Miami Courant

Erwin Mosqueda, owner of Top Gun M.O.T. Design Services LLC in Miami, submitted testimony last month in opposition to the so-called “Credit Card Competition Act” (CCCA) currently pending in Congress.

“Small businesses cannot afford legislation that disrupts the systems we rely on and undermines our ability to operate effectively," wrote Mosqueda in his testimony. "I call on Congress to reject the CCCA and protect the efficiency and security of the current credit card payment system that is so crucial to businesses like mine.”

Established in 2018, Top Gun M.O.T. Design Services LLC specializes in creating traffic control plans, and provides services using industry-standard software for clients in construction and transportation sectors.

The CCCA, or S. 1838, originally sponsored by U.S. Sens. Richard Durbin (D-Ill.) and Roger Marshall (R-Kans.), would require banks to offer merchants at least two network options, one of which cannot be Visa or Mastercard, for processing credit card transactions. Opponents to the bill argue that if given the choice, retailers would likely choose cheaper, less secure networks for processing transactions, thereby exposing consumers to increased securities and fraud risks.

Glenn Grossman, the Director of Research at financial advisory firm Cornerstone Advisors, told Federal Newswire earlier this year that the bill could also lead to increased credit card fraud risk. 

“If the CCCA were to be approved, the routing of credit card transactions would move from a ‘single pipe’ to ‘multiple pipes’ of data flowing from merchants to issuers,” said Grossman. “Today, card issuers depend on the networks to profile and identify fraud. They see all the transactions on their network and have developed fraud detection capabilities that would not be possible in a fragmented structure the CCCA would create."

Grossman added that Visa has invested billions on fraud detection.

“The investment builds trust and in return consumers use their credit cards,” said Grossman. "Zero liability means something to consumers. With the CCCA, it is possible that promise is gone."

In a report released in July 2023, “The True Impact of Interchange Regulation: How Government Price Controls Increase Consumer Costs and Reduce Security,” Grossman wrote that studies show 79% of consumers choose credit cards as a payment option because of their data security.

Grossman said that, under the legislation, credit card authorizations would be allowed to flow across many “pipes” which would eliminate much of the “fraud fighting value that Visa and MasterCard have implemented.”

The bill would not require new networks to provide fraud detection, Grossman explained.

The Federal Trade Commission reported receiving 114,348 complaints of fraud in which the payment method was credit card in 2023. Those fraud complaints accounted for $246.1 million.

The FTC also reported receiving 416,582 reports of credit card identity theft in 2023.   

The bill is currently pending before the Senate’s Committee on Banking, Housing and Urban Affairs.