The United Kingdom has fined five payment companies, including Mastercard, $45 million for ‘cartel behavior’. The $42 million portions of the fine were issued to Mastercard.
The United Kingdom today imposed a hefty fine on five different payment companies, including financial giant Mastercard. The companies fined by the country’s Payment Systems Regulator (PSR) were providing prepaid cards to people in the five countries, including homeless people, abuse victims, and asylum seekers. The reason for the fine was ‘cartel behavior’.
The five payment companies for which the fine was issued agreed not to fight each other’s customers over prepayment cards issued by local governments to those in need, according to the agency. So these five companies were protecting their own customers with their agreements and not competing for each other’s customers.
A total of $45 million in fines were issued:
The five companies found to have broken competition laws were Mastercard, allpay, Advanced Payment Solutions, Prepaid Financial Services, and Sulion. It fined the five companies a total of 33 million pounds, or about $45 million. The largest slice of the penalty pie belonged to Mastercard. The fine imposed on Mastercard alone amounted to 31.6 million pounds (about $42 million).
“This investigation and the significant penalties we have imposed send a clear message that PSR has zero-tolerance for cartel behavior,” PSR president Chris Hemsley said in a statement about the punishment. Hemsley also explained how the deal between the five companies affected the market:
“This situation is especially serious because illegal cartel behavior meant there was less competition and options for local authorities. This means that they may have missed out on cheaper or better quality products used by the most vulnerable people in society.”
All five companies admitted to breaking the law and signed with PSR.