WASHINGTON - Sounding very much like victims, the top executives at American Express Co. and Morgan Stanley Dean Witter & Co. beseeched a Senate subcommittee for legislation aimed at reigning in Visa and MasterCard, whose practices they portrayed as unfair and monopolistic.

Calling Visa "the ringleader," Morgan Stanley chairman and chief executive officer Philip Purcell complained that the bank card associations charge higher merchant fees than his company's Discover card. "The fact is that merchants have very few options today," he said. "Public policy that discourages the two dominant associations from creating barriers to new entry is a critical way to ensure new network competition and choice for consumers and merchants."

Harvey Golub, chairman and chief executive officer of American Express, took his swipes at the associations' rules that prevent member banks from issuing American Express cards. He pointedly asked for new legislation that would acknowledge that the Gramm-Leach-Bliley Act had left "the job unfinished."

"I want to compliment the Committee on the progress you've made in moving banks toward full competition in a free market," Mr. Golub added, with characteristic wryness. "We're here today to move that process one step further."

Thursday's hearing, which was convoked to address "alleged antitrust violations by Visa and MasterCard," was nothing short of a slugfest. Lawyers for Visa U.S.A. and MasterCard International said that, far from being victims, Mr. Purcell and Mr. Golub ran very profitable companies, whose success showed how competitive and free the market is for credit card issuers today.

"Choices abound," said Noah Hanft, senior vice president and U.S. counsel for MasterCard International. Repeating an argument that the card associations often make, he added, "Anyone with a mailbox knows that this is a highly competitive business. In fact, every consumer who wants an American Express card can get one if American Express is willing to issue it."

The acrimony and animosity that punctuated the hearing were heightened by the fact that the showdown was a prelude to a lawsuit on the same topic that will begin in U.S. District Court in Manhattan on June 7. The Department of Justice has sued Visa and MasterCard for the very complaints that Mr. Golub and Mr. Purcell spoke yesterday - and have voiced repeatedly in the past.

American Express and Discover appeared to have a receptive audience among the handful of senators who attended the hearing. Sen. Charles E. Schumer, D-N.Y., was among those who came down hard on the bank card companies. "The simple fact is that Visa and MasterCard walk like oligopolists and often talk like oligopolists," Sen. Schumer said. "The fact that banks are willing to accept these exclusionary rules in offering Visa/MasterCard is an indication of just how little competition there is in the credit card marketplace."

Injecting humor into an otherwise intense hearing, Sen. Phil Gramm, R-Tex., said he had no doubt that American Express' and Morgan Stanley's motives in seeking partnerships with banks were not about helping consumers. "The people who want to get into the banks are just as greedy as the ones who want to keep them out," he said.

Mr. Gramm said the issue at stake for him is whether Visa and MasterCard, which together control 80% of the card market, should be allowed to tell their member banks that they can't issue a competitor's card. "Why has MasterCard never said you can't carry Visa?" Sen. Gramm asked.

Sen. Bob Bennett, R-Utah, who called for the hearing, said that as Congress debated what to include in the financial services modernization bill - known as the Gramm-Leach-Bliley - "the issue of a legislative initiative to address perceived problems in the credit card industry arose."

Given the timing of the hearing - less than two weeks before the antitrust case - there has been speculation about whether the event came about through the lobbying efforts of American Express and Morgan Stanley.

Sen. Gramm, the Banking Committee chairman, sought to clarify the issue by saying, "We were not sufficiently informed to make a decision" on the credit card industry last fall, when the Gramm-Leach-Bliley act was being crafted. "As a result, I made a commitment, based on the concern being raised at that time, that we would hold hearings" on the credit card industry. This was news to some industry lobbyists.

As part of his presentation, Mr. Purcell showed a videotape of a Visa executive speaking at an industry conference more than 10 years ago. "What you are about to see," Mr. Purcell said, "is not the consumer-friendly Visa that its lawyers and publicists try so hard to portray. Instead, this is the real Visa that Discover, American Express, and retailers have had to deal with since 1985," when the Discover card was first introduced.

The Visa executive on the videotape, addressing an audience of Visa's member banks, talked about "thwarting the efforts" of competitors. She was referring to the then-fledgling Discover card, which was at the time owned by Sears Roebuck & Co. "Other nonbank competitors who are likely sitting on the sidelines will likely think again when they try to follow Sears' lead," she said.

Mr. Purcell subtly chided Visa and MasterCard for failing to produce their chief executives at the hearing. Both companies were represented by lawyers. "I felt that it was important that I appear personally in this proceeding," Mr. Purcell said. "I'm sure the other networks have this same respectful attitude."

A MasterCard spokeswoman, Sharon Gamsin, said in an interview that it would have been inappropriate for MasterCard's chief executive officer, Robert Selander, to appear at the hearing, since he is a witness in the Department of Justice's lawsuit against Visa and MasterCard.

Mr. Purcell also referred to Discover's efforts more than 10 years ago to issue Visa cards, a situation that led to years of litigation between the two companies. Discover ultimately lost the legal battle, which resulted in a Visa rule - bylaw 2.06 - preventing competitors like American Express and Discover from issuing Visa cards. The Department of Justice is attacking this rule.

Mr. Purcell said Visa's bylaw 2.06 "deprived us not only of the ability to issue Visa cards, but also to acquire their transactions directly as a member. We have been stripped of another important component of our business strategy," Mr. Purcell said.

Paul Allen, general counsel of Visa, retorted by saying that Mr. Purcell's comments sounded like "sour grapes." Mr. Purcell "is rehashing litigation that Visa won and Dean Witter lost," a fact Mr. Purcell "can't seem to accept," Mr. Allen said.

Mr. Allen and Mr. Hanft of MasterCard argued that American Express and Morgan Stanley would simply "cherry pick" the best customers if given access to the card associations' brands. Mr. Allen started to explain that Visa and MasterCard are not-for-profit organizations, but Sen. Gramm cut him off. "Do you get a bonus?" the senator asked. "If I'm lucky," Mr. Allen replied. Sen. Gramm then questioned how the associations call themselves not-for-profit. "If Visa's employees get bonuses based on whether they do a good job," how is that different for profit organizations, he asked.

"You want to say if you do business with me, you can't do business with anyone else?" Mr. Gramm said to the card association executives. "Whether you are for-profit or not-for-profit, how does the consumer lose if Amex issues Visa cards?"

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