Democratic Senators Want Treasury, DOJ to Push for Gun Store Credit Card Code

Democratic boosters of the effort to attach a unique credit card code to gun stores are seeking new help from the federal government.

On Wednesday, a coalition of fourteen U.S. Senators sent a letter to federal regulators urging them to issue guidance for credit card companies to implement a new merchant category code (MCC) for gun stores. The letter, spearheaded by Senators Bob Menendez (D-N.J.) and Elizabeth Warren (D-Mass.), specifically asked the Department of the Treasury and the Department of Justice (DOJ) to establish procedures for using the MCC to “identify and report potentially illegal gun sales to law enforcement.”

“Financial firms are already obligated to report suspicious transactions connected with a range of illegal activities,” the letter reads. “Implementation of the new MCC code could provide banks with key insight to identify suspicious patterns of firearm and ammunition purchases, which could potentially help law enforcement preempt mass shootings.”

The letter signals that the political fight over gun store MCC codes is far from over. It arrives on the heels of the decision last week by several of the country’s largest credit card processors to “pause” plans to implement a new MCC for gun and ammunition stores. The companies said they were concerned over backlash to the plan, including pending legislation in various states that would discourage or outright ban the use of MCC codes for gun stores.

In a press release unveiling the letter, the senators acknowledged the course reversal of the major credit card companies. They blamed “Republican-led states” for the shift. They said, “credit card companies have a responsibility to push forward, and Treasury and DOJ should provide them, and other financial institutions, with the proper tools for implementation in a timely manner.”

In support of their ongoing efforts, the Senators cited a 2018 New York Times article that found the majority of mass shooters between 2007 and 2018 used credit or debit cards to purchase the guns and ammunition used in their attacks. That article is widely credited with popularizing the theory behind using MCC codes to flag “suspicious” gun purchases for law enforcement.

Critics of the code, including gun-rights advocates and many top Republican lawmakers, have charged that a special gun store MCC would unfairly target gun owners and could raise consumer privacy risks.

Meanwhile, the major credit card companies have poured cold water on the idea of gleaning data from MCC codes that could be used to flag “suspicious” gun purchases. Despite initially agreeing to implement the gun store MCC code, Visa noted that it could not be used to identify the types of products actually purchased in a particular store.

“MCCs do not give Visa or any other payment network visibility into product-level data, also known as ‘SKU-level’ data,” the company said. “When we process a transaction, we have no visibility into what items a consumer is purchasing — this is true irrespective of which MCC applies to a merchant.”

Visa also attempted to distance itself from the idea of keeping tabs on its customers’ shopping habits.

“We do not believe private companies should serve as moral arbiters,” the company added. “Asking private companies to decide what legal products or services can or cannot be bought and from what store sets a dangerous precedent. Further, it would be an invasion of consumers’ privacy for banks and payment networks to know each of our most personal purchasing habits.”

Other senators who signed the letter include Kirsten Gillibrand (D-N.Y.), Ed Markey (D-Mass.), Dianne Feinstein (D-Calif.), Chris Murphy (D-Conn.), Mazie Hirono (D-Hawaii), Cory Booker (D-N.J.), Bob Casey (D-Pa.), Brian Schatz (D-Hawaii), Richard Blumenthal (D-Conn.), Tammy Baldwin (D-Wis.), Chris Van Hollen (D-Md.), and Ben Ray Luján (D-N.M.).