Consumers, Small ATM Networks Fight Against ATM Fees

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This month, over 50,000 people have joined an online group saying they will leave banks for what they say are unfavorable practices, such as Bank of America's planed $5 debit card fee. In an event titled "Bank Transfer Day" thousands are signing up to leave large banks in favor of credit unions on or before Saturday, November 5, over what some call unethical practices.

Another suit, filed on Oct. 17 from two consumers makes similar allegations as Genese's suit, but only against Visa and MasterCard. Lynne Barton of San Francisco and Charles Brown of Washington, D.C. are listed as plaintiffs.

George Sampson, an attorney of Hagens Berman Sobol Shapiro representing the plaintiffs, said the controversy over Bank of America's $5 debit card fee and the suit filed by the ATM providers captured his clients' attention for this lawsuit.

"Our clients are generally upset about debit card fees in general," Sampson said. "There should be competition in this marketplace and we believe competition would result in lower prices and perhaps consumers having to choose networks for their transactions."

Sampson said it is possible the same judge will hear all three of these recent cases, though it is too early to tell if the cases will be combined.

"It's probably in the interest of all the parties that the cases which raise the same factual issues are heard by a single issue," he said.

Sampson and his firm previously represented Walmart and other retailers against Visa and Mastercard in a suit that led to the demise of their rule which required merchants to accept both their credit cards and debit cards. That suit settled in 2003 resulting in over $3 billion in recovery to retailers who accepted their cards from October 1992 through June 2003.

Eric Grover, principal of Intrepid Ventures, corporate development and strategy for payment networks, said the current rules keep prices from being unfairly high for Visa and MasterCard customers.

"The ATM operators are saying that it's restricting their freedom," Grover said, but Visa and MasterCard are also making choices to promote their businesses.

"The networks have an interest in ensuring the environment such that folks that have economics have an incentive to deploy ATMs," he said. "They're saying, 'You are free to license our product and participate in our network or not. And if you do, these are the terms of our business.'"

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