£14bn legal claim against Mastercard is biggest in British history

Credit card company MasterCard is being sued for £14 billion over claims it overcharged 46 million customers in what is the largest legal claim in British history. The case marks the first major case under a new system for class action lawsuits by multiple claimants. The credit card group is alleged to have imposed fees at an unlawfully excessive level between 1992 and 2008 – so-called “intercharge fees” Walter Merricks, former chief financial services ombudsman, brought the suit on behalf of customers. It was filed by the law firm Quinn Emanuel at theCompetition Appeal Tribunal. It comes in the wake of a 10-year legal dispute between the company and theEuropean Commission that finally ended in 2014 with the European Court of Justice ruling that the fees charged for cross-border transactions were excessive. In a statement Quinn Emanuel said: “MasterCard lost this battle at every level and showed complete disregard for its cardholders and consumers at large, focusing instead on generating unlawful profits.” Mr Merricks added: “The filing of this claim is the first step towards consumers obtaining compensation for what MasterCard did. “MasterCard charged billions of pounds of unlawfully high fees for its sole benefit and to the detriment of consumers. It has already been found to have broken competition law, the basis of which was to protect consumers, and that cannot be disputed. “There is no basis upon which MasterCard can contend that its card fees were not unlawful.” He explained that because of the ECJ ruling, the claim required only to prove that consumers incurred losses as a result. Under the Consumer Rights Act 2015, anyone who incurred a loss is automatically eligible for compensation unless they choose to opt out. Quinn Emanuel partner, Boris Bronfentrinker, said: “Despite criticising this action publicly in July and further insulting consumers by referring to the UK’s new collective action regime as ‘unfortunate’, MasterCard has since turned over evidence that allows us, even at this early stage, to robustly value the claim at £14bn. “They are now preparing for a tough legal battle which we estimate will go to trial in 2018 unless they are prepared to make UK consumers a fair settlement offer before then.” MasterCard said: “Now that the claim has been filed, we will take time to review it in detail, however we continue to firmly disagree with the basis of this claim and we intend to oppose it vigorously. “We deliver real value through the benefits of security, convenience and consumer protection, and we are committed to investing in our payment services in order to continue to meet the rapidly evolving needs of all our customers.”