Visa, MasterCard must refund $800 million
 

http://seattlepi.nwsource.com/busine...itcard09.shtml

Visa, MasterCard must refund $800 million

By MICHAEL LIEDTKE
THE ASSOCIATED PRESS

SAN FRANCISCO -- A Superior Court judge yesterday ordered credit-card giants Visa and MasterCard to refund about $800 million to U.S. customers who paid a hidden fee on purchases made in foreign countries.

Judge Ronald Sabraw's decision made final a tentative ruling that had been under court seal since February.

The case centers on a 1 percent surcharge Visa and MasterCard add to the transaction amount of credit-card charges requiring foreign currency to be converted into U.S. dollars. Concluding Visa and MasterCard have been concealing the conversion fee, Sabraw ordered refunds dating back to 1996.

Attorneys representing consumer interests in the 3-year-old case described the decision as vindication for millions of cardholders who had been misled for years about the costs of their foreign charges.

"The days of chicanery and petty theft on a grand scale are drawing to a close for Visa and MasterCard," said Jim Baum, one of the attorneys who filed the lawsuit on behalf of California resident Adam Schwartz.

Visa, based in Foster City, Calif., and New York-based MasterCard called the decision confounding and vowed to appeal.

"During five months of trial, not a single consumer complained ... that MasterCard has deceived them, treated them unfairly or harmed them in any way," said Noah Hanft, MasterCard's general counsel. "That's why we believe Judge Sabraw's decision to award restitution defies logic."

Based on estimates drawn from evidence in the trial, Visa faces $740 million in refunds while MasterCard is on the hook for about $60 million, said Dennis Stewart, another of Schwartz's attorneys.

The companies have not issued estimates.

A court hearing May 23 has been scheduled to discuss how the rebates will be made.

The currency conversion fee is disclosed in the initial agreements distributed to Visa and MasterCard customers, but the surcharge doesn't appear in billing statements documenting the transactions.

The fee instead is lumped into the total transaction price covering the item bought in a foreign country.

Although his decision said the credit-card conversion fees appear reasonable, Sabraw concluded the surcharges undermined the free market because most consumers aren't aware of them.

If consumers knew about the fees, Sabraw reasoned they might look for currency conversion alternatives -- discriminating behavior that could pressure the credit-card companies to lower their fees.

As part of his ruling, Sabraw ordered Visa and MasterCard to better disclose the conversion fees in the future.

The news ticker strikes again! Thanks EscortBiz, interesting article. Wonder if I'll get some of my money back? :1orglaugh

Im not sayin im "glad" - but I like it when some of those bigboys get their ass chewed by the law, when they become to a little to clewer

This is what happens when huge companies are basically being run as a monopoly without much competition to bring out the other companies dirt. I for one think it's a happy day for people all around the world :)

HA. Give me my money back Bitches!!!

this is a bit retarded. the fee is disclosed in the cardholder agreement. by using your card, you agree to everything in the cardholder agreement. it's the equivalent of signing a contract.

Givemoney back fucker ;)

Im praying i get a piece from all that gass i bought up there in 97

visa :321GFY

they'll just find another way to take it out on someone

or tie it up in courts for the next decade....


bastards

The lawyers get another 750 million and we will end up paying for it.

This will be overturned.

:glugglug

Watch out for http://www.preferpay.com/...their conversion fee is 3% of the ammount +pos fee or ATM fee...

while a 1% fee as stated bellow is, let`s say "acceptable", 3% is huge....and a lot of people will get tricked by it...


The case centers on a 1 percent surcharge Visa and MasterCard add to the transaction amount of credit-card charges requiring foreign currency to be converted into U.S. dollars. Concluding Visa and MasterCard have been concealing the conversion fee, Sabraw ordered refunds dating back to 1996.

Agreed 100%