WASHINGTON, D.C. - A
federal judge has struck down the rule that caps fees banks can charge
merchants for handling debit card purchases.
U.S. District Court
Judge Richard Leon ruled the Federal Reserve doesn't have the authority to set
the limit.
A coalition of retail
groups sued the Fed over its setting the cap at an average of about 24 cents
per debit-card transaction. The previously unregulated "swipe" fee
averaged 44 cents. The Fed initially proposed a 12-cent cap, and the retailers
had argued that the Fed buckled under pressure from bank lobbyists when it set
the cap higher.
The Fed now must craft a new rule. The current one will remain in effect
in the meantime.
