The merchant category codes demanded by gun control groups that were announced to great fanfare last fall are now in limbo after major credit card companies, including Visa and Mastercard, announced on Wednesday that they’re halting their rollout of the codes in response to a number of bills filed in red states that bar the use of the codes and promise fines for those credit card companies that use them.
The companies have never really been on board with the category code since the far-left Amalgamated Bank and gun control activists began lobbying for the International Standardization Organization to create one several years ago. The anti-gunners claim the code will help prevent mass shootings by requiring the companies to flag “suspicious transactions” at firearms retailers, but both Visa and Mastercard executives have said the codes don’t identify specific purchases, and the responsibility to flag any transactions deemed suspicious is more about reducing banking fraud and other financial crimes. At the very least, the legislation both companies referenced in today’s decision may have given the companies an easy out for a scheme they were never really on board with in the first place.
“There are bills advancing in several states related to the use of this new code,” a spokesman for Mastercard said in a statement Thursday. If passed, the proposals would create an “inconsistency” in how the code is applied by merchants and others, he said. “It’s for that reason that we have decided to pause work on the implementation of the firearms-specific MCC.”
Visa also took a pause because of the “significant confusion and legal uncertainty” the legislative proposals have created, according to a spokesperson.
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“MCCs are one data point that would not provide any insight on specific purchases or resolve larger issues,” the Mastercard spokesman said. “We are committed to working with policymakers and elected officials to contribute to constructive solutions that address the gun violence issue, while respecting important constitutional rights and protections for lawful activities.”
In addition to the announcement by Visa and Mastercard, Discover now says it will not be rolling out the use of the MCCs as it had previously announced just a few weeks ago. American Express is also “pausing” its implementation of the MCCs for the time being, so it does look like most major companies are in agreement.
As you can imagine, gun control groups are losing their minds over the decision. Here’s a taste of Brady’s press release on the announcement:
“It is shameful to hear that credit card companies Visa and Mastercard have caved to the gun lobby’s transparent political ploys.
“If true, Visa and Mastercard are choosing political expediency over American lives. Make no mistake, Americans will continue to suffer and die as a result of this deadly decision. Having a dedicated process to flag troubling and suspicious firearms purchases, like they already do to detect other fraudulent purchases, is a common-sense strategy for companies to save lives and prevent the next mass shooting.
“We urge Visa and Mastercard to correct their course immediately. The choice they have now is clear: adopt this new tool at their disposal to prevent gun violence, or drag their feet while gun violence devastates our communities across the country. Every delay of action results in more lives needlessly taken.”
Remember, the codes don’t identify specific purchases. Companies like Visa and Mastercard are supposed to determine if a purchase is suspicious based on the dollar amount and the frequency of any purchases at gun shops; an utterly impossible task, at least without generating an untold number of false flags.
However, it won’t just be gun control activists huffing and puffing. Look for California Gov. Gavin Newsom to respond in some form or fashion, and we’ll probably see other blue states introduce counter-legislation (at least where the legislative calendar permits it) that would penalize credit card companies that don’t implement the MCC’s for firearm retailers. Today’s news is a very welcome development for Second Amendment advocates, but I doubt it’s the end of the story.