The credit card industry has blocked a new effort to track suspicious purchases of firearms and ammunition, depriving police of a potential tool to identify and stop gun crime.
Documents obtained by CBS News show that employees of domestic and international credit card companies, including Visa, Mastercard and American Express, pulled back on an application to create a merchant category code for sellers of firearms and ammunition.
The request was first filed in July 2021 by the New York-based Amalgamated Bank, and was twice denied by the International Standards Organization (ISO), which sets standards across the financial services industry. The documents show that credit card industry officials were part of an internal ISO committee that recommended rejecting the application. The ISO told CBS News that the credit card companies only advised the committee and did so in “personal capacity.”
“So much illegal gun activity depends on your ability to use the financial system to buy guns,” Priscilla Sims Brown, CEO of Amalgamated Bank, told CBS News correspondent Jim Axelrod in an exclusive interview.
Amalgamated was founded by union workers nearly 100 years ago and calls itself the oldest socially responsible bank in the country.
“We believe you can do good and do good,” said Sims Brown.
The bank began considering applying for a unique firearms dealer code after it noticed that some of the deadliest mass shootings were being financed with credit cards.
The sniper who terrorized ain 2012 it charged more than $9,000 for weapons, ammunition and tactical equipment in the two months leading up to its attack that killed 12 and wounded 70.
The man who shot thekilling 49 people, put more than $26,000 on credit cards.
And the sniper who killed 59 in onecharged nearly $95,000.
“We have an obligation to address the crime that is being facilitated through our system,” said Sims Brown.
What trade codes for gun sales would yield
Sims Brown said a business category code for firearms and ammunition sellers would provide data that could identify a transaction made at a gun store, without revealing which individual products were purchased. Merchant codes are used in all types of industries.
“So you could be – a salon. You could be a sporting goods store. There’s a merchant category code assigned to you so we can see that the purchase was made,” said Sims Brown.
And while even shoeshiners have their own merchant code, the nearly 9,000 self-employed arms dealers in the US do not. With a code unique to firearms and ammunition sellers, the bank said it could run software to detect purchases in the same way it detects evidence of other suspicious activity, such as fraud and human trafficking.
“We can identify and detect where there might be black market gun sales, where we see patterns of gun purchases being made at various gun stores,” said Sims Brown. “We can see patterns of behavior that tell us something is wrong here.”
The bank said it could then file what’s called a suspicious activity report with authorities if it suspects possible firearm crimes. Banks and credit unions made more than 1.4 million reports in 2021, flagging transactions that could suggest anything from identity theft to terrorist financing.
“Financial institutions provide information to law enforcement on a regular basis,” former ATF Senior Special Agent Jim Yurgealitis told Axelrod. He spent more than two decades investigating gun crimes for the federal law enforcement agency.
Yurgealitis said he believes law enforcement would benefit from a unique code for firearms sellers, especially in cases where someone is buying a large quantity of guns or in the case of a straw purchase, when someone is buying a gun for someone who is not legally allowed to have one.
“This might draw the police’s attention to something they were previously unaware of,” said Yurgealitis.
In July 2021, Amalgamated submitted its application to the International Standards Organization “for the creation of a new commercial category code (MCC) for gun and ammunition stores”. The request was sent directly to two Visa and Mastercard employees who serve as industry representatives on an ISO committee considering new merchant category codes.
“I can confirm that the MCC code request has been received and will be presented for discussion when the committee reconvenes,” the Mastercard employee wrote in an email to Amalgamated.
In October, the bank’s request was denied. Prior to applying, the bank was told by the Visa employee in an email: “While I cannot specify actual voters or individual names, there is representation from all major cards [sic] brands globally (MC, Visa, Amex, JCB, Discover, etc.).”
Amalgamated decided to appeal the decision after seeking more information from the card company’s employees.
“specific CCM [codes] in narrow retails [sic] areas are challenging,” wrote an American Express employee.
In February, the international organization denied Amalgated’s appeal. In an email, the bank was told that a new code for arms and ammunition sellers would not capture “sales at sporting goods stores” and at the same time place a “burden” on small retailers.
Sims Brown said she was in disbelief that the organization had denied Amalgamated’s appeal.
“I mean, the shoeshine store has a merchant code,” she said. “Why not the gun shop? It’s so obvious. It’s hard to deny the logic.”
The International Standards Organization told CBS News that the credit card companies were not responsible for the decision. Employees of these companies were serving in a personal capacity and “do not represent the views of their employer”. Those who lobbied to reject Amalgamated’s application did so “on the basis of their experience,” the organization said.
In statements to CBS News, American Express and Mastercard said they were working to ensure that only legal purchases were allowed on their networks, but did not offer details. Visa declined to comment.
Neither Visa, Mastercard or American Express would say whether their companies supported creating a merchant code for firearms sellers when asked by CBS News. In a statement, Mastercard said that “we believe it is the responsibility of elected officials to enact meaningful policies to address the issue of gun violence, while it remains Mastercard’s role to ensure that consumers are allowed to make legal purchases on our network.”
Sims Brown said he disagreed.
“It’s our responsibility,” she said. “What price do you put on a life? If it keeps two people from dying, isn’t it worth it?”