Credit Card Companies Get Mixed Signals From States on MCC Issue – Bearing Arms

Credit Card Companies Get Mixed Signals From States on MCC Issue – Bearing Arms

When credit card companies first trotted out the idea of using a specific code for gun stores as part of their MCC listings, a lot of us got angry. We didn’t like the idea of credit card companies tracking our gun purchases, especially in light of the fact that we could well be buying anything at some of these stores that would get flagged as a gun purchase.

Following the outcry, the financial industry sort of backed down.

The idea was still there, but they weren’t going to implement it. Not yet, anyway.

Regardless, a number of states banned the practice. California, on the other hand, is now requiring it.

As a result, the whole mess has gotten more than a little confusing as the credit card companies are kind of getting mixed signals on the issue.

California this month became the first state to require credit card companies to create a unique four-digit code for stores selling firearms. And on the same day the law took effect in California, July 1, laws banning that code also went into effect in Tennessee, Georgia, Iowa and Wyoming.

The code, known as the merchant category code (MCC), tracks the type of business where a transaction was made to determine things like tax reporting or transaction fees. It can also be used to track purchasing behavior, but MCCs do not note the specific items purchased.

An international standards non-profit paved the way for credit cards to make a new code for gun retailers in 2022, and since then, state legislatures have moved in opposite directions to either encourage or prohibit credit card companies from using the codes.

Lawmakers backing gun reform supported the new code and called on the Department of the Treasury and the Department of Justice to issued guidance for financial institutions to implement the code in a 2023 letter signed by 14 U.S. Senators including Sen. Elizabeth Warren, D-Mass. and Sen. Kirsten Gillibrand, D-N.Y. They said the codes could help financial institutions spot illegal purchases and flag them to law enforcement before tragic mass shootings occur, like that at Robb Elementary School in Uvalde, Texas.

The problem is that those coming up with these plans are unaware that what the Robb Elementary killer did isn’t particularly unusual when it comes to gun purchases. People don’t necessarily limit their gun purchases to a single firearm.

Plus, the problem is that these codes deal with the stores themselves, not the individual items purchased. While proponents claim they can use the same methods developed to track financial crimes like money laundering to flag potential mass shooters, the reality is that money laundering behavior is primarily what you find when someone does something shady. Would-be mass shooters, however, buy guns in a manner not all that different from what other people do when buying firearms for lawful purchases.

So the code isn’t going to do what people say it will.

However, it could be quite handy in tracking down who purchased firearms in the last so many years by a government interested in civilian disarmament. There may not be gun registration, but this is the next best thing since even if they didn’t purchase a gun, the purchase at a gun store may well indicate gun ownership.

Luckily, the states that have banned the practice offer an option for those willing to travel to purchase a firearm. 

See, while one state must apply the gun control laws of the purchaser’s residence, I’m pretty sure there’s no way to make a law about MCC codes apply. As a result, this is ridiculously easy to skirt, and that’s the good news.

However, the fact that this is even a thing is incredibly problematic and, frankly, disgusting. 

It’s an idea based on the concept that there’s a correct number of guns one can buy during a certain period and anything over and above that is problematic. This “thinking” is something that would never be applied to any other constitutionally protected right. Anything beyond that certain number of guns during a given period should somehow trigger an investigation, and that means a lot of us might find ourselves targeted for scrutiny just because our financial situation changed and we can suddenly buy things we’d long wanted.

That’s not criminal behavior, but the people who cooked this nonsense up didn’t bother to talk to people familiar with firearm purchasing.

And as bad as all of that is, the fact that we’re getting both extremes in our laws just makes the MCC thing even more useless.

That is not a complaint.

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