New code, backed by NY lawmakers, will help credit card companies track gun purchases

Credit card providers categorize purchases with merchant category codes for different types of retailers. There are unique codes for many kinds of stores and service providers, including sporting goods stores, women’s accessory stores and shops for candy, nuts and confectionery. But until now, there has been no separate code for firearm retailers. Instead, they have typically been grouped into a “miscellaneous” category that also includes party supply stores and sunglasses shops, or a “durable goods” category that also tracks purchases at stores specializing in gas lighting fixtures and musical instruments, according to a Mastercard reference booklet.

Supporters of a new code argue it could flag to detect large purchases of firearms and ammunition, which could be trafficked or used in mass shootings. Second Amendment advocates, on the other hand, worry it could invade people’s privacy or prevent people from legally purchasing guns.

To create new codes, financial institutions have to make their pitch to the International Organization for Standardization, which brings together business leaders from around the world to set different regulatory measures, including merchant category codes. Major credit card companies have seats at the table.

The campaign to use this little-known financial tool to target gun violence has been years in the making, stemming from the efforts of New York-based Amalgamated Bank, which refers to itself as “America’s socially responsible bank.” The bank submitted an application to the standards group in 2021 to create a firearm and ammunition store code, without success. This year, it tried again.

Amalgamated received notification that the code had been approved early this morning.

“Once implemented, the new merchant category code for gun stores will save lives by stemming the flow of guns to the black market and giving law enforcement information that could prevent mass shootings,” Maura Keaney, Amalgamated’s first vice president, said in a statement.

Now that the International Organization for Standardization has approved Amalgamated’s application, it will be up to individual financial institutions to decide if they want to use it. Otherwise, they can continue to lump gun dealers into the “miscellaneous” and “durable goods” categories.

American Express said in a statement that it will follow its “usual business practices” to determine how to meet its “regulatory and fiduciary responsibilities.” Mastercard said it is looking into how merchants and banks will implement the new code “to support lawful purchases on our network while protecting the privacy and decisions of individual cardholders.” Visa did not respond to a request for comment.

The National Shooting Sports Foundation called the decision to create a new code for firearm and ammunition retailers “flawed on its premise.”

“This decision chills the free exercise of constitutionally protected rights and does nothing to assist law enforcement with crime prevention or holding criminals accountable,” spokesperson Mark Oliva said in a statement. “Attaching codes specific to firearm and ammunition purchases casts a dark pall by gun control advocates who are only interested in disarming lawful gun owners.”

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