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Wal-Mart Sues Visa For $5 Billion For Rigging Card Swipe Fees

Soulskill posted about 5 months ago | from the poor-beleaguered-wal-mart dept.

Businesses 455

Hugh Pickens DOT Com writes: "Reuters reports that Wal-Mart has sued Visa for $5 billion, accusing the credit and debit card network of excessively high card swipe fees. Wal-mart is seeking damages from price fixing and other antitrust violations that it claims took place between January 1, 2004 and November 27, 2012. In its lawsuit, Wal-Mart contends that Visa, in concert with banks, sought to prevent retailers from protecting themselves against those swipe fees, eventually hurting sales. 'The anticompetitive conduct of Visa and the banks forced Wal-Mart to raise retail prices paid by its customers and/or reduce retail services provided to its customers as a means of offsetting some of the artificially inflated interchange fees,' says Wal-Mart in court documents. 'As a result, Wal-Mart's retail sales were below what they would have been otherwise.' Interchange fees, the industry term for card-swipe fees, have been a major point of contention between retailers and banks. The fees are set by Visa and other card networks and collected by card-issuing banks like J.P. Morgan Chase & Co. Retailers have argued that the fees had been set too high due to a lack of competition with the two payment industry giants.

Wal-Mart also took a shot against Visa over payment card security. Data breaches last year at Target Corp., Neiman Marcus and others have drawn attention to the country's slow adoption of card technology that uses computer chips and PIN numbers and is seen as less susceptible to fraud than the current system of magnetic stripes. 'Wal-Mart was further harmed by anti-innovation conduct on the part of Visa and the banks,' says the lawsuit, 'such as perpetuating the use of fraud-prone magnetic stripe system in the U.S. and the continued use of signature authentication despite knowledge that PIN authentication is more secure, a fact Visa has acknowledged repeatedly.'"

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Walmart employees, rejoice! (5, Funny)

K. S. Kyosuke (729550) | about 5 months ago | (#46601493)

Because if Walmart wins, they will surely use the money to raise your meager wages instead of buying the CEO a new yacht.

Re:Walmart employees, rejoice! (5, Interesting)

CajunArson (465943) | about 5 months ago | (#46601515)

Bitch about Walmart employees all you want, but if you want to see a perfect model of a *NON* flashy HQ and *NON* flashy executives who practice what they preach, then Walmart is a perfect example of how to do things.

Re:Walmart employees, rejoice! (2, Insightful)

Anonymous Coward | about 5 months ago | (#46601561)

I am sure they practice giving themselves minimum wage. link [wikipedia.org]

Re:Walmart employees, rejoice! (5, Interesting)

alen (225700) | about 5 months ago | (#46601773)

yeah, meanwhile all the heroic family owned businesses in NYC are fighting a new proposed law to give employees at any business with more than 5 employees 5 paid sick days per year separate from vacation days

and i hear they all offer at least some health, pension benefits and the ability to be promoted into management of the family business

Re:Walmart employees, rejoice! (0)

Anonymous Coward | about 5 months ago | (#46601883)

How dare they get decent treat and compensation for their time and energy. Those stupid plebs should be thankful to have a job, let alone sick days. People these days, who do they think they are, CEOs?

Re:Walmart employees, rejoice! (0)

Anonymous Coward | about 5 months ago | (#46601939)

yeah, meanwhile all the heroic family owned businesses in NYC are fighting a new proposed law to give employees at any business with more than 5 employees 5 paid sick days per year separate from vacation days

Ah yes, the old Starving Children in Africa argument.

Re:Walmart employees, rejoice! (5, Informative)

Dcnjoe60 (682885) | about 5 months ago | (#46601941)

yeah, meanwhile all the heroic family owned businesses in NYC are fighting a new proposed law to give employees at any business with more than 5 employees 5 paid sick days per year separate from vacation days

and i hear they all offer at least some health, pension benefits and the ability to be promoted into management of the family business

Walmart is no longer a family owned business. It is one of the worlds largest publicly traded companies. It's been a long time since Sam Walton and his values ran Walmart. As for benefits, they have been charged, repeatedly, about how they intentionally hold rank and file employees below the hours needed to qualify for benefits. So, if they have those great benefits that you list, it's not for the majority of the employees of the largest employer in the US.

Customers may benefit... maybe (5, Insightful)

sjbe (173966) | about 5 months ago | (#46601527)

Because if Walmart wins, they will surely use the money to raise your meager wages instead of buying the CEO a new yacht.

Raise wages? Probably not. Lower prices? Very possibly. Walmart competes primarily on price so anything they can do to lower costs tends to get at least partially passed on to customers in order to keep their competitive advantage. A lot of companies would pocket the savings but in this particular instance it might actually end up benefiting customers.

Plus Walmart beating up Visa on price is almost certainly going to benefit consumers in the long run and Walmart is big enough to actually succeed. The cost of credit card swipe fees gets rolled into the prices we pay for products so if they get lowered at least some of that money will flow through to us as end customers. Not all of course but definitely some.

Re:Customers may benefit... maybe (0)

Anonymous Coward | about 5 months ago | (#46601603)

...lower costs tends to get at least partially passed on to customers...

Including my taxes to cover their worker's government assistance.

...might actually end up benefiting customers.

I'd rather pay more up front and have my taxes be put to better use elsewhere. Pay them a living wage already, FFS.

Re:Customers may benefit... maybe (4, Insightful)

Dcnjoe60 (682885) | about 5 months ago | (#46601967)

...lower costs tends to get at least partially passed on to customers...

Including my taxes to cover their worker's government assistance.

...might actually end up benefiting customers.

You shouldn't have to do either. Walmart could pay a just wage. Of course that would lower dividends paid to shareholders. So, think of paying higher taxes because many Walmart workers needing assistance as another government transfer payment - from you to Walmart's shareholders.

I'd rather pay more up front and have my taxes be put to better use elsewhere. Pay them a living wage already, FFS.

Re:Customers may benefit... maybe (5, Interesting)

Fulminata (999320) | about 5 months ago | (#46601625)

Wal-Mart competes primarily on the illusion of price through loss leaders on a minority of items. The majority of their stock is actually the same or more expensive than many of their competitors. The company's actual strengths are logistics and marketing.

Re:Customers may benefit... maybe (5, Insightful)

MightyYar (622222) | about 5 months ago | (#46601729)

I'd add that they also maintain this illusion by sometimes (often?) selling similar-but-inferior products. For instance, a vacuum that is identical to a top-rated cordless vacuum, but with a smaller motor and battery. If you run through there with a bar code scanner on your phone you can see just how many of the products are actually different than the ones available through Amazon and friends.

Re:Customers may benefit... maybe (5, Informative)

Dcnjoe60 (682885) | about 5 months ago | (#46602023)

I'd add that they also maintain this illusion by sometimes (often?) selling similar-but-inferior products. For instance, a vacuum that is identical to a top-rated cordless vacuum, but with a smaller motor and battery. If you run through there with a bar code scanner on your phone you can see just how many of the products are actually different than the ones available through Amazon and friends.

They are notorious for advertising they will meet any advertised price for the same product. The problem is that many of their products, while similar, are only a model that Walmart sells, at least in electronics.

Re:Customers may benefit... maybe (4, Interesting)

ShanghaiBill (739463) | about 5 months ago | (#46601735)

Wal-Mart competes primarily on the illusion of price through loss leaders on a minority of items. The majority of their stock is actually the same or more expensive than many of their competitors.

Citation? There is a Safeway, Lucky's, and Wal-Mart equidistant from my house. I went to all three and priced out a typical cart of groceries, and Wal-Mart was significantly cheaper on EVERY SINGLE ITEM. Overall, I save about 20% by shopping there.

Re:Customers may benefit... maybe (1)

mrscorpio (265337) | about 5 months ago | (#46601747)

If you're east of the Rockies, you should check out ALDI, even cheaper than Wal-Mart and a lot of high quality items (even if the brands are different at times; often made by the same company).

Re:Customers may benefit... maybe (3, Informative)

Fulminata (999320) | about 5 months ago | (#46601807)

Citation here: http://www.businessinsider.com... [businessinsider.com]

Re:Customers may benefit... maybe (4, Interesting)

ShanghaiBill (739463) | about 5 months ago | (#46602069)

Citation here:http://www.businessinsider.com... [businessinsider.com]

If you drill down to the actual study, what they found was that Target was cheaper than Wal-Mart by 0.46% for ONE MONTH. The preceding months, Wal-Mart had been cheaper by over 2%. So this was apparently a blip caused by some one-off sales at Target.

Re:Customers may benefit... maybe (5, Informative)

sjbe (173966) | about 5 months ago | (#46601743)

Wal-Mart competes primarily on the illusion of price through loss leaders on a minority of items.

There is a huge amount of publicly available research that proves that what you claim is not true. On a randomly chosen basket of goods, Walmart most of the time is the lowest price option. Not always but often enough that statistically speaking they have an advantage. They built their entire business model on low prices and the systems required to support them. Their lead is not huge but it definitely is there. The primary reason companies like Kmart have had so much trouble is that they are competing on price with Walmart when Walmart's prices are lower and pretty much everyone knows it.

The company's actual strengths are logistics and marketing.

Logistics yes, marketing no. Logistics is only an advantage in retail if you can lower costs and thus prices as a result. And marketing? Nobody is dazzled by Walmart's marketing. People go there because they sell stuff for cheap prices. It's certainly not for the shopping experience. Walmart demonstrably competes on price and always has. They also have the advantage of having a lot of their stores in small towns where there really isn't room for a competitor to come in and displace them. Their scale allows them to negotiate prices in a pretty brutal fashion with suppliers. I have close friends whose job it is to sell to Walmart and it isn't a fun experience. They take some pretty significant measures to keep costs low because their ability to keep their advantage is entirely rooted in price.

Re:Customers may benefit... maybe (1)

coastwalker (307620) | about 5 months ago | (#46601959)

That is what the guy just said - Walmart competes on marketing - meaning that they dont tax everything they sell to spend on harvesting the morons who respond to advertising.

Re:Customers may benefit... maybe (2, Informative)

kilfarsnar (561956) | about 5 months ago | (#46602039)

The company's actual strengths are logistics and marketing.

Logistics yes, marketing no. Logistics is only an advantage in retail if you can lower costs and thus prices as a result. And marketing? Nobody is dazzled by Walmart's marketing. People go there because they sell stuff for cheap prices.

And how do they know that Walmart is the place to go for low prices? How have they solidified themselves in the public mind as the low-cost leader? Marketing!

Re:Customers may benefit... maybe (0)

Anonymous Coward | about 5 months ago | (#46601757)

Wal-Mart competes primarily on the illusion of price through loss leaders on a minority of items.

Cite?

I can tell you that's not true where I live. We price compare pretty aggressively, and it's fairly rare that Wal-Mart's prices are higher, and pretty common that they're lower, at least when compared with other retailers. We do end up shopping elsewhere quite a bit because the nearest Wal-Mart is in a county with higher sales taxes, which eats up the difference, but that's not Wal-Mart's fault (other than I always wonder why they didn't build the store a mile down the road... someone screwed up, I'm guessing).

Re:Customers may benefit... maybe (2)

Dcnjoe60 (682885) | about 5 months ago | (#46601997)

Wal-Mart competes primarily on the illusion of price through loss leaders on a minority of items. The majority of their stock is actually the same or more expensive than many of their competitors. The company's actual strengths are logistics and marketing.

This is essentially correct. When a new Walmart opens, that store operates at a loss with really low prices. Then after the consumer base has built up and other competition reduced, prices start rising until they are not significantly lower than that of their competition. They still use loss-leaders to get people in the store, but, they are no less expensive than the rest of the mega market stores.

Re:Customers may benefit... maybe (2)

Jaysyn (203771) | about 5 months ago | (#46601651)

And because Wal-Mart's a horrible corporate "citizen", *we* get to make up the wage difference for their employees in the form of food stamps & other government assistance.

Re:Customers may benefit... maybe (0)

Anonymous Coward | about 5 months ago | (#46601769)

And because Wal-Mart's a horrible corporate "citizen", *we* get to make up the wage difference for their employees in the form of food stamps & other government assistance.

So maybe *we* need to quit subsidizing failure.

Re:Customers may benefit... maybe (1, Interesting)

ShanghaiBill (739463) | about 5 months ago | (#46601815)

And because Wal-Mart's a horrible corporate "citizen", *we* get to make up the wage difference for their employees in the form of food stamps & other government assistance.

If they raised wages, we would have to pay more on food stamps, because they would hire different people, and their current employees would likely be unemployed. Have you ever been to Wal-Mart? My local store employs a woman in a wheelchair, and two people that appear to have Down's Syndrome. Most of their other employees don't look much brighter. These people get paid $10 per hour because that is what they are worth. If Wal-Mart is forced to raise wages, then they will pull more capable people from other more useful employment, and their current employees would get pink slips.

Re:Customers may benefit... maybe (1, Interesting)

Jaysyn (203771) | about 5 months ago | (#46601991)

That is some really specious logic there. The odds are those people aren't getting $10 an hour.

"Walmart jobs are poverty-level jobs.
Walmart’s average sale Associate makes $8.81 per hour, according to IBISWorld, an independent market research group. This translates to annual pay of $15,576, based upon Walmart’s full-time status of 34 hours per week. This is significantly below the 2010 Federal Poverty Level of $22,050 for a family of four."

http://makingchangeatwalmart.o... [makingchan...almart.org]

Also, any company can get a tax break for hiring disabled folks. The Publix down the street from me has at least two people working there with Downs & I'd bet dollars to donuts they are getting paid a living wage.

Re: Customers may benefit... maybe (0)

Anonymous Coward | about 5 months ago | (#46602083)

I really wish people would stop with the assumption that every possible job out there must support a family of four as the sole income source.

Re:Customers may benefit... maybe (1)

careysb (566113) | about 5 months ago | (#46602089)

And because Wal-Mart's a horrible corporate "citizen", *we* get to make up the wage difference for their employees in the form of food stamps & other government assistance.

If they raised wages, we would have to pay more on food stamps, because they would hire different people, and their current employees would likely be unemployed. Have you ever been to Wal-Mart? My local store employs a woman in a wheelchair, and two people that appear to have Down's Syndrome. Most of their other employees don't look much brighter. These people get paid $10 per hour because that is what they are worth. If Wal-Mart is forced to raise wages, then they will pull more capable people from other more useful employment, and their current employees would get pink slips.

While there may be a slight element of truth to that I feel that it's more of a corporate management argument. IF the government would raise the minimum wage to a 'living' level then we'd see a slow move away from food stamps. It would also level the low end wage earner playing field and put Walmart (et al) in a position of not being able to lower prices because their employees' salaries are subsidized by taxes (you and me).

Re:Customers may benefit... maybe (4, Insightful)

K. S. Kyosuke (729550) | about 5 months ago | (#46601679)

Raise wages? Probably not. Lower prices? Very possibly. Walmart competes primarily on price so anything they can do to lower costs tends to get at least partially passed on to customers in order to keep their competitive advantage. A lot of companies would pocket the savings but in this particular instance it might actually end up benefiting customers.

I get your point, but I can't wonder how anyone could possibly swallow their "You made our customers poorer, now compensate it by paying damages to us!" with straight face. Not being a US resident, I'll be the first to admit that my awareness of legal happenings in the US is strictly limited, but I was always under the impression that Americans mostly opt for a what is usually called a class action lawsuit whenever something like this becomes public knowledge. The fact that the damages should go to what amounts to a third party is incomprehensible to me.

Re:Customers may benefit... maybe (2)

orlanz (882574) | about 5 months ago | (#46601889)

First, lawsuit damages always mostly go to a third party. Class action lawsuites the actual end users get pennies on the dollar.

And what Walmart is saying is that the extra costs from Visa were maintained through market collusion between competitors (which is illegal in the US). They were forced to artificially inflate their prices to their customers which resulted in reduced sales and direct damage to Walmart.

Re:Customers may benefit... maybe (0)

Anonymous Coward | about 5 months ago | (#46601687)

They are complaining that they didn't make enough money. They won't lower prices. They'll just profit more.

Re:Customers may benefit... maybe (0)

Anonymous Coward | about 5 months ago | (#46601879)

"Plus Walmart beating up Visa on price is almost certainly going to benefit consumers in the long run and Walmart is big enough to actually succeed. The cost of credit card swipe fees gets rolled into the prices we pay for products so if they get lowered at least some of that money will flow through to us as end customers. Not all of course but definitely some."

This is absolutely true. Banks and VISA both make most of their money on fees. As there is push to move to digital cash in the USA, we need to have ways of filling our "digital wallet" without paying fees. Today I can go to the bank and withdraw cash from my account. If I want to use a prepaid VISA, I pay a fee to load the card and the store pays a fee for me to use a card (which, let's face it, gets passed on to me in one form or another). Together these fees can amount to nearly 6% of each purchase, more at smaller retailers. Add the 6%-10% sales tax charged and you've taken a pay cut of up to 16% (well, you've lost 16% of your purchasing power). If you use a credit card, you can add the interest rate to that equation.

Re:Customers may benefit... maybe (1)

Dcnjoe60 (682885) | about 5 months ago | (#46601949)

If they win, why would they lower prices? It is apparent, given their growth during the period in question, that sales continue to increase, meaning people are willing to purchase goods at the higher prices. As such, a much more likely scenario would be to pass the savings on to shareholders instead of consumers.

Low prices is Walmart's business model (0)

sjbe (173966) | about 5 months ago | (#46602001)

If they win, why would they lower prices?

Because that is their business model. If the win they lower prices which diverts more business from Target and KMart and the rest. A lot of shoppers buy primarily on price and go where they are likely to get the best deal. For all the bitching people engage in over Walmart, when push comes to shove they tend to vote for low prices and overlook everything else.

Re:Walmart employees, rejoice! (0)

Anonymous Coward | about 5 months ago | (#46601559)

Actually, they would lower prices on items. Walmart understands that the way they make money is on volume, not markup. If their prices are better than local competitors, they move more volume. More volume means more profit and more jobs.

Re: Walmart employees, rejoice! (0)

Anonymous Coward | about 5 months ago | (#46601635)

More profit doesn't mean more jobs. It means a higher stock price.

Buy (1)

tepples (727027) | about 5 months ago | (#46601669)

If you want Walmart's profits to go to you, buy WMT.

Re:Buy (0)

Anonymous Coward | about 5 months ago | (#46601907)

Unless you work there, because you won't be able to open a stock account, much less actually buy WMT.

Price of WMT? 1 weeks groceries for most of Walmart's employees.

Re: Walmart employees, rejoice! (0)

Anonymous Coward | about 5 months ago | (#46601639)

The curve on volume-profit is just about used up. My experience is that Walmart is so big they simply cannot buy from smaller vendors... And they make no attempts to. Their stores are al basic goods, they have no unique products, no local products, and rising my popular products take at least a year to show up.

Re:Walmart employees, rejoice! (1)

Jaysyn (203771) | about 5 months ago | (#46601677)

More Jobs?

You mean 100 associates per store working 8 hours per week while the taxpayer makes up the difference? I may have slightly exaggerated the numbers, but they are doing this shit as we speak.

Fuck more jobs, these associates need more money.

Re:Walmart employees, rejoice! (1)

JackieBrown (987087) | about 5 months ago | (#46601733)

Walmart in San Antonio typically pays cashiers more than any other non-commissioned store based cashier (with the exception of coscto.)

Re:Walmart employees, rejoice! (1)

Jaysyn (203771) | about 5 months ago | (#46601925)

So? Are they getting enough hours to make a living wage? Wanna make a bet of what percentage of those cashiers are on some form of assistance?

"Walmart workers make, on average, $8.81 per hour, which, according to MIT’s “Living Wage Calculator,” does not qualify as a living wage for a single person in much of the country, and is not a living wage for a single parent with one child anywhere, including Bentonville, Arkansas, the home of Walmart."

http://www.addictinginfo.org/2... [addictinginfo.org]

"Walmart jobs are poverty-level jobs.
Walmart’s average sale Associate makes $8.81 per hour, according to IBISWorld, an independent market research group. This translates to annual pay of $15,576, based upon Walmart’s full-time status of 34 hours per week. This is significantly below the 2010 Federal Poverty Level of $22,050 for a family of four."

http://makingchangeatwalmart.o... [makingchan...almart.org]

Your San Antonio example, if true, is a huge exception to the rule. Imagine what the national average for Wal-Mart would be without it.

Re:Walmart employees, rejoice! (5, Insightful)

Charliemopps (1157495) | about 5 months ago | (#46601717)

I know everyone likes to hammer on Walmart, but the fact of the matter is I know plenty of people that work at walmart. They have low wage jobs that are typically taken by teenagers and college students but then they have long term employment as well. My aunt started there with no prior experience 30 years ago and made enough to buy a 2 story house and put all of her kids through college as a single mom. Her oldest daughter got a full scholarship from walmart and is now a school teacher. Walmart paid for all of her tuition, her housing and just about all of her expenses. My bests friends wife worked at walmart for 10 years and learned accounting. She now works for the veterans bureau and swears she'd never have gotten the experience required to work there without walmart.

I'm not saying that walmart doesn't have it's problems. But any company that size would. They are not the big bad evil company everyone makes them out to be.

Re:Walmart employees, rejoice! (3, Informative)

sjbe (173966) | about 5 months ago | (#46601955)

I'm not saying that walmart doesn't have it's problems. But any company that size would. They are not the big bad evil company everyone makes them out to be.

Yeah they kind of are the big bad company they are made out to be. Sure they aren't cartoon-character-evil but the choices they have made in how to run their business have some pretty serious negative consequences for which Walmart seems largely unconcerned. I'm not sure I need to repeat the list here but it's not a warm and fuzzy organization.

Re:Walmart employees, rejoice! (1)

Anonymous Coward | about 5 months ago | (#46601783)

For all the ways that Walmart is evil, this is not one of them. They are extremely frugal when it comes to executive perks. I don't know if this policy has changed, but as recently as a decade ago, traveling businessmen had to share hotel rooms. And we're not talking about 5-star penthouses where each person gets their own room. These were motel rooms with two queen beds.

For as fabulously wealthy as the Walton family has become, Sam, and I believe his children as well, do not live lives of opulence, and they expect the same out of the people running the company.

It's been a long time, though, and things may have changed, but they really have tried to keep frivolous spending down across the board.

Re:Walmart employees, rejoice! (1)

certain death (947081) | about 5 months ago | (#46601979)

You obviously have never been to Northwest Arkansas and seen some of the Walton family homes...I call bullshit...I have seen them.

Re:Walmart employees, rejoice! (1)

kilfarsnar (561956) | about 5 months ago | (#46602115)

For all the ways that Walmart is evil, this is not one of them. They are extremely frugal when it comes to executive perks. I don't know if this policy has changed, but as recently as a decade ago, traveling businessmen had to share hotel rooms. And we're not talking about 5-star penthouses where each person gets their own room. These were motel rooms with two queen beds.

Considering the profits made by this company, that actually makes them look worse in my eyes.

Clash of the Titans (5, Funny)

NotDrWho (3543773) | about 5 months ago | (#46601499)

When one huge evil corporation attacks on another huge evil corporation for being evil, does it cause a rip in space time?

Re:Clash of the Titans (5, Funny)

rst123 (2440064) | about 5 months ago | (#46601517)

I don't know about a rip in space time, but walmart's popcorn sales should go up.

Re:Clash of the Titans (2)

oodaloop (1229816) | about 5 months ago | (#46601551)

When two elephants fight, it's the grass that wins!

Re: Clash of the Titans (1)

Anonymous Coward | about 5 months ago | (#46601609)

It's the grass that loses either way.

Re:Clash of the Titans (0)

Anonymous Coward | about 5 months ago | (#46601803)

When one huge evil corporation attacks on another huge evil corporation for being evil, does it cause a rip in space time?

Hopefully the spacetime rip is localized to the courthouse and only affects the lawyers for Visa and Wal-Mart.

Bitcoin (0, Offtopic)

zerosomething (1353609) | about 5 months ago | (#46601509)

That would fix it.

Re:Bitcoin (4, Interesting)

CastrTroy (595695) | about 5 months ago | (#46601555)

Bitcoin might be a bit extreme, as most of their customers have no idea what it is, but why not encourage customers to use cash then? Make some checkout lines cash only. If you want to pay with Visa, you get the slow line. Give customers a cash discount. Visa tries to make people not pay extra for using their card, but I've seen plenty of businesses get around the rules by offering cash discounts.

Re:Bitcoin (1)

rmdingler (1955220) | about 5 months ago | (#46601785)

When and if Walmart and Amazon accept the Bitcoin, it is then a viable currency.

Re:Bitcoin (1)

thaylin (555395) | about 5 months ago | (#46601829)

Discounts for cash, or also charging more for using credit/debt is illegal is many states.

Re:Bitcoin (1)

ub3r n3u7r4l1st (1388939) | about 5 months ago | (#46601897)

If i remember correctly that kind of law were thrown out by the supreme court because of anti-trust violations. Further more, local merchants (especially in ethnic neighborhoods) have already giving discounts (by waiving sales tax and credit card fees) if you pay in cash.

Bitcoin (2)

lagomorpha2 (1376475) | about 5 months ago | (#46601585)

I was thinking the same thing, install an experimental "bitcoin checkout line". It would probably be too confusing for 99%+ of their customers though.

Wi-Fi in the store (1)

tepples (727027) | about 5 months ago | (#46601723)

Bitcoin payments in the store would require Wi-Fi in the store, which is something with which our local Walmart has experimented but which it ended up terminating. Or it would require pairing the user's tablet to the register's Bluetooth transceiver each time, which might work for a dedicated kiosk to exchange BTC for gift cards but could hold up the queue of guests if used for actual groceries.

Re:Wi-Fi in the store (1)

lagomorpha2 (1376475) | about 5 months ago | (#46601827)

"a dedicated kiosk to exchange BTC for gift cards but could hold up the queue of guests if used for actual groceries."

Actually that's not a bad idea. Offer refillable gift cards online or at the Customer Service desk at a discount if bought with bitcoins that way people don't slow down the checkouts.

Re:Bitcoin (0)

Anonymous Coward | about 5 months ago | (#46601817)

And by "fix it" you mean "make it infinitely worse" ?

It's about time (4, Insightful)

egarland (120202) | about 5 months ago | (#46601525)

This is, and has long been, a huge ripoff. I'm rather sure that Walmart doesn't pay the full 3% that Visa/MasterCard like to charge for transactions, but when you look at the overhead of transactions in the cryptocurrency markets, you can see how ridiculously overpriced the credit card transactions are. The costs here are near 0, and so should the charges be, but the system is carefully crafted to avoid competition, and that's illegal.

Re:It's about time (2)

CastrTroy (595695) | about 5 months ago | (#46601591)

Well, there's no point in signing up for a payment card that you can't use anywhere. I have enough cards in my wallet. It's really hard to break into the credit card and payment market at this point, because for anybody, retailer or customer, you have to reach critical mass before it becomes useful. PayPal was able to sneak in because the credit card companies were completely ignoring the need for individuals and very small businesses to collect credit card payments.

Cost of transaction processing (5, Interesting)

sjbe (173966) | about 5 months ago | (#46601649)

I'm rather sure that Walmart doesn't pay the full 3% that Visa/MasterCard like to charge for transactions

No, they don't in a lot of cases but the amount they do pay is VERY substantial. We're literally talking about billions of dollars here no matter what exact amount Walmart pays.

but when you look at the overhead of transactions in the cryptocurrency markets, you can see how ridiculously overpriced the credit card transactions are. The costs here are near 0, and so should the charges be

The cost of credit card transactions are nowhere near zero. Transaction processing in any form is not cheap, even at high volumes. There are significant costs for both on the front end (credit card machines + computers + accounting + banking fees), and on the back end (computers, customer service, accounting, security (yeah, ironic I know), billing, payment transaction costs, marketing, and more). While I agree completely that credit card companies overcharge, the assertion that their costs are anywhere close to zero is not supported by the facts. Building a payment infrastructure like the one Visa has costs many billions of dollars to build and more billions to operate on an ongoing basis.

Furthermore if you are going to make the absurd comparison between bitcoin and credit cards, you need to account for ALL the costs including currency exchange fees, exchange rate risk, opportunity cost, infrastructure cost (which bitcoin lacks), customer service (which bitcoin lacks), counterparty risk (no one is going to give you a refund), accounting, and the rest of them. Once you account for what bitcoin really costs and what it lacks, the cost of it is actually higher in most cases on a risk adjusted basis. (and if you aren't accounting for risk then you are being really really foolish)

Re:It's about time (2)

Triklyn (2455072) | about 5 months ago | (#46601697)

you do understand that purchasing things with a little piece of plastic is not a right right? they offer a service to their customers ie) allow for access and convenience to the customers of those customers. Last I checked, Amex charges a higher rate, but is also still present and profitable.

3 percent is what they charge retailers for being too small to demand something less, getting access to a larger customer pool, giving their customer pool more convenience, and assuming any and all risk associated with buying on credit. one is certainly not precluded from paying for things in cash or check, i believe it is quite common.

Re:It's about time (1)

TheDarkMaster (1292526) | about 5 months ago | (#46601811)

Only 3%? Here in Brazil is 5%. It is the price to pay for living in a country of corrupt and submissive people.

Re:It's about time (1)

misexistentialist (1537887) | about 5 months ago | (#46601893)

Lots of stuff is overpriced, Walmart certainly gets away with selling trash for much more than it's worth. Can the courts tell retailers to set prices closer to their near-zero Chinese production cost? But no one is forced to buy from Walmart, just like Walmart could drop VISA or only accept cash (and EBT). Or, since cryptocurrency is so efficient, it could only accept Bitcoin (applicants for the EBT benefit would be given a Obamarig to mine).

Walmart (0)

Anonymous Coward | about 5 months ago | (#46601541)

Walmart.

One word.

No hyphen.

Walmart.

Name of the company vs. its stores (1)

tepples (727027) | about 5 months ago | (#46601645)

Even after the rebranding, the company's legal name is still "Wal-Mart Stores Inc.". So Wal-Mart the company operates Walmart the store chain.

Re:Name of the company vs. its stores (1)

NatasRevol (731260) | about 5 months ago | (#46601973)

Run by Paul Blart.

Brazil (0)

Anonymous Coward | about 5 months ago | (#46601547)

Has PIN/chip on every credit card now. I brought my US Visa card here and when I hand it over for use some clerks go "huh?"

Re: Brazil (1)

Anonymous Coward | about 5 months ago | (#46602029)

In the UK if you tried it you'd be turned away. We have no fallback.. If your chip doesn't work/is missing you don't have a valid card.

Wal-Mart vs. Visa (4, Funny)

JDG1980 (2438906) | about 5 months ago | (#46601557)

Is there any way they can both lose?

Re:Wal-Mart vs. Visa (1)

Anonymous Coward | about 5 months ago | (#46601653)

Sadly no. But I'm sure they'll figure out a way to make eveyone else lose.

Re:Wal-Mart vs. Visa (1)

BreakBad (2955249) | about 5 months ago | (#46601699)

1%'r rage.

Re:Wal-Mart vs. Visa (2, Insightful)

Anonymous Coward | about 5 months ago | (#46601841)

Yes. By increased government regulation.

Oh, and we lose too.

Chip and PIN (1)

Anonymous Coward | about 5 months ago | (#46601563)

Whilst I know chip and pin is not fool proof, I was shocked to hear the US is still swiping cards for payments!

Re:Chip and PIN (1)

Nimey (114278) | about 5 months ago | (#46601881)

That's going to change next year.

Re:Chip and PIN (1)

ub3r n3u7r4l1st (1388939) | about 5 months ago | (#46601911)

most people in the U.S. use EBT cards which i don't think it will change to chip & pin soon.

PINs (2)

slapout (93640) | about 5 months ago | (#46601573)

"despite knowledge that PIN authentication is more secure"

Visa's probably thinking about all the people who can't seem to remember their PINs and afraid of losing sales from those people.

Re:PINs (2)

Megane (129182) | about 5 months ago | (#46601915)

For what it's worth, there has been a move toward using the billing zip code like a PIN, especially with pay-at-the-pump gasoline. While this is something that would be known to someone who steals your wallet, most of the fraud is likely from magstripe skimming and card numbers sold on the internet.

Someone who skims your stripe isn't going to know your zip code, at least not at a restaurant or faceplated ATM where most of that happens. Also the CVV number is physically kept on the card, but not in a form where it can be automatically read by a skimmer. (At least not until the faceplaters start putting an optical scanner in there too!)

The zip code has the advantage of being something you will know without having to write it down, and the CVV is already written down for you on the card. So there's no worry about forgetting them like with a PIN, or with someone picking a PIN of 1234. And I know they do use them for card security, from the first time I encountered this and entered 55555 instead of my zip code, and got a concerned call from my credit card company.

Of course it helps a lot that in the US, zip codes are all numeric, unlike postal codes in Canada and the UK, so they're easy to enter on a keypad.

Re: PINs (0)

Anonymous Coward | about 5 months ago | (#46602065)

Doesn't affect any other country in the world.. Or are you suggesting only Americans can't remember a 4 digit number?

I wish they'd allow more than 4 digits though.. Apparently the cards support up to 10 but there's no way to set it.

Pot Meet Kettle (1)

Mansing (42708) | about 5 months ago | (#46601587)

Walmart made $13bln US in profits last year ... half of which accrues to the Walton "family."

'The anticompetitive conduct of Visa and the banks forced Wal-Mart to raise retail prices paid by its customers ...

Anti-competitive? Hypocrites.

Re:Pot Meet Kettle (1)

Sprouticus (1503545) | about 5 months ago | (#46602135)

YEa, the anti-competitive comment made me spit tea onto my keyboard. Walmart owes me a new one now...

Walmart cares? (0)

Anonymous Coward | about 5 months ago | (#46601595)

Walmart looking after customers*? Mind blown.

(*shareholders)

lol (1)

slashmydots (2189826) | about 5 months ago | (#46601615)

Maybe Walmart is just being stupid. Did they ever consider that? My swipe fees are zero. I pay $21 flat per month to the processor and then exactly what the card costs so if visa wants 0.8% on a debit card, that's what I pay. Maybe they should have gotten a plan that doesn't suck.

Re:lol (1)

tepples (727027) | about 5 months ago | (#46601745)

Swipe fees on credit cards are generally much higher than on EFTPOS cards.

Re:lol (1)

MachineShedFred (621896) | about 5 months ago | (#46601849)

credit card != debit card

Re:lol (1)

slashmydots (2189826) | about 5 months ago | (#46602091)

I don't pay a swipe fee on either.

Re:lol (2)

NatasRevol (731260) | about 5 months ago | (#46601995)

Did you ever consider that they don't give flat fees to companies where monthly charges can't be paid with a $20 bill and some change?

Re:lol (1)

slashmydots (2189826) | about 5 months ago | (#46602097)

Did you ever considering putting the entire country or world on the same processor is stupider than putting each store on the cheapest one locally?

Conflicted (1)

just_another_sean (919159) | about 5 months ago | (#46601681)

I feel so weird saying this... But, Go Walmart? I guess.

Anyway, as another poster pointed out it's about time someone went after them. Maybe taking 5 billion from them will be a real wake up call.

dark matters render onto series continues (0)

Anonymous Coward | about 5 months ago | (#46601705)

who really pays for all that usury plus the WMD on credit cabals' genocide projects? plus all the stipends for all the crown royal self adulating opulence plus... some still calling this 'weather'?

This is new economy (4, Funny)

tekrat (242117) | about 5 months ago | (#46601779)

Since the middle class has been decimated, this is how business of the future will run... now that they've fleeced the rest of us, big companies will sue other big companies and that's their ticket to profitability and stock price rises.

Somebody needs to continue to fight this (2)

usuallylost (2468686) | about 5 months ago | (#46601871)

The settlement, assuming this article is accurate, includes a broad ligation release that will basically shield the credit card companies from getting sued in the future. So essentially they are giving a token amount to this settlement and getting a huge litigation release that will allow them to continue to screw people essentially forever. I'd opt out of this class if it was me. Walmart, Target and Amazon have all opted out. Hopefully they will all sue individually and force a reasonable outcome this time. Depending upon how this goes Walmart may be doing us all a favor here by trying to force a better settlement.

This is just another example that reinforces my view that class action lawsuits are basically a scam. I have been involved in two where I actually joined the class and in both cases the company being sued and the lawyers came out just fine and the people in the class got pretty much nothing. I had two other instances where I qualified and I just opted out. Not surprisingly those cases also involved making lawyers rich while the people in the class got nothing. In this case the class members are getting next to nothing and giving up a hell of a lot to get it. Can't say I am surprised.

Wal-Mart should apply for food-stamps .. (1)

Anonymous Coward | about 5 months ago | (#46601895)

"Wal-Mart employees are the largest group of .. food stamp [bloombergview.com] recipients"

Re:Wal-Mart should apply for food-stamps .. (1)

ub3r n3u7r4l1st (1388939) | about 5 months ago | (#46601971)

and there is no fee for processing SNAP transactions on EBT cards. (It is illegal to charge sales tax or card processing fees on SNAP transactions)

The same Walmart (0)

Anonymous Coward | about 5 months ago | (#46602131)

which is the biggest benefactor of food stamps in country?"

http://rinf.com/alt-news/latest-news/walmart-admits-profits-depend-poverty/

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