West Virginia scores victory for consumers vs. MasterCard and Visa

by: Clem Guttata

Wed Jan 16, 2008 at 17:45:00 PM EST

Darrell McGraw's office reached a $12.l million settlement with Visa USA Inc. and MasterCard International Inc. on Monday, McGraw said during a Tuesday news conference.

The money will be put in a trust and will be doled out to customers via sales-tax holidays, McGraw said.

[snip]

Tuesday's announcement was the first step in getting the money to consumers, but the Legislature will address the specifics, he said.

There likely will be three to five holidays sometime this year, McGraw said.

Congratulations to Darrell McGraw's legal team for this settlement. I look forward to my sales tax holidays (pending the legislature's approval).

McGraw said the companies used illegal business practices by forcing merchants to accept both credit and debit cards, rather than only one.

"A credit card involves more risks ... as opposed to a debit card that debits money directly from an account," McGraw said. Thus, a fee for a debit should be less, he said.

The merchants were charged the same fee for both. McGraw's office said these increased costs were passed on to all consumers by increased prices.

"A few cents here and there ... adds up to a lot of money," McGraw said.

Because these increases are widespread and are pennies on the dollar for all consumers, it would nearly impossible for a private attorney to help all consumers affected, Hughes said.

"This [settlement] provides a remedy that helps everyone involved," she said.

Finally, as much as the U.S. Chamber of Commerce will hate to acknowledge it... this is a victory not only for consumers, but also for its members.