In this April 23, 2018, file photo, the logo for Visa appears above a trading post on the floor of the New York Stock Exchange. Credit: Richard Drew / AP

WASHINGTON — The U.S. Department of Justice has launched an antitrust investigation into Visa Inc.’s practices regarding debit-card transactions.

The department is looking into the network’s rules for routing transactions both in stores and online, according to a person familiar with the matter. Representatives for the Justice Department declined to comment.

“The U.S. Department of Justice has informed Visa of its plans to open an investigation into Visa’s U.S. debit practices” and is cooperating with the department, the company said in a regulatory filing Friday afternoon. “We believe Visa’s U.S. debit practices are in compliance with applicable laws.”

Last year, the department sued Visa to block a $5.3 billion deal the network had signed with Plaid Inc., saying that the combination would further limit competition in the market for online debit-card transactions. Visa and Plaid ultimately abandoned the deal.

Visa shares slumped 6.2 percent to $206.90 Friday, their biggest one-day decline in almost a year. The Wall Street Journal first reported the investigation earlier Friday.

In its suit against Visa last year, the Justice Department said Visa already possessed monopoly power in the market for online debit-card transactions, arguing that roughly 70 percent of such transactions in the U.S. routed over the firm’s network.

At the heart of the Justice Department’s issues with Visa is the 2010 law known as the Durbin Amendment, which requires banks to include two networks on their debit cards. The idea is that merchants are then supposed to be given the choice of routing over a major network like Visa’s or the one run by rival Mastercard Inc. versus a smaller alternative such as Pulse, Star or NYCE. Those alternative networks can be cheaper for merchants.

That system generally works for in-store transactions. The problem, the Justice Department has said, is that Visa has created new technology that makes it harder for online transactions to be routed over alternative networks.

“As a result, merchants do not use PIN networks in any significant volume to process online transactions, and instead pay higher fees to use Visa,” the Justice Department said in its lawsuit last year, referring to the personal identification numbers debit-card customers use when paying.

Merchants’ complaints over their struggle to route online debit-card transactions over alternative networks has only intensified during the coronavirus pandemic, with consumers turning to online shopping in droves. Retailers already spend more than $100 billion a year to accept cards and other electronic payments, an amount that’s swelled in recent years as consumers shifted away from cash, and banks dangled rewards and perks to spur more card usage.

Visa, in its response last year, argued that the Justice Department cherry-picked its definition of the online debit-card market to make it seem like the network holds more power than it does. Visa also said the department’s claim that it doesn’t face real competition from Mastercard was “dubious.”

“Nothing could be further from the truth,” Visa said. “In recent years, Mastercard has convinced numerous banks to switch their debit-card portfolios from Visa to Mastercard and competition has driven down overall pricing on accounts.”

For years, Visa has reported in regulatory filings that the Department of Justice’s antitrust division issued the company a civil investigative demand in March 2012, seeking documents and information tied to its debit-card practices.

“Although it’s not clear what specifically the DOJ might be looking at currently, we believe the threat of regulation has historically proven to be a near-term multiple compressor, as was the case with the Durbin Amendment, but note the financial implications were less impactful,” Daniel Perlin, an analyst at RBC Capital Markets, said in a note to clients.

While Visa hasn’t received a civil investigative demand from the Justice Department yet, it did get a notice to preserve relevant documents, the company said in its filing Friday.

Story by Jenny Surane. Bloomberg’s David McLaughlin contributed to this report.