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• The Boston Herald reports that a Massachusetts superior court jury has awarded a former Wal-Mart pharmacist $2 million in a case that had the woman, Cynthia Haddad, suing for gender discrimination.

According to the Herald, “Haddad argued she lost her job after fighting for a $1 per hour raise - the same bump given to fellow male managers in the Pittsfield pharmacy. She was earning $43.25 per hour at the time while filling in as manager.

“Haddad said she also sued to win her good name back after Wal-Mart accused her of leaving the pharmacy unsupervised and allowing a pharmacy technician to fill a prescription. Her lawyers called the charges trumped up.”

Wal-Mart said in a statement that it disagreed with the jury’s conclusion but has not decided whether to appeal.

• The New York Times, in a follow-up to yesterday’s stories about Wal-Mart’s decision to open one thousand Wal-Mart Money Centers by the end of next year, facilities that will “assist customers who are outside mainstream banking with convenient, nationwide access to low-cost money services, including check cashing, money orders, bill payment and money transfers,” notes that “the moves are seen as a precursor to even wider offerings, like mortgages and home equity loans, which could turn Wal-Mart into a significant force in the banking world.

“Jane J. Thompson, the president of Wal-Mart financial services, called the prepaid cards and money center services ‘foundational products’ that the retailer would build upon. ‘Our concept is to go up the credit ladder of financial services,’ she said in an interview.”

Wal-Mart apparently is able to do an “end run” around the federal Deposit Insurance Corporation (FDIC) and the politicians who opposed its banking aspirations because it is using third-party partners to offer the services. But, as the Times notes, this may just be a technicality: “Given Wal-Mart’s penchant for squeezing costs out of every business it enters — from changing oil to dispensing prescription drugs — the move is expected to jolt the financial services industry.”
KC's View:
The financial services community, of course, is saying “we told you so,” and is decrying the Wal-Mart moves.

I suspect that there could be some Congressional attempt to take action against non-banks offering financial services through third parties, but I have no idea if such attempts could be successful. But it would be unlike the Congress not to make some noise about Wal-Mart’s “end run.”

In the end, it will be interesting to see what impact Wal-Mart’s moves have on competition within the banking industry.