Major credit card companies are in the process of creating a unique merchant code for firearm and ammunition retailers to comply with a new California law.
This law enables banks to potentially monitor suspicious gun purchases and report them to law enforcement. Currently, retailers, including gun shops, share merchant codes with other types of businesses, making it challenging to discern specific purchase patterns.
Initially, Mastercard, Visa, and American Express agreed to implement a separate code for firearm sellers. However, they paused their efforts after facing criticism from Second Amendment advocates who feared that tracking gun purchases could impinge on the rights of legal gun owners.
Credit Cards (Credits: New York Post)
Gun control activists see the new code, approved in 2022 by an international organization, as a tool to identify suspect purchases and prevent gun-related crimes, including mass shootings.
Supporters argue that a code for firearms merchants would enable banks and credit unions to alert law enforcement about potentially suspicious purchasing patterns, similar to how they flag other transactions related to identity theft or terrorist financing.
While a standalone merchant code for firearm and ammunition sellers would show that a transaction occurred at a gun store, credit card companies emphasize that the code would not disclose customer details or provide insight into individual items purchased.
Several Republican-controlled state legislatures have banned the code, and nine others are considering similar legislation. However, California, with its predominantly Democratic leadership, passed a law mandating retailers primarily selling firearms to adopt the code by May 2025.
Executives from Mastercard, Visa, and American Express have assured congressional Democrats that the code will be available to California retailers by the specified deadline.
However, they acknowledge the regulatory and legislative uncertainty surrounding the firearm merchant code, given conflicting state laws and potential future enactments.
Senator Elizabeth Warren expressed support for credit card companies complying with the California law, emphasizing the need for nationwide implementation to prevent gun violence.
Gun violence prevention advocates argue for federal legislation to resolve conflicts between states and highlight the code’s potential to prevent violence from straw purchases, gun trafficking, and mass casualty events.
A report from Guns Down America identifies eight mass shootings, including incidents in Aurora, Colorado, and Orlando, Florida, where perpetrators used credit cards to rapidly purchase large arsenals.
The report suggests that a system for flagging suspicious gun and ammunition sales could have given law enforcement opportunities to intervene and prevent multiple mass shootings over the past 15 years.
Hudson Munoz, the executive director of Guns Down America, warns that credit card companies staying neutral on this issue may risk uninhibited criminal abuse of the payment system. The organization urges credit card companies to make the gun store code available in every state where it has not been banned.
