Attorney general warns credit card companies of shaky compliance with gun purchase surveillance law

Tennessee Attorney General Jonathan Skrmetti warned three major credit card companies to comply with a state law prohibiting the companies from flagging gun purchases.

In a letter to American Express, Mastercard, and Visa on Thursday, the Republican lawmaker wrote he is worried the companies “may not be taking appropriate measures” to comply with a new Tennessee law set to go into effect July 1.

The Tennessee Second Amendment Financial Privacy Act warns financial institutions against collecting data on lawful firearm purchases. The law was passed after a leading European organization created a pathway for credit card companies to flag firearm purchases using a special code.

In 2022, the International Organization for Standardization voted to pass a Merchant Category Code for firearm retailers to use when processing credit and debit card transactions through payment networks used by major financial institutions. Top credit card companies in the United States, including American Express, Mastercard, and Visa, were affected by the decision.

Concerned that the controversial technology violated Second Amendment freedoms, Tennessee became one of eleven states to pass legislation blocking the ISO’s MCC code in 2023.

“There is no federal or state law authorizing financial institutions to surveil and track lawful activities by customers in cooperation with law enforcement,” the Tenneesse law reads.

"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.

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While Visa and Mastercard said they paused compliance with the ISO's code in 2023, Skrmetti says his "recent discussions" with the companies give him reason to believe otherwise.

Skrmetti says the credit card companies will face repercussions if they fail to follow the law. Should American Express, Mastercard, and Visa flag firearm purchases, the GOP attorney general warns he "will not hesitate to exercise the full scope of my authority to enforce the law."