Utah Law Says “No” to Tracking Firearms/Ammo Purchases Through Credit Card Transactions

by Tommy Grant

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Utah Governor Spencer Cox has signed a bill into law, spearheaded by Rep. Cory Maloy and sponsored in the Senate by Sen. Chris Wilson, that aims to protect the privacy of gun owners by prohibiting financial institutions in the state from using a specific credit card merchant code for tracking these purchases. This legislation, House Bill 406 (HB406), directly responds to concerns over privacy and the potential for unwarranted surveillance of gun owners in the state.

The legislation defines a “firearms code” as merchant category code 5723, a designation approved in September 2022 by the International Organization for Standardization (ISO), specifically for firearms retailers. HB406’s provisions prevent financial entities, including credit card networks, from assigning or requiring the use of this code for transactions involving firearms, accessories, ammunition, or reloading supplies. Furthermore, Utah firearms retailers are barred from providing such a code to financial entities for the purpose of selling firearms-related items.

The state attorney general is empowered under the new law to enforce these provisions and impose civil penalties for violations. This move by Utah, which will become effective May 1, aligns with similar laws passed in Mississippi, Idaho, North Dakota, Montana, Texas, and Florida during the 2023 legislative session. Indiana signed a similar bill into law this month as well.

These legislative efforts have led major credit card payment networks to “pause” the implementation of the firearms merchant code, citing “inconsistency” in how the code could be applied across various jurisdictions.

Critics of the merchant category code argue that its use could enable the federal government to circumvent existing laws and build databases on gun owners, potentially infringing on individuals’ rights and privacy. The Tenth Amendment Center highlights the risks associated with the creation of such databases, including the potential for misuse by unauthorized entities, as evidenced by the Taliban’s reported use of a U.S. government-created firearm ownership database in Afghanistan.

Deseret News further elaborated on the Utah legislation’s implications, noting the voluntary nature of the ISO’s code 5723 and the existing legal framework that prevents the federal government from tracking firearms purchases beyond initial background checks. The new law, according to proponents, is designed to prevent the federal government from exploiting the merchant code to conduct unwarranted surveillance on lawful gun owners.

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