Analysis: Nixing credit card codes are latest gun rights policy trend [Member Exclusive]


Financial privacy measures have quickly become one of the fastest-spreading policy successes in the gun rights movement.

In the last week alone, three more Republican-led states have enacted laws restricting the use of specialty merchant category codes (MCCs) by gun and ammunition stores.governors of states Iowa, Tennesseeand Georgia Signed into law with nearly identical language, the bill prohibits credit and debit card companies from using any MCC that “distinguishes firearms retailers from general merchandise retailers or sporting goods retailers.” The laws also include provisions prohibiting financial institutions from discriminating against legal firearms businesses and disclosing transaction information in most cases.

Currently, the total number of states with similar laws is 14 (Kentucky, Wyoming, Indiana, Utah, Florida, Idaho, Mississippi, Montana, North Dakota, Texas, and West Virginia has adopted similar laws). Just two years ago, that number was zero.

In such a short period of time, the policy was a huge success. The development is similar to other broad gun rights policy pushes, such as permit-less carry and Second Amendment sanctuary resolutions.

But while it took decades for these sports to catch on in red states, the MCC's ban was more of an overnight sensation. This is largely a reaction to the rapid increase in gun control activity on the same topic.

Until recently, the intersection of business class codes and gun policy was an alien concept to most political observers. MCC, which payment processing company Used for many years with relatively no controversy. They are often used to track general spending categories such as rewards programs.

However, financial writer Andrew Ross Sorkin first sowed the seeds of political discord over the guidelines in 2018.writing inside New York TimesSorkin documented many high-profile mass shootings in which credit or debit cards were used to purchase the guns and ammunition used in the attacks, often spending thousands of dollars in the process.He floated the idea of ​​banks and credit card companies attaching specific MCCs to gun stores that companies can use “Track” gun sales and help them report “suspicious” purchasing patterns to law enforcement.

While it didn't initially receive much mainstream attention, the article did inspire activist financial institutions such as Union Bank to begin lobbying the International Organization for Standardization (ISO) to create a firearms MCC. ISO finally agreed to do so in 2022.

More than 100 Republican members of Congress, at least a dozen senators and two dozen attorneys general sent separate letters to the companies condemn their decision Adopt the Code. However, it was not until states began passing laws banning the use of the new MCCs that the boycott began to have some success. Facing the prospect of inconsistent legal systems leads companies to 'pause' implementation of gun MCC last march.

“Several states across the U.S. are considering legislation to ban or restrict the use of new Merchant Category Codes (MCCs) by firearms and ammunition stores,” Visa spokesperson Julia Thompson said. reload then. “There is now significant confusion and legal uncertainty in the payments ecosystem, with state actions undermining the intent of global standards. As a result, Visa is suspending implementation of the MCC.

From an official perspective, this is the current situation, which is “on hold” and it has not yet been finalized whether the implementation of the MCC will move forward.

Democrats, led by figures such as Sen. Elizabeth Warren (D-Mass.), have Keep up the pressure The companies are pushing for legislation to implement firearms MCCs nationwide.In turn, Republicans introduce legislation their own MCC firearms are prohibited under federal law. Neither effort is likely to go anywhere in this Congress.

But there are plenty of signs that the national trend against MCC gun stores will continue. States such as New Hampshire, Ohio, Oklahoma and Alabama are considering similar bills this year and may not be the last. Meanwhile, as with so many other areas of gun policy in today’s polarized era, blue states are pursuing the exact opposite policy.

Last September, California lawmakers mandated the use of gun MCCs, and the bill was signed into law by Gov. Gavin Newsom. Colorado lawmakers recently passed a bill to do the same, but Gov. Jared Polis has yet to sign it into law.

The end result will be a patchwork approach to microfinance companies across the country, with an uncertain commitment from major credit card companies. have some signs These companies are taking steps to comply with California regulations Even though they announced the moratorium, it was still enforced. However, they declined to comment publicly on the matter.Currently, there are more states More countries have banned the code than enforced it.this may hinder The feasibility of global payments companies implementing codes that only apply to one or two countries.

The true test of the success of the policy movement against gun store MCCs will be whether big companies are forced to abandon these norms once and for all—either through a final bill in Congress, or simply as unworkable.



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