NY State Senate Bill 2023-S8479

Senate Bill S8479

2023-2024 Legislative Session

Requires issuers of credit and debit cards to use certain merchant category codes for firearm dealers

download bill text pdf

Current Bill Status - In Senate Committee Consumer Protection Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Feb 05, 2024	referred to consumer protection

2023-S8479 (ACTIVE) - Details

See Assembly Version of this Bill:: A9862
Current Committee:: Senate Consumer Protection
Law Section:: General Business Law
Laws Affected:: Add Art 29-BBB §§529 & 529-a, Gen Bus L

2023-S8479 (ACTIVE) - Summary

Requires issuers of credit and debit cards to use certain merchant category codes for firearm and ammunition dealers.

2023-S8479 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S8479

SPONSOR: MYRIE
 
TITLE OF BILL:

An act to amend the general business law, in relation to requiring
issuers of credit and debit cards to use certain merchant category codes
for firearm merchants

 
PURPOSE 0R 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 "CREDIT CARD", "DEBIT CARD", "PERSON", "ISSUER",
"HOLDER", "PROCESSOR", "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 JULY 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 PRECAU-
TIONARY 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.

2023-S8479 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8479
 
                             I N  S E N A T E
 
                             February 5, 2024
                                ___________
 
 Introduced  by  Sen.  MYRIE  -- read twice and ordered printed, and when
   printed to be committed to the Committee on Consumer Protection
 
 AN ACT to amend the general  business  law,  in  relation  to  requiring
   issuers  of  credit  and  debit cards to use certain merchant category
   codes for firearm merchants
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. The general business law is amended by adding a new article
 29-BBB to read as follows:
 
                              ARTICLE 29-BBB
                          CREDIT AND DEBIT CARDS
 
 SECTION 529.   DEFINITIONS.
         529-A. MERCHANT CATEGORY CODES.
   §  529. DEFINITIONS.  FOR  THE PURPOSES OF THIS ARTICLE, THE FOLLOWING
 TERMS SHALL HAVE THE FOLLOWING MEANINGS:
   1. "CREDIT CARD" MEANS AND INCLUDES ANY  CREDIT  CARD,  CREDIT  PLATE,
 CHARGE  PLATE,  COURTESY  CARD,  OR  OTHER IDENTIFICATION CARD OR DEVICE
 ISSUED BY A PERSON TO ANOTHER PERSON WHICH MAY BE USED TO OBTAIN A  CASH
 ADVANCE OR A LOAN OR CREDIT OR TO PURCHASE OR LEASE PROPERTY OR SERVICES
 ON THE CREDIT OF THE ISSUER OR OF THE HOLDER.
   2.  "DEBIT CARD" MEANS A CARD, PLATE OR OTHER SIMILAR DEVICE ISSUED BY
 A PERSON TO ANOTHER PERSON WHICH MAY BE USED, WITHOUT A  PERSONAL  IDEN-
 TIFICATION NUMBER, CODE OR SIMILAR IDENTIFICATION NUMBER, TO PURCHASE OR
 LEASE PROPERTY OR SERVICES. THE TERM DOES NOT INCLUDE A CREDIT CARD OR A
 CHECK, DRAFT OR SIMILAR INSTRUMENT.
   3.  "PERSON" INCLUDES AN INDIVIDUAL, CORPORATION, PARTNERSHIP OR ASSO-
 CIATION, TWO OR MORE PERSONS HAVING A JOINT OR COMMON  INTEREST  OR  ANY
 OTHER LEGAL OR COMMERCIAL ENTITY.
   4. "ISSUER" MEANS A PERSON WHO ISSUES A CREDIT CARD OR A DEBIT CARD.
   5. "HOLDER" MEANS A PERSON TO WHOM SUCH A CREDIT CARD OR DEBIT CARD IS
 ISSUED OR WHO HAS AGREED WITH THE ISSUER TO PAY OBLIGATIONS ARISING FROM
 THE USE OF A CREDIT CARD OR DEBIT CARD ISSUED TO ANOTHER PERSON.
   6.  "PROCESSOR" MEANS A PERSON WHO FACILITATES THE USE OF CREDIT CARDS
 OR DEBIT CARDS BETWEEN A HOLDER AND A SELLER.

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD13704-01-3
 S. 8479                             2
 
   7. "PROCESSOR SERVICE" MEANS THE CREDIT CARD  OR  DEBIT  CARD  FACILI-
 TATION SERVICE PROVIDED BY THE PROCESSOR.
   8.  "SELLER"  MEANS  ANY PERSON WHO HONORS CREDIT CARDS OR DEBIT CARDS
 WHICH MAY BE USED TO PURCHASE PROPERTY.
   § 529-A. MERCHANT CATEGORY CODES. 1. FOR THE PURPOSES OF THIS SECTION,
 THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:
   (A) "DEALER OF AMMUNITION" MEANS ANY PERSON WHO ENGAGES IN  THE  BUSI-
 NESS OF PURCHASING, SELLING OR KEEPING AMMUNITION.
   (B)  "DEALER  OF  FIREARMS"  MEANS  A  GUNSMITH OR DEALERS IN FIREARMS
 LICENSED PURSUANT TO SECTION 400.00 OF THE PENAL LAW.
   (C) "FIREARM" HAS THE SAME MEANING AS THAT TERM IS DEFINED IN SUBDIVI-
 SION THREE OF SECTION 265.00 OF THE PENAL LAW.
   2. (A) ON OR BEFORE JULY FIRST, TWO THOUSAND TWENTY-FOUR, EACH  ISSUER
 SHALL  MAKE THE MERCHANT CATEGORY CODE FOR FIREARMS AND AMMUNITION BUSI-
 NESSES ESTABLISHED BY THE INTERNATIONAL ORGANIZATION FOR STANDARDIZATION
 ON SEPTEMBER NINTH, TWO THOUSAND TWENTY-TWO,  AVAILABLE  FOR  PROCESSORS
 WHICH  PROVIDE PROCESSOR SERVICES FOR SELLERS WHO ARE DEALERS OF AMMUNI-
 TION OR DEALERS OF FIREARMS.
   (B) ON AND AFTER MAY FIRST, TWO THOUSAND TWENTY-FIVE,  EACH  PROCESSOR
 SHALL  ASSIGN  TO  EACH  DEALER OF AMMUNITION AND DEALER OF FIREARMS THE
 MERCHANT CATEGORY CODE FOR FIREARMS  AND  AMMUNITION  BUSINESSES  ESTAB-
 LISHED  BY THE INTERNATIONAL ORGANIZATION FOR STANDARDIZATION ON SEPTEM-
 BER NINTH, TWO THOUSAND TWENTY-TWO.
   3. WHENEVER THERE SHALL BE A VIOLATION OF THIS SECTION,  THE  ATTORNEY
 GENERAL  SHALL  GIVE WRITTEN NOTICE TO THE PERSON VIOLATING THIS SECTION
 IDENTIFYING THE SPECIFIC PROVISIONS OF THIS SECTION  THAT  ARE  OR  WERE
 BEING  VIOLATED.  THE  ATTORNEY  GENERAL SHALL NOT BRING AN ACTION UNDER
 THIS SECTION WHERE, WITHIN THIRTY DAYS OF RECEIVING SUCH WRITTEN NOTICE,
 THE PERSON CURES THE VIOLATION AND PROVIDES THE ATTORNEY GENERAL WITH  A
 WRITTEN STATEMENT CONFIRMING THE VIOLATION WAS CURED, INCLUDING SUPPORT-
 ING DOCUMENTATION ON HOW THE VIOLATION WAS CURED, AND STATING HOW INTER-
 NAL  POLICIES WERE CHANGED TO PREVENT SUCH VIOLATIONS IN THE FUTURE.  IF
 THE VIOLATIONS WERE NOT CURED OR PROPER WRITTEN NOTICE NOT  RECEIVED  BY
 THE ATTORNEY GENERAL WITHIN THIRTY DAYS OF WRITTEN NOTICE BEING RECEIVED
 BY SUCH PERSON VIOLATING THIS SECTION, AN APPLICATION MAY BE MADE BY THE
 ATTORNEY GENERAL IN THE NAME OF THE PEOPLE OF THE STATE OF NEW YORK TO A
 COURT OR JUSTICE HAVING JURISDICTION BY A SPECIAL PROCEEDING TO ISSUE AN
 INJUNCTION, AND UPON NOTICE TO THE DEFENDANT OF NOT LESS THAN FIVE DAYS,
 TO  ENJOIN  AND  RESTRAIN  THE CONTINUANCE OF SUCH VIOLATIONS; AND IF IT
 SHALL APPEAR TO THE SATISFACTION  OF  THE  COURT  OR  JUSTICE  THAT  THE
 DEFENDANT  HAS,  IN  FACT,  VIOLATED  THIS SECTION, AN INJUNCTION MAY BE
 ISSUED BY SUCH COURT OR JUSTICE, ENJOINING AND RESTRAINING  ANY  FURTHER
 VIOLATION,  WITHOUT  REQUIRING  PROOF THAT ANY PERSON HAS, IN FACT, BEEN
 INJURED OR DAMAGED THEREBY. IN ANY SUCH PROCEEDING, THE COURT  MAY  MAKE
 ALLOWANCES  TO  THE  ATTORNEY  GENERAL  AS  PROVIDED IN PARAGRAPH SIX OF
 SUBDIVISION (A) OF SECTION EIGHTY-THREE HUNDRED THREE OF THE CIVIL PRAC-
 TICE LAW AND RULES, AND DIRECT RESTITUTION.  WHENEVER  THE  COURT  SHALL
 DETERMINE  THAT  A VIOLATION OF THIS SECTION HAS OCCURRED, THE COURT MAY
 IMPOSE A CIVIL PENALTY OF NOT MORE THAN TEN THOUSAND  DOLLARS  FOR  EACH
 VIOLATION  AND REASONABLE ATTORNEY'S FEES AND COSTS INCURRED IN INVESTI-
 GATING AND BRINGING AN ACTION UNDER THIS SECTION. IN CONNECTION WITH ANY
 SUCH PROPOSED APPLICATION, THE ATTORNEY GENERAL IS  AUTHORIZED  TO  TAKE
 PROOF  AND  MAKE  A  DETERMINATION  OF  THE  RELEVANT FACTS AND TO ISSUE
 SUBPOENAS IN ACCORDANCE WITH THE CIVIL PRACTICE LAW AND RULES.
   § 2. This act shall take effect immediately.

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