This bank wants to track suspicious sales of weapons and ammunition by credit card. Why can’t he?
The credit card industry has blocked a new effort to track suspicious gun and ammunition purchases, depriving law enforcement 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, have rebuffed a request to create a merchant category code for gun sellers and ammunition.
The application was first submitted in July 2021 by New York-based Amalgamated Bank and was twice denied by the International Organization for Standardization (ISO), which sets industry-wide standards financial services. The documents show that credit card industry employees were part of an internal committee within ISO that recommended the application be rejected. The ISO told CBS News that the credit card companies only advised the committee on a “personal” basis.
“Such 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 Chief Investigative Correspondent Jim Axelrod. , in an exclusive interview.
Amalgamated was founded by unionized workers nearly 100 years ago and bills itself as the nation’s oldest socially responsible bank.
“We believe you can do well and do good,” Sims Brown said.
The bank began considering requesting a unique gun dealer code after it said it noticed some of the deadliest mass shootings were funded by credit cards.
The shooter who terrorized ain 2012, he charged more than $9,000 worth of firearms, ammunition and tactical gear in the two months before his attack that left 12 dead and 70 injured.
The man who shot thekilling 49 people, put over $26,000 on credit cards.
And the shooter who killed 59 people in abilled nearly $95,000.
“We have an obligation to fight the crime that is facilitated by our system,” Sims Brown said.
What merchant codes for arms sales would give
Sims Brown said a merchant category code for gun and ammunition sellers would provide data to identify that a transaction was made at a gun store, without revealing which individual products were been purchased. Merchant codes are used in all sorts of industries.
“So you could be – a nail salon. You could be a sporting goods store. You’re assigned a merchant category code, so we can see that the purchase was made,” Sims said. Brown.
And while even shoe shine parlors have their own merchant codes, the approximately 9,000 standalone US arms dealers do not. With a unique code for gun 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 could identify and detect where there may be black market gun sales, where we see patterns of gun purchases being made at multiple gun stores,” Sims Brown said. “We were able to see the patterns of behavior that would tell us there is something wrong here.”
The bank said it could then file what is called a suspicious activity report with law enforcement if they suspect possible gun 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 routinely provide information to law enforcement,” former ATF Senior Special Agent Jim Yurgealitis told Axelrod. He has spent more than two decades investigating gun crimes for the federal law enforcement agency.
Yurgealitis said he thinks law enforcement would benefit from a one-size-fits-all code for gun dealers, especially in cases where someone buys a large amount of guns or in the case of a straw buy, when someone buys a gun for someone who is not legally allowed to have one.
“It could draw law enforcement’s attention to something they weren’t aware of before,” Yurgealitis said.
In July 2021, Amalgamated submitted its application to the International Organization for Standardization “for the creation of a new Merchant Category Code (MCC) for arms and ammunition stores”. The request was sent directly to two Visa and Mastercard employees who represent the industry on an ISO committee that reviews new merchant category codes.
“I can confirm that the MCC code request has been received and will be brought forward for discussion when the committee meets again,” the Mastercard employee wrote in an email to Amalgamated.
In October, the bank’s request was rejected. 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 a representation of all major cards [sic] global brands (MC, Visa, Amex, JCB, Discover, etc.).”
Amalgamated decided to appeal the decision after seeking feedback from card company employees.
“MCC specific [codes] in narrow shops [sic] are difficult,” wrote an American Express employee. “Managing long lists of tightly defined MCCs can become tedious if there is no compelling reason for the long list.
In February, the international organization rejected Amalgated’s appeal. In an email, the bank was told that a new code for gun and ammunition sellers would fail to capture “sales at sporting goods stores” and, at the same time, would impose a “burden” on small retailers.
Sims Brown said she was in disbelief that the organization rejected Amalgamated’s appeal.
“I mean, the shoe shine store has a merchant code,” she said. “Why not the armory? It’s so obvious. It’s hard to deny the logic.”
The International Organization for Standardization told CBS News that credit card companies were not responsible for the decision. Employees of these companies served in a personal capacity and “do not represent the views of their employer”. Those who pushed to reject Amalgamated’s application did so “based on their expertise”, the organization said.
In statements to CBS News, both American Express and Mastercard said they were working to ensure only legal purchases were allowed on their networks, but offered no details. Visa declined to comment.
Neither Visa, Mastercard nor American Express would say whether their companies supported the creation of a merchant code for gun sellers, as requested by CBS News. In a statement, Mastercard said “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 consumers are authorized to make legal purchases on our network”.
Sims Brown said she disagreed.
“It’s our responsibility,” she said. “What price do you put on a life? If it saves two people from dying, isn’t it worth it?”