of each transaction that Visa and MasterCard and their member banks collect from retailers every time a credit or debit card is used. These fees average about 2 percent in the United States, the highest rate in the industrialized world.

In 2008 alone, Americans paid over $48 billion in credit card swipe fees. These fees are non-negotiable and set in secret by the credit card companies and their member banks.

“Millions of Americans did their part in signing these petitions and urging Congress to take action against unfair swipe fees. Now it’s time for Congress to step up to the plate and take a swing,” said NACS Chairman Jay Ricker, president of Anderson, Ind.-based Ricker Oil Co.

“The secretive and collusive way the credit card companies set swipe fees and impose them on store operators is bad for business and bad for consumers,” said NACS President and CEO Hank Armour. In announcing the NACS petition campaign last October, Armour asked retailers to “overwhelm Congress with millions and millions of signatures demanding action to fix the broken credit card system,” and that was on display at the event.

“These 3.7 million customers represent the tidal wave of support behind swipe fee reform. And if 3.7 million signatures aren’t enough, we’ll send more,” added David Seltzer, treasurer of 7-Eleven Inc. “We know how important this issue is for Main Street merchants and consumers, and we’re not going away.”

Credit card fees continue to be the convenience store industry’s top pain point and second largest expense item — behind only labor costs. As a percentage of overall sales, credit card fees increased in 2009, from 1.35 to 1.45 percent of total industry sales dollars, factoring in all forms of payment, including cash and check. Total credit card fees ($7.4 billion) also surpassed overall convenience store industry pretax profits ($4.8 billion) for the fourth straight year in 2009.

On Wednesday, April 28, Dave Carpenter, president and CEO of J.D. Carpenter Companies Inc. (Urbandale, IA), will testify on behalf of NACS at a hearing on H.R. 2695, the Credit Card Fair Fee Act, before the U.S. House Judiciary Committee. Wednesday’s hearing begins at 10:00 am and can be accessed via a live webcast. Look for exclusive coverage of the hearing in Thursday’s NACS Daily.

Take Action
NACS urges all members to contact their representatives and senators and ask them to support H.R. 2695 and the Senate companion measure, S. 1212. Ask to be connected to your members of Congress via the Capitol switchboard at (202) 224-3121, and/or send a letter through the NACS grassroots page. If you need assistance or talking points, contact the NACS government relations team at (703) 684-3600

via Consumers Urge Congress To ‘Stop Unfair Credit Card Swipe Fees’.

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Visa offers to resolve competition concerns | Policies | Business | Competition | European Voice

Credit card firm seeks agreement with Commission on fees imposed on retailers.

The European Commission today (26 April) took a major step towards reaching an agreement with credit card company Visa on the fees it can impose on retailers.

In March 2008, the Commission launched an antitrust investigation into multilateral interchange fees (MIFs) because of concerns that Visa and its affiliated banks colluded to keep them artificially high. It reached a preliminary decision in April 2009 that the fees “restrict competition…without benefiting consumers”, and break EU antitrust rules.

via Visa offers to resolve competition concerns  |  Policies  |  Business  |  Competition | European Voice.

National Retail Federation Video: Battling Credit Card SwipeFee Monopoly

Repost: National Retail Federation Senior Vice President and General Counsel Mallory Duncan Duncan discusses his October 8, 2009, testimony before the House Financial Services Committee and explains how the credit card industry is in an “arms race” to raise “swipe” fees.

NACS Video: Fight Swipe Fees!

NACSTV — April 26, 2010 — NACS, the association for convenience and petroleum retailing, delivered a record-setting number of consumer signatures to Congress on April 27, telling them that hidden credit and debit card swipe fees are unacceptable and that Congress must fix a clearly broken system. Learn more at http://www.fightswipefees.com

KPBJ.COM | Battle over swipe fees gains momentum | Business Weekly Article | The KPBJ | KITSAP PENINSULA BUSINESS JOURNAL

Retailers’ battle with the credit card industry over constantly rising “interchange” fees charged to merchants every time a card is swiped to pay for a transaction is getting attention on multiple fronts this week.

Interchange was the subject of a major op-ed article by American Antitrust Institute President Albert A. Foer published in the New York Times on recently.

“These days, it’s hard to find anyone who doesn’t use credit and debit cards regularly — they’re convenient and compact and often come with small cash-back incentives,” Foer wrote. “But what almost no one realizes is that those benefits are far outweighed by an implicit transaction fee set by credit card companies and their issuing banks that costs consumers more than $48 billion a year.”

via KPBJ.COM | Battle over swipe fees gains momentum | Business Weekly Article | The KPBJ | KITSAP PENINSULA BUSINESS JOURNAL.

Retailers ask Senate to address credit card swipe fees – 4/26/2010 11:23:00 AM – Home Accents Today

— Home Accents Today, 4/26/2010 11:23:00 AM

Retailers are asking the Senate to address credit card swipe fees in financial services reform legislation expected to be on the floor this week.

The National Retail Federation and the NRF’s Council of Chain Restaurants were among 55 associations that signed a letter to senators calling for “simple, common-sense reforms.”

The groups asked that the FTC or another federal agency be given power to “examine and reform the restrictive rules and regulations associated with electronic transactions,” including giving merchants the right to set minimum and maximum credit card purchase amounts and to steer customers toward cheaper forms of payment such as cash, check or PIN debit rather than credit cards.

via Retailers ask Senate to address credit card swipe fees – 4/26/2010 11:23:00 AM – Home Accents Today.

Retailers ask Senate to address credit card swipe fees – 4/26/2010 11:23:00 AM – Home Accents Today

— Home Accents Today, 4/26/2010 11:23:00 AM

Retailers are asking the Senate to address credit card swipe fees in financial services reform legislation expected to be on the floor this week.

The National Retail Federation and the NRF’s Council of Chain Restaurants were among 55 associations that signed a letter to senators calling for “simple, common-sense reforms.”

The groups asked that the FTC or another federal agency be given power to “examine and reform the restrictive rules and regulations associated with electronic transactions,” including giving merchants the right to set minimum and maximum credit card purchase amounts and to steer customers toward cheaper forms of payment such as cash, check or PIN debit rather than credit cards.

via Retailers ask Senate to address credit card swipe fees – 4/26/2010 11:23:00 AM – Home Accents Today.

Visa Europe Offers to Settle EU’s Card-Fees Case (Update1) – BusinessWeek

By Stephanie Bodoni

April 26 (Bloomberg) — Visa Europe Ltd., operator of the largest payment-card network in the 27-nation European Union, offered to reduce debit card transaction fees paid by retailers in a bid to resolve an EU antitrust case.

The European Commission said it may close its investigation into debit-card charges after Visa Europe promised “to significantly cut” fees to 0.2 percent. A separate probe into fees for credit-card and deferred-debit transactions, where customers must settle their bills at the end of the month, will continue, the Brussels-based agency said.

via Visa Europe Offers to Settle EU’s Card-Fees Case (Update1) – BusinessWeek.

Visa offers to resolve competition concerns | Policies | Business | Competition | European Voice

Credit card firm seeks agreement with Commission on fees imposed on retailers.

The European Commission today (26 April) took a major step towards reaching an agreement with credit card company Visa on the fees it can impose on retailers.

In March 2008, the Commission launched an antitrust investigation into multilateral interchange fees (MIFs) because of concerns that Visa and its affiliated banks colluded to keep them artificially high. It reached a preliminary decision in April 2009 that the fees “restrict competition…without benefiting consumers”, and break EU antitrust rules.

A spokeswoman for Joaquín Almunia, the European commissioner for competition, said the commissioner had received an offer from Visa to cut the fees, and was putting this out for consultation with interested parties – a sign that he believes the offer could resolve the Commission’s competition concerns.

via Visa offers to resolve competition concerns  |  Policies  |  Business  |  Competition | European Voice.

EU bankcard interchange fee settlement: US ramifications – GLG News

Visa Europe has settled the EU’s antitrust action against its major debit card interchange fees. It will reduce them by up to 60% The settlement does not cover credit card interchange. And it has nothing to do with the interchange lawsuits in the US. Visa Europe is an independent company with a license from Visa, Inc. to sell its products.

via EU bankcard interchange fee settlement: US ramifications – GLG News.

Georgia Committee Hears Interchange Bill

ATLANTA — The Georgia House Banks and Banking Committee heard testimony last week on HB 1456, which deals with unfair practices of credit card companies regarding interchange. The hearing before the full committee was significant in that usually such late session bills are “buried” in subcommittee, which was exactly what credit card companies want to happen.

Instead Committee Chairman James Mills, who co-sponsored the bill, decided to let the full committee hear testimony on the interchange issue. The result was a very positive hearing for retailers.

via Georgia Committee Hears Interchange Bill.

Visa Europe to Cut Debit-Card Fees – WSJ.com

BRUSSELS—Visa Europe agreed Monday to lower some of the fees assessed for debit-card transactions in a bid to end a European Union antitrust probe.

Antitrust investigators from the European Commission have been examining for several years the fees embedded in both Visa’s and Mastercard’s system. Mastercard settled a similar case last year.

via Visa Europe to Cut Debit-Card Fees – WSJ.com.

Carpenter Builds Case Against Swipe Fees | CSP Daily News / Magazine | CSP Information Group, Inc.

WASHINGTON — Convenience store retailer Dave Carpenter will testify before the House Judiciary Committee on Wednesday during a hearing on the Credit Card Fair Fee Act of 2009 (H.R. 2695).

“I will be testifying as a small convenience/gas retailer and as a bank owner,” Carpenter, who is president of J.D. Carpenter Cos., Urbandale, Iowa, told CSP Daily News. “The credit-card companies have inundated D.C. with small community banks and credit unions saying that reducing interchange will have a huge impact on them. This is simply not true, so I will do my best to debunk that myth.”

The Credit Card Fair Fee Act of 2009, among other things, would require the rates and terms of a voluntarily negotiated access agreement to be the same for all merchants and participating providers, regardless of their respective category or volume of transactions. It would require issuers, acquirers, owners and merchants to make specified disclosures regarding itemized costs and access agreements. It also would requires the negotiating parties to file jointly with the Attorney General any voluntarily negotiated access agreement that affects any market in the United States or elsewhere.

via Carpenter Builds Case Against Swipe Fees | CSP Daily News / Magazine | CSP Information Group, Inc..

Visa Europe offers to cut debit card fees to 0.2% | Reuters

BRUSSELS, April 26 (Reuters) – Payment card company Visa Europe (V.N) offered on Monday to cut domestic transaction fees on debit cards by 60 percent to 0.2 percent in a move that could end European Commission antitrust proceedings in this area.

Financials

“I welcome Visa Europe’s willingness to reduce multilateral interchange fees and to make its rules more transparent,” Competition Commissioner Joaquin Almunia said.

The reduction on cross-border fees would be 30 percent, Commission spokeswoman Amelia Torres told a news briefing.

The European Union executive said in a statement that after the usual internal procedures

via Visa Europe offers to cut debit card fees to 0.2% | Reuters.

Report: Interchange Fees Impede Economic Growth, Job Creation

February 22, 2010 – INDIANAPOLIS — Less than 20 percent of the interchange fees charged by credit card companies actually covers the cost of processing transactions, according to a new report by former U.S. Under Secretary of Commerce Robert J. Shapiro, entitled: “The Costs of ‘Charging It’ in America: Assessing the Economic Impact of Interchange Fees for Credit Card and Debit Card Transactions.”

The findings of the report — commissioned by the Consumers for Competitive Choice (C4CC) coalition and co-authored by economist Jiwon Vellucci — were released during a teleconference yesterday — the same day the Credit Card Accountability Responsibility and Disclosure (CARD) Act of 2009 went into effect.

via Report: Interchange Fees Impede Economic Growth, Job Creation.

CSNews Exclusive: C-stores Face Legal Crossroads in Interchange Lawsuit

April 22, 2010 – NEW YORK — The proposed class-action lawsuit over interchange rates brought by merchants against Visa and MasterCard and their member banks is entering a critical juncture, and convenience stores of all sizes have some important decisions to make, attorneys Jeffrey I. Shinder and Matthew L. Cantor told CSNews Online.

Shinder and Cantor, partners in the law firm of Constantine Cannon LLP, are well-versed in the interchange battle. They were the lead counsel, representing a class of 5 million merchants, in the 2003 class-action suit against Visa and MasterCard over their signature debit cards. That case delivered more than $2.5 billion in settlement payments.

via CSNews Exclusive: C-stores Face Legal Crossroads in Interchange Lawsuit.

Fight MasterCard and Visa Credit Card Swipe Fees

What are swipe fees?
A swipe fee is a fee collected from retailers by the credit card companies and their member banks every time a credit or debit card is used to pay for a purchase. This fee is also known as “interchange.” This fee varies with type of card, size of merchant and other factors, but as much as $2 of every $100 you spend on plastic goes to card issuers. Credit and debit card interchange collected by Visa and MasterCard banks totaled about $48 billion in 2008, triple what it was in 2001. These fees raise prices for consumers. In 2008, the average American family paid about $427 in interchange fees.

How much do hidden swipe fees cost consumers?
Swipe fees add to the price of everything we buy, even if we choose not to use a credit or debit card. Americans paid about $48 billion in credit card swipe fees in 2008 alone, more than all other credit card fees combined.

How are swipe rates determined?
Visa and MasterCard each separately work with their member banks to set swipe fees. The agreement between these banks, which should compete for business, is illegal price fixing and it hurts consumers and merchants.

How fast are swipe fees increasing?
Visa and MasterCard collected about $48 billion in swipe fees in 2008, triple what was collected in 2001. In 2008, the average American family paid about $427 in swipe fees. Swipe fees are rising the fastest on gasoline purchases; payouts to the credit card industry have more than doubled since 2004. Credit card companies and their member banks have increased the amount of swipe fees collected by both increasing rates and encouraging more people to pay by plastic instead of cash.

Don’t these fees just cover the cost of processing the transactions?
Even though advances in technology continue to bring down the cost of transaction processing, swipe fees keep going up. A recent study concluded that only 13 percent of the swipe fees that the big credit card companies collect actually goes for transaction processing. Most of the money goes toward profits for the banks, rewards programs that benefit mostly affluent cardholders and direct mail marketing campaigns that clog mailboxes with nine billion unsolicited credit card offers every year. Many of those unsolicited mailings include so-called “convenience checks”that can be stolen and cashed by someone other than the authorized card holder. Yet the card companies and their banks spend only four percent of the swipe fees they collect on measures to protect consumers from this and other forms of credit card fraud.

How do swipe fee rates in the U.S. compare to fees in other countries?
U.S. swipe fees average close to two percent, while in other industrialized countries like Australia the rate is one-half of one percent and in Europe the rate for cross border transactions is less than one-third of one percent.

Why are swipe fees so high in the U.S.?
Visa and MasterCard each separately work with their member banks collectively to set the price of swipe fees. This is illegal price fixing and hurts Americans. Credit card swipe fees have tripled since 2001 and there’s no end in sight, even though the actual cost of transaction processing continues to go down.

Do consumers who pay with cash also pay hidden swipe fees?
American consumers pay the hidden credit card swipe fee on virtually every purchase they make, whether they use a credit card or not because the credit card companies require merchants to spread the cost of these fees to all of their customers. The system is structured so that credit card companies make more money on each transaction when the price of retail goods increases. For example, even though the cost of processing a $1 transaction is virtually the same as processing a $100 transaction, the swipe fee paid on that $100 sale is higher because the swipe fee is calculated as a percentage of the total sale. The higher the sale, the higher the fee.

What is being done about it
What are merchants doing to change unfair swipe fees?
A group of retailers, supermarkets, drug stores, convenience stores, fuel stations, and other businesses are fighting against unfair credit card fees. They want a more competitive and transparent card system that works better for consumers and merchants alike and have formed the Merchants Payments Coalition and launched the website unfaircreditcardfees.com. The coalition’s member associations collectively represent about 2.7 million stores with approximately 50 million employees. Convenience stores across the nation, who are among the hardest hit by unfair swipe fees because of the fees assessed to gasoline sales, have taken action to alert their customers about these fees and are collecting millions of signatures urging Congress to reform the system. In addition, this website you are visiting (fightswipefees.com) makes it easy for consumers to sign an online petition to Congress or even send a letter directly to their representatives urging action to reform unfair swipe fees.

What are consumers doing to change unfair swipe fees?
Individual consumers are beginning to take action to urge Congress to reform unfair swipe fees. In the summer of 2009, nearly 1.7 million consumers signed petitions at 7-Eleven stores urging such action. This winter, millions more are signing similar petitions in convenience stores across the country or via this website (fightswipefees.com).

In addition, several national consumer organizations are urging Congress to take action. These include:
U.S. PIRG (Public Interest Research Group). In testimony before the House Financial Services Committee, Edmund Mierzwinski (PDF), PIRG’s consumer program director, supported legislation to reform unfair swipe fees and said:

Interchange fees are hidden charges paid by all Americans, regardless of whether they use credit, debit, checks or cash. These fees impose the greatest hardship on the most vulnerable consumers – the millions of American consumers without credit cards or banking relationships. These consumers basically subsidize credit and debit card usage by paying inflated prices – prices inflated by the billions of dollars of anticompetitive interchange fees. And unfortunately, those interchange fees continue to accelerate, because there is nothing to restrain Visa and MasterCard from charging consumers and merchants more.

Americans for Financial Reform. This is a coalition of 200 national, state and local consumer, labor, retiree, investor, community, and civil rights organizations who have come together to spearhead a campaign for real reform in our banking and financial system. In an official policy paper endorsing swipe fee reformt, the group said:

Markets don’t work when there are hidden fees and rules – and no one hides fees and rules better than the credit card companies. Credit card markets lack the information necessary for both consumers and merchants to make informed choices. For merchants, the markets lack adequate information because the associations prevent merchants from accurately informing consumers of the costs of credit card acceptance or attempting to direct them to more efficient and lower priced payment mechanisms. In fact, merchants have no alternative but to accept the card associations’ cards even when the associations significantly increase prices.

More info and source: http://www.fightswipefees.com/about.asp

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Food & Food Equipment News: Supermarkets Call For Interchange Swipe Fee Reform Amidst Debit Card Fee Increases

As millions of hardworking Americans pay their income taxes today, it is important to recognize that every year the average American family also pays more than $400 in interchange fees, or swipe fees, to banks and credit card companies.

Beginning tomorrow, Interlink, the personal identification number (PIN) debit network run by Visa, will increase by nearly 30 percent the swipe fees retailers have to pay when customers use PIN debit cards.

“It is unacceptable that Visa continues to increase fees at a time when our country needs to protect the hardworking Americans who provide jobs in our communities,” said Leslie G. Sarasin, president and chief executive officer at the Food Marketing Institute. “Swipe fees are hurting small independent businesses and grocers the most because they pay some of the highest rates and have no choice about whether or not to accept debit cards to remain competitive.”

via Food & Food Equipment News: Supermarkets Call For Interchange Swipe Fee Reform Amidst Debit Card Fee Increases.

Retail’s BIG Blog | New York Times op-ed says swipe fee costs outweigh credit card benefits

Retailers’ battle with the credit card industry over constantly rising “interchange” fees charged to merchants every time a card is swiped to pay for a transaction is getting attention on multiple fronts this week.

Interchange was the subject of a major op-ed article by American Antitrust Institute President Albert A. Foer published in the New York Times on Wednesday.

“These days, it’s hard to find anyone who doesn’t use credit and debit cards regularly – they’re convenient and compact and often come with small cash-back incentives,” Foer wrote. “But what almost no one realizes is that those benefits are far outweighed by an implicit transaction fee set by credit card companies and their issuing banks that costs consumers more than $48 billion a year.”

via Retail’s BIG Blog | New York Times op-ed says swipe fee costs outweigh credit card benefits.

New rules benefit consumers | Money | London Free Press

Consumers could come out on top as Canada’s credit card industry adapts to new rules and spending habits, turning one of the most profitable markets for the big companies into the least, Deloitte said in a report Thursday.

The industry is at a turning point and creative card issuers will seize the opportunity to innovate, according to Patricia Daley, leader of Deloitte Canada’s payments practice

via New rules benefit consumers | Money | London Free Press.

Credit card companies haven’t bitten back — yet | Atlanta Bargain Hunter

We were fearful of what credit card companies might do in response to sweeping, consumer-friendly regulations that came down the pike in February.

So far, not much, according to a Bankrate.com survey of the 50 largest card issuers conducted April 1-8. The company compared the fees on 73 of the most basic cards. Of those, 33 were issued by credit unions and 40 by banks. Of the 73, only 12 had a fixed interest rate.

Only a few have implemented the dreaded inactivity fee or annual fees.

via Credit card companies haven’t bitten back — yet | Atlanta Bargain Hunter.

The Credit Card Accountability Responsibility and Disclosure Act of 2009 | Deloitte & Touche LLP

A new financial services market is emerging from the current turmoil that is more protective of consumer interests. The Credit Card Accountability Responsibility and Disclosure Act of 2009 (“Card Act”), which was signed into law on May 22, 2009, will have important implications for financial institutions.

For the card industry, the Card Act comes at a challenging time. After achieving pre-tax profits of $40 billion in 2007, in 2008 losses began to mount and credit markets began to stall, denying many issuers access to securitized funding. After a significant period of expansion, the industry now faces the prospect of contraction.

via The Credit Card Accountability Responsibility and Disclosure Act of 2009 | Deloitte & Touche LLP.

Nonprofits want $400M from Wells Fargo | StarTribune.com

Setting the stage for a lengthy and contentious trial, four nonprofit Minnesota institutions demanded more than $400 million Thursday from banking giant Wells Fargo asserting their funds were put at risk in the bank’s specialized securities lending program that included “potentially very dangerous” investments.

In his opening statement before a jury in St. Paul, the nonprofits’ attorney Mike Ciresi said evidence in the civil trial “will show not only negligence but gross negligence” as the bank shifted from conservative money-market-style investments to more exotic ones, including mortgage-backed securities

via Nonprofits want $400M from Wells Fargo | StarTribune.com.

Goldman Sachs may not be the only firm in SEC cross hairs – Los Angeles Times

The agency’s fraud suit against the Wall Street giant may foreshadow similar cases against other financial firms and trigger a wave of private litigation.

April 22, 2010|By E. Scott Reckard, Los Angeles Times

The government’s fraud lawsuit against Goldman, Sachs & Co. could portend cases against other financial giants that turned subprime mortgages into complex securities while also accelerating a surge in private litigation against Wall Street.

via Goldman Sachs may not be the only firm in SEC cross hairs – Los Angeles Times.

Consumers to reap rewards as credit card industry evolves | Money | Toronto Sun

Consumers could come out on top as Canada’s credit card industry adapts to new rules and spending habits, turning one of the most profitable markets for the big companies into the least, Deloitte said in a report Thursday.

The industry is at a turning point and creative card issuers will seize the opportunity to innovate, according to Patricia Daley, leader of Deloitte Canada’s payments practice.

“This will bring about a new generation of card and payment services — many of which will directly benefit Canadian consumers,” Daley said in a release.

via Consumers to reap rewards as credit card industry evolves | Money | Toronto Sun.

Consumers to win as Canada’s credit card market evolves

Consumers are the winners when it comes to Canada’s evolving credit card market, Deloitte said in a report Thursday.

The industry is at a turning point and creative card issuers will seize the opportunity to innovate, according to Pat Daley, leader of Deloitte Canada’s payments practice.

“This will bring about a new generation of card and payment services — many of which will directly benefit Canadian consumers,” Daley said in a release.

via Consumers to win as Canada’s credit card market evolves.

Richard (RJ) Eskow: The Most Important Speech the President Has Ever Given

President Obama will return to Cooper Union in New York, where he gave a speech on financial reform as a candidate two years ago. We’re told that his advisors want him to “go big” in his speech, as he did when he addressed a joint session of Congress on health reform. But if he follows the same course he followed in health reform — “going big” on rhetoric and then “acting small” on policy — he’s not just courting political blowback: He’s running the risk of going down in history as this century’s Herbert Hoover.

Sound harsh? People often forget that Hoover was a fine man — intelligent, altruistic, and deeply bipartisan in his temperament. The structural problems that led to the Great Depression didn’t occur on his watch. But by failing to act boldly and decisively he endangered the economic foundation of the country. He was an eminently reasonable person, but there is enormous danger in having the right temperament at the wrong time. We’re living in unreasonable times.

via Richard (RJ) Eskow: The Most Important Speech the President Has Ever Given.

Obama: 'Free market' is not a 'free license' – The Oval: Tracking the Obama presidency

President Obama says he believes in the free market, but “it was never meant to be a free license to take whatever you can get, however you can get it” — and that’s why new Wall Street regulations are needed.

The White House included that argument in excerpts just released of Obama’s New York City speech, to be delivered around noon.

via Obama: ‘Free market’ is not a ‘free license’ – The Oval: Tracking the Obama presidency.

Obama Looks to Close Sale on Financial Reform – DealBook Blog – NYTimes.com

Just over three years ago, early in his uphill campaign for president, Senator Barack Obama wrote to the Federal Reserve chairman and the Treasury secretary calling for a summit conference to address signs of trouble in the housing and financial markets, Jackie Calmes reports in The New York Times.

While Mr. Obama could not have known how bad things would get, then as now he saw a muscular role for government in enforcing regulations in the public’s interest, while weighing them against the industry’s interests so both would benefit.

via Obama Looks to Close Sale on Financial Reform – DealBook Blog – NYTimes.com.

NRF Testifies in Favor of Vermont Credit Card Swipe Fee Bill

(via Press Release)

Montpelier, Vt., April 21, 2010 – The National Retail Federation today urged the Vermont legislature to give final approval to legislation that would address credit card “swipe” fees, saying merchants should be able to give a discount to customers who pay by cash, check or debit card.

“The card companies have a ‘discrimination’ rule,” NRF Senior Vice President and General Counsel Mallory Duncan said. “It prohibits merchants from giving customers a discount if the customer uses cash, checks or a card with lower fees. This is a remarkably anti-competitive rule. It’s like Pepsi and Coca-Cola telling stores that they could be fined if they charged people less for other soft drinks. Its effect, of course, is to discourage the market from moving toward cheaper forms of payment. That’s good news for credit card companies but bad news for retailers and their customers.”

Duncan testified today before the Vermont House Commerce and Economic Development Committee during a hearing on S. 138.

If enacted, the bill would allow Vermont retailers to set both minimum and maximum credit card purchases without interference from Visa and MasterCard banks, which currently bar the practice in their contracts with merchants. The two companies would also be prohibited from dictating how merchants price items or blocking a merchant from giving a discount for cash, checks, debit cards or credit cards with lower-than-usual swipe fees. Visa and MasterCard also could not force a retailer to accept cards at all store locations if the retailer only wanted to accept them at one location.

The bill is based in part on the Credit Card Interchange Act, federal legislation addressing fees charged to merchants sponsored by U.S. Representative Peter Welch, D-Vt., that is awaiting action in Washington.

Retailers have long wanted freedom to set minimum purchase amounts because swipe fees can exceed a merchant’s profit on small purchases. On big-ticket items, the swipe fee can significantly drive up the price that must be charged.

Officially known as interchange, swipe fees average about 2 percent of the purchase price and are charged to merchants by Visa and MasterCard banks each time one of their cards is swiped to pay for a purchase. Collections totaled $48 billion nationwide in 2008, triple the $16 billion collected when NRF began tracking the fees in 2001.

Cash and checks are not subject to swipe fees, and PIN debit cards are generally cheaper for merchants than credit cards or signature debit because they carry lower fees.

Duncan also explained how Visa and MasterCard rules effectively force merchants to pass the fees on to consumers by requiring them to be included in the advertised price of merchandise and making cash discounts difficult. As a result, a shopping bag of goods that could be sold for $99 has to be priced at about $101 on the assumption that the customer might pay by credit card, he said. Nationwide, the average household paid an estimated $427 in higher prices in 2008, up from $159 in 2001.

“Regardless of whether one uses cash, check or food stamps, we all end up paying the credit card company price,” Duncan said.

As the world’s largest retail trade association and the voice of retail worldwide, NRF’s global membership includes retailers of all sizes, formats and channels of distribution as well as chain restaurants and industry partners from the United States and more than 45 countries abroad. In the United States, NRF represents the breadth and diversity of an industry with more than 1.6 million American companies that employ nearly 25 million workers and generated 2009 sales of $2.3 trillion. http://www.nrf.com

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NACS Hails New Vermont Bill to Stop Credit Card Company Abuses

(via NACS Press Release)

ALEXANDRIA, Va. — New legislation passed through the Vermont Senate today will help rein in existing abusive practices by credit card companies, according to NACS.

This legislation advances through the Senate on a voice vote. The legislation, known as S.138, seeks to give retailers a say in how they accept various payment methods. In addition to prohibiting the credit card companies from interfering with a retailer’s ability to set certain conditions regarding card acceptance, the bill would provide enforcement by the state attorney general to violations by the credit card industry.

“The consumer-friendly legislation passed through the Vermont Senate addresses unfair practices by the nation’s largest financial institutions that cost Americans $48 billion in credit and debit card ‘swipe’ fees alone,” said NACS Senior Vice President of Government Relations Lyle Beckwith. “We applaud the Vermont Senate for standing up to the out-of-control credit card industry and telling them, ‘Enough is enough!’”

The bill was unanimously given preliminary approval by the Senate on March 30; today’s vote moves it through the Senate. The bill will now move to the Vermont House for consideration.

“The Vermont Senate’s action could be the start of a national movement,” suggested Vermont Grocer’s Association (VGA) President Jim Harrison in praising legislators for taking one the issue of swipe fee reform. The provisions of the bill would:

Prohibit the card companies from preventing retailers from setting minimum or maximum transaction amounts;
Prohibit the card companies from imposing a fine or penalty relating to the way a retailer displays prices; Stop the card companies from preventing retailers from deciding that they won’t take cards at one or more locations, while still taking cards at other locations; Require the Vermont Banking & Insurance Department to analyze a provision that would prohibit the card companies (Visa and MasterCard) from centrally fixing the price of interchange; and Institutes significant penalties for the use or possession of credit card skimming devices.
Consumers are clearly concerned about how credit and debit card swipe fees result in higher retail prices. Last year, 7-Eleven stores delivered 1.66 million customer signatures from a petition campaign urging Congress to stop unfair credit card fees. It was the most signatures ever delivered to Congress on a policy issue in American history. Earlier this year, more than 10,000 convenience stores committed to collect consumer signatures on petitions in their stores in a campaign coordinated by NACS, and Speedway SuperAmerica is conducting its own consumer petition drive for the month of April.

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NACS, the National Association of Convenience Stores, is the international association for convenience and petroleum retailing, representing more than 2,200 retail and 1,800 supplier member companies. The U.S. convenience store industry, with nearly 145,000 stores across the country, posted $624 billion in total sales in 2008, of which $450 billion was motor fuels sales.

Visa Inc. to Acquire CyberSource to Accelerate eCommerce Growth — SAN FRANCISCO and MOUNTAIN VIEW, Calif., April 21 /PRNewswire-FirstCall/ —

Visa Inc. to Acquire CyberSource to Accelerate eCommerce Growth — SAN FRANCISCO and MOUNTAIN VIEW, Calif., April 21 /PRNewswire-FirstCall/ —.

Strengthens Visa’s Leadership in Global eCommerce by Expanding Online Payment, Fraud and Security Management Capabilities

Enables Visa to Offer New and Enhanced Online Fraud Prevention Services to Merchants, Financial Institutions and Consumers

SAN FRANCISCO and MOUNTAIN VIEW, Calif., April 21 /PRNewswire-FirstCall/ — Visa Inc. (NYSE: V) (“Visa”) and CyberSource Corporation (Nasdaq: CYBS) (“CyberSource”) today announced that they have entered into a definitive agreement for Visa to purchase CyberSource, a leading provider of electronic payment, risk management and payment security solutions to online merchants at a price of $26.00 per share, or total consideration of approximately $2.0 billion to be paid with cash on hand.

CyberSource is an established industry leader that plays a role in processing approximately 25 percent of all eCommerce dollars transacted in the United States.  The company serves more than 295,000 merchants through its CyberSource and Authorize.Net branded solutions.  CyberSource clients include British Airways, Home Depot, Facebook, Google and many small businesses.

The acquisition of CyberSource will result in a compelling combination whose assets and expertise are expected to drive long-term growth by:  

• Accelerating the growth of the eCommerce category thereby also increasing the usage of Visa debit, prepaid and credit products for online purchases.
• Drawing on Visa’s financial institution relationships and global presence to more rapidly drive international expansion of CyberSource’s products and services.  Today the majority of CyberSource’s revenues are generated in the United States, leaving tremendous opportunity for global growth.
• Building on CyberSource’s relationships with merchants to expand the adoption and enhance the functionality of other Visa eCommerce solutions such as Rightcliq.
• Delivering best-in-class fraud management services to accelerate adoption of CyberSource solutions.
• Increasing adoption of CyberSource’s secure payment data hosting solutions to address a growing merchant need.

 

These benefits will be realized by merchants and financial institutions alike.  Together, Visa and CyberSource will help merchants increase revenue through global growth while minimizing monetary loss from fraud and provide them with fast and efficient connectivity to multiple payment networks, including Visa. For financial institutions acquirers, Visa will deliver added value by providing new business referrals from eCommerce merchants.

“Online commerce continues to grow rapidly, and this acquisition will enable Visa to offer new and enhanced services that will better meet the growing demand among merchants globally for robust, secure online payment processing capabilities which in turn will grow the entire eCommerce category,” said Joseph W. Saunders, Chairman and CEO of   Visa Inc.  “With CyberSource, we are adding a new suite of leading eCommerce capabilities and experience in addressing eCommerce merchant needs. And, as eCommerce increasingly migrates to mobile devices, we believe the combination of Visa and CyberSource technology and services will position Visa to lead in mobile eCommerce.”

The two companies are a proven team, having partnered since 1999, and currently collaborate on risk models built into CyberSource’s automated fraud management solutions.

“By joining forces with the world’s foremost payments company, we will have the opportunity to utilize Visa’s regional expertise and global presence to drive international adoption of CyberSource in key geographies,” said Michael Walsh, President and CEO of CyberSource Corporation.  

“We are excited to build on the existing relationship we have with Visa and extend the reach and capabilities of our eCommerce payment platform for small businesses and international brands around the world,” said William S. McKiernan, Executive Chairman and Founder of CyberSource.

“The acquisition of CyberSource aligns with Visa’s long-term strategic plan to identify and invest in opportunities today that will drive future growth and deliver enhanced value to Visa and our clients,” said Saunders.

Visa expects this transaction to be approximately $0.04 to $0.05 dilutive to its fiscal fourth quarter 2010 earnings per share on a GAAP basis, due to acquisition-related amortization and one-time transaction costs.  Visa expects this transaction to be slightly dilutive to its fiscal full-year 2011 earnings per share on a GAAP basis, primarily related to amortization of intangible assets.

CyberSource’s President and CEO, Michael Walsh, will continue to oversee CyberSource’s operations.  CyberSource’s Executive Chairman and Founder, William S. McKiernan, will join Visa as an Executive Advisor to assist in the integration of the two businesses.

The transaction is subject to customary closing conditions, including approval by the stockholders of CyberSource and required regulatory approvals. The transaction, which has been approved by the Visa and CyberSource boards of directors, does not require a Visa stockholder vote and is expected to close in Visa’s fourth fiscal quarter of 2010.  

Visa and CyberSource will host a conference call today at 5:30 a.m. Pacific time (8:30 a.m. Eastern time) to discuss the transaction. The dial-in information for the call is 888-790-4410 (within the United States) or 773-756-0127 (international). The conference passcode is GATEWAY. A replay of the call will be available until May 19 and can be accessed by dialing 800-925-4998 (within the United States) or 402-220-4330 (international).  The live call and replay, along with supporting materials, can also be accessed through the Investor Relations section of Visa’s website at www.investor.visa.com.

Op-Ed Contributor – Credit Cards and Hidden Fees – NYTimes.com

THESE days, it’s hard to find anyone who doesn’t use credit and debit cards regularly — they’re convenient and compact and often come with small cash-back incentives.

But what almost no one realizes is that those benefits are far outweighed by an implicit transaction fee, set by credit card companies and their issuing banks, that costs consumers more than $48 billion a year. As Congress works toward passing consumer financial reform legislation, it should include new rules about how — and how much — credit card companies can charge.

via Op-Ed Contributor – Credit Cards and Hidden Fees – NYTimes.com.

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Credit Card Innovations Find Home at MasterCard Labs

MasterCard officials affirmed their commitment to payment innovation this month with the launch of MasterCard Labs. Headed by former Orbiscom CEO Garry Lyons, MasterCard Labs will develop new payment technology for consumers and for credit card issuers. Bringing research and development in-house can help MasterCard compete more effectively with other payment platform providers, including Visa, Discover, and American Express.

In video announcements posted to MasterCard’s official YouTube channel, company leaders expressed their desire to keep up with the dramatic pace of change within the cashless payment processing industry. “Supporting breakthrough innovation efforts is at the heart of differentiating MasterCard from our competitors, and key to sustaining our competitive advantage in the marketplace,” says Ajay Banga, MasterCard president and chief operating officer.

via Credit Card Innovations Find Home at MasterCard Labs.

Counterintuitive Pitch for Higher-Fee Debit Category – American Banker Article

JPMorgan Chase & Co. has taken an out-of-the-ordinary approach to encourage customers to use their signature rather than their PIN when making debit card purchases.

There’s no cash-back incentive or promise of a big-screen television or travel reward. Instead, JPMorgan Chase is appealing to a more basic human desire: safety.

The problem, security experts said, is that PIN debit transactions are actually much more secure than signature debit purchases.

Signature debit is considerably more lucrative for a debit card issuer, however.

via Counterintuitive Pitch for Higher-Fee Debit Category – American Banker Article.

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SEC is looking into accounting at 19 biggest banks – Yahoo! News

WASHINGTON – The Securities and Exchange Commission is examining whether any of the 19 largest U.S. banks are using an accounting trick that a bankruptcy examiner has said led to the collapse of Lehman Brothers, SEC Chairman Mary Schapiro said Tuesday.

Schapiro testified at a congressional hearing that the SEC is scrutinizing Lehman’s use of the accounting move, known as Repo 105, that allowed it to mask its weakness before it failed. She said the agency has sent letters to the 19 banks, seeking information about any such transactions.

via SEC is looking into accounting at 19 biggest banks – Yahoo! News.

The Frank Luntz Memo On Financial Reform That Everyone Is Talking About

via Here’s The Frank Luntz Memo On Financial Reform That Everyone Is Talking About.

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Financial reform picks up speed – Eamon Javers – POLITICO.com

President Barack Obama travels to New York’s Cooper Union on Thursday to push his vision for Wall Street regulatory reform as part of a stepped-up drive to push the reforms through Congress.

The Senate could consider the legislation as early as this week, but a White House official said the president’s trip has been in the works for weeks. Still, fraud charges brought by the Securities and Exchange Commission against Goldman Sachs on Friday put the push in a different context, providing Obama new ammunition to back up his call for stiffer financial regulations.

via Financial reform picks up speed – Eamon Javers – POLITICO.com.

Senate leaders spar on financial reform | D.C. Now | Los Angeles Times

Senate leaders on Tuesday began their sparring over the financial reform bill, setting the tone for what is expected to weeks of debate on lawmakers’ next pitched battle.

Majority Leader Harry Reid (D-Nev.) urged Republicans to allow the financial reform bill to come to the Senate floor where both parties could offer amendments. He spoke after Minority Leader Mitch McConnell (R-Ky.) said he was pleased that bipartisan talks have resumed over some of the bill’s contested provisions.

via Senate leaders spar on financial reform | D.C. Now | Los Angeles Times.

Democrats Push for Support for Financial Reform – ABC News

Democrats are seeking at least one Republican vote to overcome procedural blocks to the financial reform bill, which is expected to begin debate next week, and are trying to build on widespread anti-bank sentiment ahead of the November mid-term elections.

via Democrats Push for Support for Financial Reform – ABC News.