Overturning a proposed debit interchange cap on legal grounds may set a precedent against exempting credit unions from future regulations that affect large banks and other financial institutions.
That possibility exists because TCF National Bank, the financial institution that has sued the Federal Reserve over the proposed debit interchange rule, has based part of its argument against the rule on the small-issuer exemption included in the rule's authorizing legislation.
The legislation mandating the cap sought to exempt debit card issuers with under $10 billion in assets from having to comply with the cap. In its most recent brief in the case, TCF argued that the exemption renders an already confiscatory law unjust as well as unconstitutional.
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