On September 1, 2022, Elizabeth Warren, and several other Democratic Senators and Representatives, sent a letter to the CEOs of Mastercard, American Express, and Visa requesting that the financial institutions adopt a “merchant category code” for firearm and ammunition retailers. On September 9, 2022, it was then announced that the International Organization for Standardization (“ISO”), a Geneva-based nonprofit organization that sets rules across the financial services industry, had approved a “merchant category code” for firearms and ammunition retailers. This paved the way for financial institutions to implement the codes for merchants and customers. Caving to the requests of Democratic senators, who work in conjunction with the anti-gun lobby, the world’s three largest financial institutions, Mastercard, American Express, and Visa, have now announced their plan to develop and implement merchant category codes for firearms and ammunition sales, under the false premise that such a practice may help prevent gun violence.
Merchant category codes are 4-digit numbers that are assigned by financial institutions to categorize purchases. These codes allow banks to track certain purchases such as those from grocery stores, hotels, and airlines. In some instances, these codes enable banks to track purchases that apply to rewards programs, and customers are issued points based on those purchases. Other codes are more generic. Currently, for example, merchant category codes used for firearms and ammunition retailers are the same as other retail stores, and have labels such as “miscellaneous retail store,” or “sporting goods store.” The addition of the new merchant category code for firearms or ammunition purchases would specifically indicate that the purchase was made at a firearm and ammunition retailer. The codes do not reveal which individual products were purchased, but indicate that a transaction was made at a certain type of business, and how much money was spent.
Previously, in 2021, the ISO had rejected a similar appeal from Democrats and the anti-gun lobby to create a new merchant category code for firearms retailers. The ISO had based its rejection on recommendations from Visa, Mastercard, and American Express. It appears, however, that these financial institutions and the ISO have now yielded under pressure from the anti-gun lobby and its Democratic partners. Anti-gun lobbyists and Democrats argue that these merchant category codes will enable financial institutions to monitor and report suspicious firearm sales to law enforcement. It is clear, however, that financial institutions are not qualified to determine when a purchase is purportedly suspicious, and improper allegations would directly infringe on the rights of law-abiding gun owners. Second Amendment activists have long argued that the creation of merchant category codes for firearm and ammunition retailers is a veiled attempt to create a national registry for gun owners. It is unclear how long it will take for financial institutions to develop and implement new merchant category codes for firearms/ammunition retailers, but law-abiding firearm owners should be aware that the change is likely coming.
Renzulli Law Firm, LLP will continue to monitor new and developing firearms legislation and regulation around the country, and fights every day to protect the rights afforded under the Second Amendment of the United States Constitution.  If you have any questions concerning firearms related legislation or regulation, please contact John F. Renzulli or Christopher Renzulli.