No Special Code: New Act Stops Financial Companies From Tracking Gun Sales with Unique Merchant IDs

If you’re like most people, you probably don’t think much about the four-digit code assigned to the store where you buy your coffee or groceries. That’s the Merchant Category Code (MCC), a simple identifier used by credit card networks to classify businesses. But lately, there’s been a push to create a unique MCC specifically for firearms retailers, effectively singling them out from general sporting goods or department stores.

The Protecting Privacy in Purchases Act shuts that down. The bill makes it illegal for big payment card networks (think Visa or Mastercard) and the companies that process payments to force a licensed firearms retailer to use a specific MCC that flags them as a gun or ammo seller. The core idea here is straightforward: when you buy a firearm or ammunition legally, the transaction should be treated the same way as any other retail purchase.

The Financial Firewall: What This Means for Your Card

This legislation is essentially setting up a firewall between your legal purchases and attempts to monitor them using financial tools. For the average person buying a rifle for hunting or a handgun for self-defense, this means their transaction records won't be easily searchable or flagged by third parties simply because of the store's business type. The bill defines firearms retailer as anyone legally selling guns or ammunition (which is defined by existing federal law), ensuring the rule applies broadly to the industry.

From a practical standpoint, this prevents financial institutions—the covered entities and payment card networks—from creating a de facto registry or surveillance system for legal gun purchases. The bill ensures that a gun shop owner can process credit and debit card transactions using the same generic codes (like those used for general merchandise or sporting goods stores) that they might have used before.

Who’s Watching the Watchmen?

So who makes sure the big financial companies play by the rules? That job falls exclusively to the Attorney General. The AG is required to set up a system within 90 days of the law’s enactment for anyone—especially firearms retailers—to submit a complaint if they believe a payment network or processor is violating this rule. The AG must investigate every complaint filed.

If the investigation confirms a violation, the financial company gets a 30-day window to fix the issue. If they don’t, the Attorney General can take them to federal court to force compliance. This is a crucial detail: only the Attorney General can sue over violations; the bill explicitly states that private citizens cannot bring their own lawsuits. While this centralizes enforcement and keeps things focused, it also means that the law’s effectiveness relies entirely on the AG’s willingness and capacity to pursue cases.

Federal Rules Trump Local Codes

Another significant part of this Act is the immediate federal preemption. The law overrides any existing or future state or local regulation that tries to impose special MCCs on firearms retailers. If your state or city passed a law requiring this kind of unique tracking, that law is now void. This ensures a single, uniform rule across the country regarding how these financial transactions are categorized, which is a win for retailers who operate across state lines or deal with complex local regulations.

Finally, the Attorney General has to report to Congress annually, detailing the number of investigations conducted and summarizing the outcomes. This provides a necessary layer of transparency, allowing the public and lawmakers to see exactly how often these rules are being challenged and enforced, keeping the enforcement process accountable.