WASHINGTON — A senior Senate Democrat on Thursday blasted Visa Inc. and MasterCard Inc. for threatening to "punish" small banks and credit unions if a measure to change so-called "swipe fee" rules becomes law.

Sen. Richard Durbin of Illinois, the No. 2 in Democratic leadership, sent a sharply worded letter accusing the two credit card firms of deliberately trying to "frighten" small banks and credit unions into lobbying against the measure, which Durbin successfully attached to the Senate financial-overhaul bill.

He also warned Visa and MasterCard that any coordinated action to make changes to their fees and rules to disadvantage smaller banks could trigger federal antitrust investigations.

Durbin is hitting back against Visa and MasterCard during an intense lobbying fight over his amendment. House and Senate negotiators are preparing to reconcile the two chambers' bills. The House version does not address the so-called "interchange" issue, and the financial industry is trying hard to keep it out of the final bill.

Durbin said Visa and MasterCard are deliberately signaling to smaller banks that the credit card giants will change their network rules in order to hurt smaller member banks if Durbin's amendment becomes law.

He stressed that his amendment was crafted to specifically shield smaller institutions from being disadvantaged, including by exempting smaller banks and credit unions from the measure's debit fee regulations.

"The only way that small banks or credit unions could experience interchange rate reductions or be discriminated against is if your companies decide to cut small bank interchange rates and rescind your operating rules that currently prohibit discrimination between card-issuing banks," Durbin wrote. "Sadly, it appears from your companies' public statements and other communications that you are contemplating just such steps."

Durbin asked the two credit card firms to "state unequivocally that you are neither threatening nor planning to take steps that would purposefully disadvantage small institutions, should the amendment become law."

He also warned the companies that if they "coordinate with each other or collude with your largest member banks to make changes to your fees and rules, it would raise serious concerns that you are engaging in an unlawful restraint of trade."

Durbin's measure would allow the Federal Reserve to regulate fees on debit card transactions, as well as allow retailers more leverage in negotiating with credit card firms and banks over the fees for card transactions. It received a strong bipartisan vote in the Senate, with nearly 20 Republicans supporting it.

The vote was a huge win for retailers, who have been fighting for years to win the protections. The potential hit to the banking industry could be huge, as institutions large and small rely on the fee income to boost their profits. The ultimate cost would depend on how the Federal Reserve determines what rate banks would be able to charge merchants for using cards.

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