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October 13th, 2011
Congressional Progressive Caucus Co-Chair Grijalva Calls for Attorney General Investigation Of Anti-Trust Activity By Largest Banks

Washington, D.C.– Rep. Raúl M. Grijalva, the co-chair of the Congressional Progressive Caucus (CPC), today called for Attorney General Eric Holder to investigate whether the nation’s largest banks are quietly working together to increase fees for consumers, which would violate federal anti-trust laws. The call comes as Americans nationwide are hit with new debit card fees by Bank of America, J. P. Morgan Chase, Wells Fargo and other institutions.

“Americans aren’t money trees to be held upside down and shaken until there’s nothing left,” Grijalva said. “We instituted the Dodd-Frank banking law last year because banks are running rampant and squeezing families out of every penny. Now that those rules are going into effect, big bankers are trying to find new and potentially illegal ways to keep squeezing. We need a fair market for banking services in this country, and if the big banks work together to raise fees at the same time, that’s the opposite of choice and competition.”

Grijalva signed a letter calling for the investigation with Reps. Peter Welch (D-Vt.), CPC co-chair Keith Ellison (D-Minn.), John Conyers (D-Mich.) and Mike Honda (D-Calif.) and released it at a press conference this morning in the U.S. Capitol.

The full text of the letter, which highlights banking industry statements that have attracted congressional attention, is below. Rep. Grijalva’s letters, oversight documents and select correspondence are available at


The Honorable Eric Holder

United States Attorney General

U.S. Department of Justice

950 Pennsylvania Avenue, NW

Washington, DC 20530


Dear Attorney General Holder:

We urge you to immediately open an investigation to determine whether banking trade associations and/or individual banks have violated antitrust laws.  Specifically, we are concerned that communications between banks and bank associations that may amount to price signaling or collusion have occurred in the wake of Congressional action to reform debit card swipe fees. 

As you are well aware, Visa and MasterCard are the two dominant card networks that set pricing for thousands of banks across the country.  The result is that banks which normally compete agree not to do so when it comes to swipe fee prices and instead accept fees centrally determined by Visa and MasterCard. 

This collective pricing activity is harmful to competition, raises serious legal questions, and has led to consumers and merchants in the United States earning the dubious honor of paying the highest credit card swipe fees in the world.  American businesses of every size have seen swipe fees rise faster than any other expense in the last decade – growing faster even than health care costs.

It appears that banks are seeking to justify fee increases after Congress and the Federal Reserve Board recently limited banks’ ability to collude with networks to set debit interchange fees.  Statements made by individual banks and their trade associations raise questions about whether some price increases that have occurred this year have actually been coordinated. 

The statements that caught our attention include:

·         “‘What do we do to offset the loss of revenue?’ Wells Fargo CEO John G. Stumpf asked colleagues in London on Monday. ‘Unfortunately, the consumer will pay.’ According to the American Banker, Wells Fargo may increase minimum balances, charge money for debit cards and dump free checking so it can recoup about $1.3 billion in losses stemming from Mr. Durbin’s needless meddling.”  The Washington Times, May 26, 2011 (available at

·         “Wells Fargo (NYSE: WFC) will consider adding fees and increasing current fees in the event that the Durbin Amendment goes into law as scheduled, according to Wells Fargo Chairman and CEO John Stumpf during the Barclays Capital Americas Select Conference in London.”  MyBankTracker, May 26, 2011 (available at

·         “‘The only options left will be to shift these costs to consumers or cease providing debit cards,’ said ABA President Frank Keating.”  Center for Public Integrity, May 4, 2011 (available at

·         “‘Free checking is going to be gone,’ said Independent Community Bankers Association President Jerry C. Walker. ‘You can kiss that away. If you want a debit card, there are going to be (extra) fees.’”  TMCNet, May 8, 2011 ( available at

·         “Now, the industry must regroup and each and every one of you must decide how you are going to pay for the use of debit cards.  It may be through a monthly fee; it may be by using a “prepaid” card as opposed to a debit card; it may be that there is a way to not offer retailers instant credit for the transactions, limiting the amounts that can be charged, etc.  I would also think you will be considering not paying for debit card fraud like many of you have been for a long time.”  Email from Texas Bankers Association to its Members in response to U.S. Senate vote to defeat the Tester-Corker Amendment, June 8, 2011 (attached for your reference).

These statements are just a sampling of the statements made by bankers this year.  Bank officials made similar statements during Congressional consideration of the Credit CARD Act and when bank overdraft fees were regulated.  There is clearly no problem with banks making independent business decisions based upon the landscape as they see it.  Antitrust issues are raised, however, if they are attempting to facilitate group decisions on their prices, terms and conditions.

Actions taken by Bank of America (BOA) earlier this week highlight our concern and demonstrate that immediate scrutiny of additional anticompetitive pricing practices by banks is in order.  Specifically, BOA announced it will begin charging customers a $5.00 monthly fee to use their debit cards.  We are concerned that BOA’s announcement may be a reaction to, and participation in, price signaling or collusion that has occurred among and between banks and bank associations. 

Again, General Holder, We urge you to immediately open an investigation into this matter and look forward to your prompt response.

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