Washington, D.C. — Following news that the New York State Attorney General Letitia James has asked the state supreme court to issue new subpoenas as part of an investigation Capital One proposed $35 billion acquisition of Discover Financial Services, the American Economic Liberties Project released the following statement.

“We’re thrilled to see Attorney General James ramp up New York’s investigation into how the Capital One-Discover would limit competition by consolidating over $250 billion in outstanding credit card loans under one corporation,” said Morgan Harper, Director of Policy and Advocacy at the American Economic Liberties Project. “Such concentration poses risks for consumers, particularly subprime borrowers, and small businesses alike. Amid troubling disclosures that the Office of the Comptroller of the Currency (OCC) is trying to thwart New York’s efforts to investigate Capital One-Discover, we urge federal banking regulators instead to use their authority to block this merger.”

The combination of Capital One, a bank and credit card issuer, with Discover — a bank, credit card issuer, and credit card network — would create the sixth-largest U.S. bank by assets and the nation’s largest card issuer by loan volume. Capital One’s purchase of the Discover credit card network, a smaller but important competitor to the Visa-Mastercard card network duopoly, would also allow Capital One to vertically integrate and maximize critical swipe fee revenue at a time when high swipe fees are under Congressional scrutiny.

In September 2024, the Department of Justice Antitrust Division withdrew the 1995 Bank Merger Guidelines and made clear that the 2023 Merger Guidelines, which contain several guidelines that call for scrutiny of this transaction, apply to the banking industry. The DOJ’s announcement came in conjunction with a vote from the Federal Deposit Insurance Corporation (FDIC) to implement stricter guidelines when reviewing bank merges, requiring additional data during a transaction and taking a broader look at the would-be deal’s impact on geographic considerations.

Read the National Community Reinvestment Coalition’s July 2024 comment letter to banking regulators, which Economic Liberties signed on to, here.

Learn more about Economic Liberties here.

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The American Economic Liberties Project works to ensure America’s system of commerce is structured to advance, rather than undermine, economic liberty, fair commerce, and a secure, inclusive democracy. Economic Liberties believes true economic liberty means entrepreneurs and businesses large and small succeed on the merits of their ideas and hard work; commerce empowers consumers, workers, farmers, and engineers instead of subjecting them to discrimination and abuse from financiers and monopolists; foreign trade arrangements support domestic security and democracy; and wealth is broadly distributed to support equitable political power.