BILL NUMBER: S8479A
SPONSOR: MYRIE
 
TITLE OF BILL:
An act to amend the general business law, in relation to requiring
payment card networks to use certain merchant category-codes for firearm
merchants
 
PURPOSE OR GENERAL IDEA OF BILL:
The creation of a new merchant category code for gun and ammunition
retail businesses and dealers to enable financial institutions to moni-
tor suspicious purchasing patterns.
 
SUMMARY OF PROVISIONS:
Section 1 amends the general business law, adding new article 29-BBB
which defines the terms "merchant acquirer", "payment card network",
"person", "issuer", "processor service", "seller", "dealer of ammuni-
tion", "dealer of firearms", and "firearm".
This section requires credit or debit card issuers to make the merchant
category code for firearms and ammunition businesses established by the
International Organization for Standardization on or before November 1,
2024; requires credit or debit card processors to assign a merchant
category for dealers of firearms and ammunition established by the
International Organization for Standardization on or by May 1, 2025.
This section empowers the Attorney General to bring action on behalf of
the people of the state of New York if violations of this act have not
been cured 30 days after a written notice.
Section 2 provides the effective date.
 
JUSTIFICATION:
Nearly 45,000 Americans were killed with guns in 2021, and the country
experiences gun violence at rates exceptionally higher than our peer
nations. Since 2009, there have been 279 mass shootings resulting in
more than 1,500 gun deaths; meanwhile, the shooters in some of the worst
mass shootings in recent memory used credit cards to make their arsenal
purchases.. For example, in a matter of six weeks, the shooter who
killed 12 people at an Aurora movie theater charged $11,000 worth of
guns, ammunition, and body armor-to a Mastercard. Similarly, the killer
who massacred 60 people on the Las Vegas strip used credit cards to
purchase guns and ammunition totaling nearly $100,000 in the 12 months
before the attack. The Pulse nightclub shooter racked up $26,000 in
credit card charges on guns and ammunition in less than two weeks
preceding the carnage that killed 49 people and wounded 53. As a
precautionary measure, the shooter searched online to learn whether his
"unusual spending" pattern could be detected by the credit card compa-
nies and flagged for law enforcement. After being reassured that he need
not worry about detection, he completed his purchases and irrevocably
damaged countless families and the Orlando community as a whole.
Reporting from the Wall Street Journal in April 2018 explained how banks
and credit card companies could help law enforcement preempt some mass
shootings by identifying suspicious gun purchases through the implemen-
tation of a new MCC. Later that year, a Dealbook investigation into the
financing of mass shootings continued and accelerated.
MCCs are four-digit codes maintained by the International Organization
for Standardization (ISO), which classify merchants by the nature of
their businesses. Financial institutions and payment networks, including
MasterCard and American Express, use the ISO standard to assign MCCs to
merchants in order to determine interchange rates, assess transaction
risks, and generally categorize payments. Currently, unique MCCs exist
for "wig and toupee shops" and "electric razor shops," but none exist
for firearms dealers.
The creation of a new MCC for gun and ammunition retail stores 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. A new MCC code could make it easier for financial
institutions to monitor certain types of suspicious activities including
straw purchases and unlawful bulk purchases that could be used in the
commission of domestic terrorist acts or gun trafficking schemes. Such
coordination between financial institutions and law enforcement has been
instrumental in efforts across the Federal government to identify and
prevent illicit activity.
 
PRIOR LEGISLATIVE HISTORY:
New bill.
 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
None.
 
EFFECTIVE DATE:
This act shall take effect immediately.