GOP AG warns credit card companies to comply with new state law banning tracking of gun purchases

A GOP attorney general is sending a warning to three of the nation’s leading credit card financial institutions concerning their plans to begin complying with a new state law that bans special tagging of firearm purchases.

The Tennessee Second Amendment Financial Privacy Act, which goes into effect on July 1, says "while federal law requires some financial institutions to report transactions that are highly indicative of money laundering or other unlawful activities, there is no federal or state law authorizing financial institutions to surveil and track lawful activities by customers in cooperation with law enforcement."

"The creation or maintenance of records of purchases of firearms or ammunition or the tracking of sales made by a retailer of firearms or ammunition by a nongovernmental entity, including a financial institution, without a substantial and historical business need or a requirement imposed by law, may frustrate the right to keep and bear arms and violate the reasonable privacy rights of lawful purchasers of firearms or ammunition," the law states.

But Tennessee Attorney General Jonathan Skrmetti says recent discussions with American Express Inc., Mastercard Inc. and Visa Inc. "have raised concerns that [those] institutions may not be taking appropriate measures to comply with the act."

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"The credit card companies have known this is coming and need to be prepared to comply with Tennessee’s new Second Amendment Financial Privacy Act the day it goes into effect," said Skrmetti. "If they are not able to do that, I will not hesitate to enforce the law duly enacted by the elected representatives of the people of Tennessee."

In September 2022, the International Organization for Standardization (ISO), a Europe-based organization, voted to create and adopt a merchant category code (MCC) specifically targeting firearm retailers. 

In a letter to the credit card companies on Wednesday, Skrmetti said the proposal "came from American activists and politicians attempting an international end-run around our legislative process after their initial efforts failed to pass." 

"As participants in the ISO policymaking process, your companies could have opposed this move, but you did not. The complications you now face flow directly from this cheerful acquiescence to the politicization of what should be a neutral financial infrastructure," he said. 

In March 2023, Visa and Mastercard said they had paused compliance with the ISO's code. At the time, Visa said that "significant confusion and legal uncertainty in the payments ecosystem" were reason for the pause. 

But Skrmetti says his "recent discussions" with the companies left him with concern that their level of compliance would not be "sufficient."

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In 2023, the Tennessee legislature passed legislation, with the governor’s signature, to block financial institutions from using an MCC code to target firearms dealers and institutions separate from regular sales. 

"The ISO’s controversial political decision resulted in many state laws with which you must comply," Skrmetti wrote. "As a participant in the ISO process, you had the opportunity to push back but declined to do so. Now, given the resources of your respective companies, I am confident that you can achieve timely compliance with your new legal obligations."

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The Republican AG warned the companies that beginning on July 1, 2024, a failure to prevent the use of the firearms MCC on their payment networks in Tennessee "risks violating state law."

"In such circumstances, I will not hesitate to exercise the full scope of my authority to enforce the law duly enacted by the elected representatives of the people of Tennessee," he said.

Fox News Digital reached out to Mastercard, Visa and American Express for comment.