Credit Cards ‘Pause’ Efforts To Track Gun Purchases After Pushback
Just weeks ago, gun control advocates were doing happy dances as credit card companies prepared to implement a new merchant category code (MCC) that would ease the way, sort of, for tracking gun purchases. Now, under public pressure, financial institutions are backing away from those codes and supporters of self-defense rights are celebrating. It’s an illustration of how quickly the high ground can change hands on America’s political battlefields. But it also shows how politicized business has become, and how difficult it is for private companies to navigate between the country’s political tribes.
In February, Discover announced it would implement a new merchant category code to be used to identify transactions with firearms dealers, and implied that its competitors in the credit card business were doing the same. The code was rolled out last year by the International Standards Organization after intense lobbying by anti-gun American politicians and Amalgamated Bank, an institution that uses financial leverage to promote “sustainable organizations, progressive causes, and social justice.”
Premature Victory Lap
Gun-control advocates celebrated a win for efforts to monitor and, potentially, judge purchases.
“Banks are developing technology to identify potential mass shooters, according to a CEO backing the push to get credit-card companies to more closely track gun purchases,” Bloomberg reported in November. “‘Detection scenarios’ are in the works that, if triggered, would prompt banks to file a Suspicious Activity Report to the Treasury Department’s Financial Crimes Enforcement Network, Amalgamated Bank Chief Executive Officer Priscilla Sims Brown said at the New York Times DealBook conference Wednesday.”
Self-defense advocates understandably took that to mean the new merchant codes would be used to harass gun owners, stigmatize dealers, and maybe isolate both from financial services. They started pushing back—effectively, it seems.
“To continue alignment and interoperability with the industry, Discover is removing the new merchant category code identified as MCC 5723 from our April 23.1 Network Release,” a Discover representative told me by email (MCC 5723 is the gun-specific merchant category code).
“Our rules require our customers to conduct lawful activity where they are licensed to use our brands. ISO’s decision to create a firearms-related merchant category code (MCC) does not change that,” added a MasterCard representative. “Today, there are bills advancing in several states related to the use of this new code. If passed, the result will be an inconsistency in how this ISO standard could be applied by merchants, issuers, acquirers and networks. It’s for that reason that we have decided to pause work on the implementation of the firearms-specific MCC.”
Visa is taking similar action. American Express didn’t reply to r
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