Cork credit union in court dispute with debit card firm
ONE OF the first credit unions to offer debit cards to its members is in dispute over the alleged ending of a deal with a company that provided the card service, the High Court heard yesterday.
DCR Strategies Incorporated, a Canada-based debit and prepaid card provider, wants an injunction preventing Bishopstown Credit Union in Cork, its chief executive Raymond Kenny, and another card provider, Credit Union Services Organisation (CUSO) Ireland Ltd, from using allegedly confidential information in relation to the card service.
The court was told CUSO had been involved in approaching nine other credit unions with a view to setting up debit card systems. About 3,500 of Bishopstown Credit Union’s 22,000 members have a prepaid Mastercard debit card.
Yesterday Gary McCarthy SC, for DCR, said his client was not opposing the issuing of a CUSO-backed card to the credit union’s members but wanted an order preventing CUSO from entering agreements with other credit unions using DCR’s confidential information.
As a result of the information given by DCR to Bishopstown Credit Union, an attempt is being made to set up a card scheme in competition with DCR and giving CUSO an “unfair head start” in the business, Mr McCarthy said.
Bishopstown Credit Union and DCR entered an agreement in June 2008 to provide the Mastercard debit card service, Ms Justice Mary Laffoy was told.
In an affidavit, Frank O’Regan, DCR’s head of European operations, said that when DCR had last year proposed switching the card to Visa after the bank involved sold its card service, the credit union had repeatedly delayed sanction for the change.
Mr O’Regan said he provided a large amount of information in response to the credit union’s queries and later discovered this had been wrongfully disclosed to CUSO and to Mr Kenny.
Mr O’Regan said the result was that CUSO and Mr Kenny obtained commercially sensitive and confidential information and gained unlawful advantage over its competitors, including DCR. At no time did the credit union give valid notice of its intention to terminate the 2008 agreement, he said.
Mr Kenny said there was no commercial benefit to the credit union to enter into a Visa card offering rather than Mastercard. CUSO is offering Mastercard, he said. There was nothing sensitive or confidential about any of this information, which was easily obtainable elsewhere, he said. DCR is “little more than a broker,” he added. The “supposed concern” appeared to be “a ruse” designed to obtain an order compelling the credit union to continue its contract with DCR despite the absence of any legal obligation to do so, he said.
The hearing continues.