Credit Card Companies Caught in Crossfire as Tennessee Shields Buyers’ Privacy and California Enforces Monitoring

New laws going into effect on Monday in California and Tennessee underscore the deep division in the country when it comes to guns. One party aims to assist banks in monitoring potentially concerning firearm purchases to prevent mass shootings and other gun-related homicides, while the other party wants to ban this practice.

Starting Monday, credit card companies are required to provide a merchant code for firearm and ammunition retailers in order to comply with California’s new law. This will help banks monitor gun sales and report any suspicious activity to the authorities. Retailers primarily selling firearms must adopt the code by May 2025, as mandated by the law.

This year, legislatures in Colorado and New York have passed measures that will require firearms codes to be implemented starting next year.

A gun merchant code is designed to identify potentially suspicious behavior, like an individual who has never purchased firearms before suddenly making significant purchases at multiple gun stores within a brief timeframe. Gun control advocates argue that if banks notify law enforcement authorities, they could potentially investigate and stop a mass shooting.

Gun-rights advocates have expressed concerns about the retail code potentially subjecting law-abiding gun purchasers to unfair scrutiny. Over the past 16 months, 17 states with Republican-controlled legislatures have implemented legislation that restricts or limits the use of firearms store codes.

California’s measure aligns with a separate state law in Tennessee that prohibits the use of firearm-specific merchant codes. The National Rifle Association has praised this law for safeguarding the financial privacy of gun owners.

Mastercard, Visa, and American Express made efforts to adhere to the new California measure, as previously reported by CBS News. The credit card networks had initially planned to introduce a separate code for firearm sellers, but they decided to pause that initiative due to objections from gun-rights advocates.

According to Guns Down America, credit cards are being used to facilitate gun crimes across America. They argue that implementing retail codes could help prevent violence associated with straw purchases, gun trafficking, and mass casualty events as per CBS News.

A nonprofit advocacy report highlighted eight mass shootings that could have been prevented, such as the Aurora, Colorado, movie theater shooting and the Pulse Nightclub shooting in Orlando, Florida. The report suggests that these tragedies could have been avoided if the perpetrators had not been able to quickly amass arsenals using credit cards.

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