Justice Dept. Studies Whether Visa Violated Antitrust Laws

The Justice Department is investigating whether Visa U.S.A. violated antitrust laws when it opposed an American Express Co. move to lower credit card interest rates, it was announced Tuesday.

The probe follows complaints to the Administration from several sources, including Rep. Charles E. Schumer (D-N.Y.), a main congressional critic of credit card companies, and Rep. Frank Annunzio (D-Ill.), chairman of a House subcommittee on consumer affairs.

In a letter to Schumer, Assistant Atty. Gen. John Bolton said the department would look into recent conduct by Visa to determine whether it “constitutes a violation of federal antitrust law.”

Mailgram Sparks Complaint

The complaint from Annunzio and Schumer was sparked by a mailgram sent by C. T. Russell, the president of Visa, to the 5,500 banks that offer the card.

Russell asked the institutions to consider steps to protest a decision by American Express to offer a new card with a 13.5% interest rate--substantially lower than the more common rates of up to 19.8%.

He told the banks that the American Express move would be in direct competition with “one of your most profitable lines of service.” Banks “may wish to rethink your position in offering American Express products,” the mailgram said.

Schumer released the letter while testifying Tuesday before a Senate banking subcommittee that is considering legislation that would curb the high credit card interest rates.