Credit card companies were preparing to track U.S. citizens’ purchases from firearm and ammunition retailers until a flurry of bills lobbed by state legislators caused all of them to reconsider those plans. However, it may be only a temporary victory.
Almost one year ago, an effort began to create a new Merchant Category Code (MCC) to track the purchases of firearms and ammunition. However, inspired by the uproar of Second Amendment constituents, Republicans in the U.S. Senate and lawmakers in several states have introduced legislative efforts that have successfully shut them down—for now.
On March 21, Sen. John Thune (R-S.D.) introduced SB 898. This bill prohibits the IRS from auditing a taxpayer based on the MCCs.
So far, seven states have joined the resistance.
On March 29, West Virginia Gov. Jim Justice approved House Bill 2004. In summary, the measure will “prevent the use of payment card processing systems for surveillance of Second Amendment activity and discriminatory conduct.” The bill would also preclude financial institutions that violate this law from qualification in bidding on state contracts.
On April 6, Idaho Gov. Brad Little signed House Bill 295 into law, also prohibiting financial institutions from using MCCs to identify or track firearms purchases.
‘They’re Not Finished’
West Virginia Del. Chris Phillips, a Republican, called the legislative effort in his state “a caucus priority.”“I think it’s vitally important that we protect citizen’s Constitutional rights from intrusion by government and big business,” Mr. Phillips explained.
He also believes that such an MCC “would have a chilling effect” on an individual’s willingness to risk purchasing a firearm and a retailer’s willingness to sell them.
“We’ve seen a lot of gun dealers being targeted by credit card companies that refuse to process transactions for them,” he said. “This opens that door far wider for that, I’m afraid.”
Mr. Phillips also suggested that the MCC effort has more to do with restricting gun rights than preventing any shootings.
“Unfortunately, I’m afraid the aim of gun control advocates isn’t stopping mass shootings; it’s gun control, and they will piecemeal it and take every inch they get until they take a mile,” he said.
Idaho Republican state Rep. Ted Hill said, “The whole idea was clearly a back-door surveillance mechanism for lawful gun owners.”
While the bill got “a lot of pushback from the banks,” Mr. Hill said it was “overwhelmingly passed,” with 62 of Idaho’s 70 delegates voting in support of the measure.
While those pushing the MCC appear to have backed down, Mr. Hill said he firmly believes “they’re not finished.”
The Background
On Sept. 9, the Switzerland-based International Organization for Standardization (ISO) announced that it would create a new MCC specific to merchants who sell firearms and ammunition.According to its website, the ISO is “an independent, non-governmental international organization” composed of 168 members. The ISO has a history of promoting guidance (pdf) for “social responsibility.”
Representing the United States in the ISO is the American National Standards Institute (ANSI). According to ANSI’s 2023 roster (pdf), Kristina Breen of Visa International Service Association is on the board of directors.‘Our Duty to Report Suspicious Activity’
The new code was in response to a petition by Amalgamated Bank, self-described as a conglomerate of “political animals” who support “hundreds of progressive political organizations, campaigns and candidates” such as “Biden/Harris,” “Warren Democrats,” and “Nancy Pelosi.”Announcing the ISO’s approval of the petition on Sept. 9, 2022, Priscilla Sims Brown, president and CEO of Amalgamated Bank, said, “We all have to do our part to stop gun violence, and it sometimes starts with illegal purchases of guns and ammunition.”
“The new code will allow us to fully comply with our duty to report suspicious activity and illegal gun sales to authorities without blocking or impeding legal gun sales.”
“This action answers the call of millions of Americans who want safety from gun violence, and we are proud to have led the broad coalition of advocates, shareholders, and elected officials that achieved this historic outcome,” she said.
Second Amendment advocates say these codes will be used to intimidate gun owners and that dealers will be used by banks to deny financial services to gun merchants.
Credit Card Companies
On Sept. 13, 2022, Visa shared its perspective on the proposed MCC.In response to the litany of bills drafted in opposition to the new MCC, Visa announced in a March 9 update: “These legislative actions disrupt the intent of global standards and create significant confusion and legal uncertainty in the payments ecosystem regarding this code and its use, including with acquirers, issuers, merchants and payment networks. We have therefore decided to pause implementation of the MCC at this time.”
‘This Is Getting Overblown’
Amy Swearer, a senior legal fellow at The Heritage Foundation, said she understands “the concerns.” But she said she believes “this is getting overblown on both sides both in terms of what gun control advocates claim the MCC is for and in terms of the actual threat that they pose.”“It won’t accomplish any of the gun violence prevention strategies that gun control advocates claim,” Ms. Swearer told The Epoch Times. “At the same time, it’s limited in what it enables the government to do in terms of more restrictive gun controls or tracking gun sales than it already has the capacity to do.”
She also noted the “variety of ways people can circumvent this.”
“They can use a debit card. They can use cash,” she said.
“Gun control advocates think that this would somehow allow credit card companies to flag what they call ’suspicious purchases,” Ms. Swearer said. “But they never define what that means, what the next steps would be, or how that would actually lead to gun violence prevention in a way that’s practical and effective without being completely insane and tyrannical and involve thousands of investigations into perfectly legitimate gun sales.”
“That’s part of the problem,” Ms. Swearer said, adding that an MCC “can’t tell you what was purchased.”
‘Veiled Gun Control’
In a statement issued to The Epoch Times, the National Rifle Association (NRA) condemned the MCC effort.“The NRA vehemently denounces the use of a firearm-specific Merchant Category Code (MCC), a clear infringement on the sacred Second Amendment rights of every American,” Billy McLaughlin, digital director and spokesman for the Office of Executive Vice President Wayne Robert LaPierre Jr., said. “Orchestrated by left-wing institutions and anti-gun lobbyists, this underhanded maneuver aims to bypass federal laws, effectively implementing a de facto national firearms registry and trampling the Constitution. Amid an environment where lawful gun sales already undergo rigorous scrutiny, this scheme represents an unprecedented assault on the privacy of law-abiding gun owners.”
The NRA also commended the states of West Virginia, Idaho, Mississippi, North Dakota, Florida, Montana, and Texas “for their proactive legislation against the MCC intrusion,” saying “their commitment to safeguarding liberties is inspiring and crucial in upholding our nation’s values.”
“The new coding approved by the non-governmental agency called the ISO effectively takes firearms and ammunition purchases and codes them into a specific MCC in order to track those sales and to flag so-called suspicious or potential criminal activity,” she said.
“What are the criteria for suspicious activity, and how will flagging this prevent gun violence?”
“The USCCA is staunchly opposed to this effort,” she said, adding that although the credit card companies have backed down, “the conversation doesn’t stop here.”
“It’s an important reminder to Americans why you need to continue to be involved in the legislative process and to ensure that your representatives are fighting to protect your Constitutional rights,” Ms. Pointer Baney said. “This pause came because Americans across the country stood up and complained to their representatives and their state AGs. There was outrage over this proposal, and it worked.”
Representatives of Mastercard, Discover, Visa, American Express, the ISO, and the ANSI didn’t respond by press time to a request by The Epoch Times for comment.