U.S. Senator Josh Hawley (R-Mo.) sent a letter to Department of Justice (DOJ) Assistant Attorney General for the Antitrust Division Jonathan Kanter, urging him to block the merger between Capital One and Discover Financial Services.
“This is destructive corporate consolidation at its starkest. If consummated, this merger will create a new juggernaut in the credit card market, with unprecedented powers to extort American consumers. That cannot be allowed to happen,” wrote Senator Hawley.
Yesterday, Senator Hawley condemned the Capital One-Discover merger and also renewed his push to cap credit card interest rates at 18 percent to provide relief for working Americans.
Read the full letter here or below.
February 21, 2024
Jonathan Kanter
Assistant Attorney General
U.S. Department of Justice, Antitrust Division
Main Justice Building, Room 1137
950 Pennsylvania Avenue, NW
Washington, DC 20530
Dear Assistant Attorney General Kanter:
On February 19, Capital One—one of America’s largest and most powerful banks—announced its plans to acquire Discover Financial Services for $35 billion, bringing 300 million Discover card users into its existing fold of 100 million customers. As the Wall Street Journal reported, this merger will create “the third largest credit-card issuer by purchase volume” and “the sixth largest U.S. bank by assets.”
This is destructive corporate consolidation at its starkest. If consummated, this merger will create a new juggernaut in the credit card market, with unprecedented powers to extort American consumers. That cannot be allowed to happen.
It is market competition—meaningful competition—that provides consumers with their strongest defense against a handful of predatory firms. Credit card interest rates are already out of control. Many major card rates recently soared past 30%, and cumulative credit card debt exceeds $1 trillion. That’s why I introduced legislation last year, the Capping Credit Card Interest Rates Act, which would place commonsense restrictions on companies’ ability to burden consumers with these rates. But robust competition in this sector is the most lasting antidote to this problem. And it is precisely that competition which this new proposed merger endangers.
You, in partnership with other regulators, must take the lead in blocking this merger. No doubt a legion of proxies and allies for the financial industry will soon emerge, claiming that this proposed deal will benefit consumers. That is doubtful. If the last several decades of American political economy indicate anything at all, it’s that the supposed benefits of monopoly never trickle down to the public at large. Instead, consolidation redounds to the benefit of shareholders and a handful of top executives—not ordinary Americans. That pattern is poised to play out once again.
I urge you to take the first opportunity available to challenge this bad deal.
Thank you for your consideration.
Sincerely,
Josh Hawley
United States Senator