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A third lawsuit over ATM fees accuses three major banks and two payment processors of conspiring to fix fees at the expense of consumers.
The latest lawsuit, filed by a New Jersey man, seeks class-action status and alleges that Bank of America Corp., JPMorgan Chase & Co. and Wells Fargo & Co. took part with Visa Inc. and MasterCard Inc. in a "conspiracy to fix the prices" consumers pay when they use an ATM that's not in their bank's network.
Representatives for the three banks and Visa declined to comment Wednesday.
A representative for MasterCard Inc. said in an emailed statement that the lawsuit is "without merit" and that it will vigorously fight the claims.
The lawsuit says "unlawful agreements" among the banks and payment networks result in inflated fees when consumers use an out-of-network ATM.
A similar lawsuit was filed Monday against MasterCard and Visa on behalf of individuals in California and Washington, D.C. And similar claims were the basis for a lawsuit filed last week against MasterCard and Visa by operators of independent ATMs, which are generally found outside banks in places like convenience stores, gas stations and hotel lobbies.
At the heart of all three lawsuits are the complex, behind-the-scenes negotiations between card issuers and their payment processors.
Most consumers know MasterCard and Visa merely as the logos on their credit and debit cards, but the companies play pivotal roles in the payments universe because they provide the networks that process card transactions. Think of them as the operators of phone lines or wireless networks.
There are smaller payment processors for debit card transactions, such as Star, Nyce and Pulse, which is owned by Discover Financial Services. But MasterCard and Visa are the arena's predominant players.
Even if a card bears a MasterCard or Visa logo, debit cards are equipped to function on more than one payment network. In turn, ATM operators typically tap into the cheapest network available to them to complete a transaction.
The problem, according to the independent ATM operators' lawsuit, is that MasterCard and Visa force ATM operators to charge consumers the same out-of-network fee all the time, even when their cards can access the cheaper networks. That prevents independent operators from offering discounted fees, which they say would increase business from the consumers who now go elsewhere to make withdrawals to avoid steep out-of-network fees.
The lawsuit filed Tuesday also points to the long history between MasterCard, Visa and the banks; the two companies were originally formed by bank associations.
"MasterCard and Visa are the banks' alter egos," said Jonathan Rubin, of Rubin PLLC, which is representing the ATM operators.
In an emailed statement, MasterCard said its policies were "put in place to protect consumers from ATM operators seeking to impose discriminatory surcharges on our cardholders."
All three antitrust lawsuits were filed in U.S. District Court in the District of Columbia and do not seek specific monetary damages.