Mariano’s Debit Card Fees for Cash-Back Transactions Are Unlawful, Class Action Claims

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A proposed class action alleges grocery store chain Mariano’s has unlawfully assessed surcharges on debit card transactions asking for cash back. 

The 18-page complaint filed in Illinois state court alleges the uniform $0.50 cash-back fee imposed by defendant Roundy’s Illinois, LLC, which does business as Mariano’s, is prohibited under the contractual agreement between the grocer and credit card companies, and cannot be charged to consumers even if properly disclosed. 

“It does not matter if the debit card surcharge is properly disclosed to consumers because debit card surcharges are strictly prohibited by all credit card companies,” the complaint reads, claiming Mariano’s imposition of cash-back fees amounts to a violation of the Illinois Consumer Fraud and Deceptive Business Practices Act. 

Each time a consumer uses a debit card to make a purchase at one of Mariano’s 44 Illinois locations and elects to receive cash back, the grocer incurs a processing fee, known as an “interchange fee,” the suit explains. Typically, merchants who accept credit and debit card payments will absorb interchange fees and recoup the costs by charging higher prices for their goods and services, the case relays. 

Some merchants, however, choose to impose a surcharge on transactions in which a consumer opts to get cash back. Although surcharges on credit card transactions are generally permitted, the contractual agreements that allow for such fees prohibit merchants from imposing any surcharge on debit card purchases, including cash-back transactions, the lawsuit says. 

The complaint alleges Mariano’s has concealed and misrepresented the true nature of the cash-back fee it charges on debit card transactions, namely that it was authorized to do so. 

“Defendant intended for Plaintiff and the Class to rely on its deceptive acts and practices is evidenced [sic] by, inter alia, Defendant’s policy and practice of knowingly charging every consumer getting cash back on a debit card a $0.50 debit card ‘Cash Back Fee,’ which is not authorized by Defendant’s Merchant Agreements with Visa,” the lawsuit alleges. 

The case looks to represent consumers nationwide who, within the applicable statute of limitations, paid a cash-back fee, marked as “DEBIT CARD CASHINGNP” on a receipt, to Mariano’s with a debit card. 

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