JEFFERSON CITY, Mo. (Mar. 1, 2024) – A bill filed in the Missouri House would prohibit financial institutions operating in the state from using a credit card merchant code that would enable the tracking of firearm and ammunition purchases.
Rep. Willard Haley introduced House Bill 2778 (HB2778) on Feb. 21. The legislation would prohibit a financial institution or credit card processor operating in Missouri from requiring a firearms code in a way that distinguishes a firearms retailer physically located in the state of Missouri from Missouri general merchandise retailers or sporting goods retailers.
The bill would also prohibit a financial institution in the state from “discriminating against a firearms retailer” by declining a lawful payment or charging a higher fee based solely on the assignment or nonassignment of a firearms code, or from taking any action against a customer or merchant that is intended to suppress lawful commerce involving firearms, firearm accessories or components, or ammunition, which action is based solely or in part on the customer’s or merchant’s business involving the same.
Additionally, HB2778 would bar any government or private entity from maintaining a list, record, or registry of privately owned firearms or their owners.
An individual or retailer located in the state of Missouri would be allowed to file a complaint with the State Attorney General in response to an alleged violation, which would then investigate the complaint. If the AG does not take action after 90 days, the individual or retailer may be able to file their complaint in court.
Businesses found in violation would have 30 days to cease the use of a firearms code. Those who still do not comply would be subject to a penalty in which “the court shall consider factors including the financial resources of the violator and the harm or risk of harm to Second Amendment rights resulting from the violation.”
IN EFFECT
In response to legislation like this, major credit card payment networks “paused” implementation of the firearms merchant code. In an email to Reuters, a Mastercard representative said such bills would cause “inconsistency” in how the code could be applied by merchants, banks and payment networks.
In September 2022, the International Standards Organization, based in Switzerland, approved a new merchant category code for firearm and ammunition merchants. In the letter to payment card networks, federal lawmakers stated that the new Merchant Category Code for firearms retailers would be “. . .the first step towards facilitating the collection of valuable financial data that could help law enforcement in countering the financing of terrorism efforts,” expressing a clear government expectation that networks will utilize the new Merchant Category Code to conduct mass surveillance of constitutionally protected firearms and ammunition purchases in cooperation with law enforcement.
The more states that ban such codes, the more likely this program gets scrapped permanently.
IMPACT ON FEDERAL PROGRAMS
Data collected from this merchant code would almost certainly end up in federal government databases.
Concern about the misuse of federal firearms databases isn’t just paranoia. The Taliban has reportedly used a firearm ownership database created by the U.S. government to track down gun owners and confiscate firearms in Afghanistan. This goes to show that even if you trust the people creating the database, it can fall into the wrong hands. In other words, the very existence of a database is a danger.
The feds can share and tap into vast amounts of information gathered at the state and local level through fusion centers and a system known as the “information sharing environment” or ISE.
Fusion centers were sold as a tool to combat terrorism, but that is not how they are being used. The ACLU pointed to a bipartisan congressional report to demonstrate the true nature of government fusion centers: “They haven’t contributed anything meaningful to counterterrorism efforts. Instead, they have largely served as police surveillance and information sharing nodes for law enforcement efforts targeting the frequent subjects of police attention: Black and brown people, immigrants, dissidents, and the poor.”
Fusion centers operate within the broader ISE. According to its website, the ISE “provides analysts, operators, and investigators with information needed to enhance national security. These analysts, operators, and investigators…have mission needs to collaborate and share information with each other and with private sector partners and our foreign allies.” In other words, ISE serves as a conduit for the sharing of information gathered without a warrant. Known ISE partners include the Office of Director of National Intelligence which oversees 17 federal agencies and organizations, including the NSA. ISE utilizes these partnerships to collect and share data on the millions of unwitting people they track.
In practice, local data collection using ALPRs, stingrays, drones and other spy technologies creates the potential for the federal government to obtain and store information on millions of Americans including phone calls, emails, web browsing history, location history, and text messages, all with no warrant, no probable cause, and without the people even knowing it.
In a nutshell, without state and local assistance, the feds have a much more difficult time gathering information. When the state limits surveillance and data collection, it means less information the feds can tap into. This represents a major blow to the surveillance state and a win for privacy.
WHAT’S NEXT
HB2778 has not yet been referred to a committee. When it does, it will need a public hearing and a majority vote before it can advance in the legislative process.
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