- US Justice Department files a lawsuit against Visa for turning into a monopoly.
- Visa, Acquired Plaid, which the United States Department of Justice (DoJ) is filing a lawsuit against because they believe it is an illegal activity.
- What makes Visa’s move illegal is that acquiring Plaid means it has attained a monopoly.
US Justice Department against Visa for turning into a monopoly
US Justice Department files a lawsuit against Visa for turning into a monopoly. Visa, bought Plaid, so the United States Department of Justice (DoJ) is filing a lawsuit against it because they believe what they are doing is against the law.
What makes Visa’s move illegal is that acquiring Plaid means it has attained a monopoly. Visa bought Plaid in January 2020.
Sustaining a monopoly results in Visa dominating in the finance sector. Visa is fighting on the opposite side of these claims saying that the move to claim Plaid benefits customers.
A Visa representative said on the Wall Street Journal that Visa is ready to stand firm against the Department of Justice. The Department of Justice said Visa wants to buy Plaid as an insurance policy to limit any danger from affecting the US debit business.
The Plaid acquisition limits Visa’s chances of facing competition. The CEO of Visa noted that its benefits would be that it saves money and can create innovatively for its merchants and consumers.
Plaid built a helpful platform for online financial activity and data. Since January, Plaid has faced several legal cases around customer data negligence.
Last month, the US Justice Department relied on Bain and Company to relay its information on Visa’s move to capture Plaid. Certain monopolies are legitimate but not predator ones.
The lawsuit against Visa states that Plaid had the power to be Visa’s rival in its sector. The Doj’s concern is that monopolizing the debit sector limits its growth.