Credit Card Issuers Join the Fight to Limit Mass Shootings

A new code for guns.Credit…Brennan Linsley/Associated Press

What next to crack the code on gun violence

A new way of using the financial industry to try to limit mass shootings is finally here. But it’s only the beginning.

On Friday, the International Organization for Standardization, or ISO, which sets standards for payment transactions, approved the creation of a special code for gun stores to use when processing credit or debit card transactions. Shortly after, American Express, Mastercard and Visa said they would adopt the new code, which gun-control advocates say would help flag suspicious activity.

It was an idea that I developed and introduced in a series of DealBook columns in 2018 following the Parkland shooting, after investigating the critical role that credit card companies and banks play in financing mass shootings. It would essentially add a new four-digit number to specifically identify gun stores, much as ISO categorizes movie theaters and hair salons as separate businesses.

Lawmakers like Senator Elizabeth Warren, Democrat of Massachusetts, publicly supported the plan, as did pension funds; Amalgamated Bank had twice asked ISO to create the code, before succeeding on Friday with its third attempt. “This approval is an important step towards improving coordination with law enforcement and preventing gun violence,” Senator Warren said on Friday of ISO’s decision.

Visa and Mastercard had resisted the creation of the code — even though some of their own executives favored it — for fear of offending politicians who support gun rights or having to be, in a Visa executive’s words, “a moral authority” on consumer purchases. Gun-rights supporters have argued the code could lead to the unfair blocking of lawful purchases or tracking of gun owners.

In a statement after the approval on Friday, ISO said it had acted because credit-card companies “were unable to reach a decision” about creating a new code. But even as they said they would adopt the new merchant code, Mastercard and Visa said they would work to protect “all legal commerce” and “the privacy and decisions of individual cardholders” on their networks.

Creating the merchant code is only the beginning. Here’s what will need to happen next for it to help identify suspicious purchases:

  • Card networks like Mastercard and Visa need to not only adopt the code, but also enforce its use by merchants and payment processors.

  • Merchants must start using the code, and not obfuscate transactions by using other classifications.

  • Big retailers like Walmart and sporting goods stores — which themselves use different merchant codes — need to use the code at registers they use to ring up firearms.

  • Most crucially, the payments industry needs to develop and refine software algorithms for identifying suspicious activity based on the merchant codes. (Amalgamated has begun work on this.) Banks could then either allow those transactions, or block them and file suspicious activity reports with the Treasury Department’s Financial Crimes Enforcement Network, which would ideally also create a system to quickly forward that information to local law enforcement and the F.B.I.


The markets rise amid Ukraine’s gains in its war with Russia. U.S. futures, Asian and European stocks and the euro are all up after the Ukrainian military secured over 1,000 square miles of territory in the country’s northeast. For some investors, Ukraine’s gains may be easing fears of a Russia-driven global energy crunch and climbing inflation.

The White House reportedly weighs new limits on U.S. chipmaking exports to China. The restrictions could forbid American companies from shipping chip manufacturing equipment to Chinese factories focused on advanced semiconductors without U.S. approval, according to Reuters. The regulations may also include other actions against China.

The fraud trial of Nikola’s founder begins today. Prosecutors have accused Trevor Milton of lying to investors about the electric truck maker’s technology, in one of the highest-profile fraud cases to arise from the electric-vehicle boom. Shares in Nikola are down nearly 92 percent from their peak in 2020.

Major League Baseball will recognize a minor league players’ union. The move by the league followed years of resistance, with M.L.B. arguing that minor leaguers were similar to apprentices in other fields. Some argue the move suggests M.L.B. sees a coming end to its antitrust exemption.

Bob Chapek fends off activist threat over ESPN

The activist investor Dan Loeb appears to be retreating from one of his primary demands of Disney: spin off ESPN.

Yesterday morning, Loeb, whose firm Third Point last month disclosed it had bought a significant stake in Disney, tweeted that he had a better understanding of ESPN’s innovation and synergy plans. As a result, he thought the brand, a leader in sports programming, was better off staying inside Disney.

His tweet followed an interview Disney C.E.O. Bob Chapek gave to The Financial Times, on the sidelines of Disney’s annual superfan expo D23, in which Chapek said he remained convinced that ESPN’s “potential is within Disney.”

Chapek and Loeb now seem to be on the same page. Chapek said Disney had been “deluged” with offers for ESPN, after rumors began circulating earlier this year that his company was looking to sell it. Chapek said those offers demonstrated ESPN’s value. He said Disney had a plan to “restore ESPN to its growth trajectory” and that “when the rest of the world knows what our plans are, they will be as confident about that proposition as we are.” (Chapek told Bloomberg the company was “working very hard” on a sports betting app.)

But Chapek said one of Loeb’s other demands — that Disney buy Comcast out of the two companies’ partnership in Hulu — was not likely to happen. Chapek said Comcast appeared uninterested in selling its stake anytime before 2024, when it is contractually required to do so. “We have talked to them numerous times over the past year-plus,” he told The F.T. “If that were in the cards we would love to do that, but it takes two to tango.”

Chapek is working on putting forward a softer side. After a rocky year, he showed up at the D23 expo having grown a beard and shed his frumpy suits. The charm offensive appeared to be part of his efforts to rebrand himself to Disney’s faithful, reports The Times’s Brooks Barnes. “I’m trying to show a little more of who I am,” Chapek said. “I haven’t had a lot of chances.”

The latest fashion in antitrust

It’s New York Fashion Week, a biannual celebration of luxury and consumption when designers show their collections and set the trends for the season ahead. Also in the spotlight will be questions about the industry’s environmental destructiveness. Sustainability is a theme for many designers in the shows and for the event’s organizer, the Council of Fashion Designers of America, which has pledged to achieve a net zero goal by 2050.

But “sustainable fashion” is a contradiction. Being “green” in fashion would mean designers and retailers would produce less — and yet companies that band together to advance such goals may run into trouble with antitrust regulators. In June, Reuters reported that a series of raids by E.U. antitrust authorities on fashion houses was connected to companies’ discussions of limiting sales for sustainability. The European Commission hasn’t named the companies involved or commented further on the purpose of the raids.

“There are emerging tensions between E.S.G. and antitrust,” William Kovacic, a former F.T.C. chairman, told DealBook, referring to environmental, social and governance goals. “A vocal group of commentators say antitrust enforcement treats cartels very harshly and that unduly inhibits firms from pursuing environmental and social goals.”

Now, some environmental activists and industry advocates are pushing for a reassessment of competition policy, said Kovacic, a professor at the George Washington University Law School. Some designers and retailers have proposed overhauling the fashion calendar to reduce waste, limiting sale periods and changing the length of seasons. But those types of agreements risk violating antitrust rules that ban competitors from collaborating to fix prices and reduce production.

Regulators in the Netherlands are updating antitrust rules for the net-zero age. For example,last week, authorities endorsed rules to encourage sustainable agriculture, which would involve greater collaboration among farmers, wholesalers and supermarkets. “Sometimes I see a certain degree of restraint” by companies that fear breaking the law, Martijn Snoep, chairman of the Dutch competition regulator, said, adding that cooperation within an industry or along the supply chain is often “not at odds with the competition rules.” Last year, he proposed an approach that is broader than that of the E.U., writing, “We see opportunities for competitors to work together, especially when combating the climate crisis.”

But there is a potential hitch in rewriting the rules.

“The more ambiguous the standard, the more likely businesses will take liberties,” Kovacic said. Some antitrust authorities say competition policy should consider more varied corporate objectives. Still, it’s not clear that enforcers are contemplating loosening cartel rules for the good of the planet. (The F.T.C. declined to comment; the Justice Department did not respond.)

“While this sounds like a bad science-fiction movie, it is unfortunately a real threat.”

— Ralph Axel, an interest-rate strategist at Bank of America, on new wobbles in the market for U.S. Treasury bonds as the Fed removes support for government debt.

Apollo’s former heir apparent announces next move

Josh Harris, who co-founded the private equity giant Apollo, formally unveiled his own investment firm, 26North, on Friday. It has raised $5 billion so far and hired 40 employees. Harris initially looks to be building a mini-Apollo, focusing on private equity investments, direct lending and insurance.

Harris left Apollo after losing a power struggle. Last year, Harris tried to force out his fellow co-founder Leon Black, after reports emerged that Black had a longer and deeper relationship with the sex offender Jeffrey Epstein than earlier known. Black left, but not before naming Marc Rowan, Apollo’s third co-founder, as the head of the firm. Harris left Apollo earlier this year.

Harris has recruited executives from a number of Wall Street firms, as well as Apollo. Mark Weinberg, who ran U.S. private equity at Brookfield Asset Management, will be the head of P.E. at 26North. The former Goldman execs Brendan McGovern and Lance West are also joining the firm, as is Evan Zemsky from Apollo.



  • Credit Suisse board members have reportedly floated the idea of giving top deal-makers equity in the bank’s advisory business. (Bloomberg)

  • Elon Musk said Twitter’s $7 million payout to a whistle-blower was another justification for ending his $44 billion takeover bid of the company. (Reuters)

  • The home-fitness company Tonal is said to be raising money at a $1.9 billion valuation. (Bloomberg)


  • China has issued tens of billions in “emergency loans” to debt-ridden nations, becoming a rival to the I.M.F. (FT)

  • The E.U.’s top Brexit official offered to reduce customs checks at the Northern Irish border to defuse trade tensions with Britain. (FT)

  • Activists are pushing states to raise alcohol taxes to combat a rise in drinking-related deaths. (NYT)

Best of the rest

  • Wall Street firms say they’re recruiting employees from struggling tech and crypto companies. (FT)

  • Billy McFarland, the founder of the Fyre Festival, is out of prison — and hunting for his next big idea. (NYT)

  • The world’s biggest hub for olive oil production is struggling with a crippling drought. (NYT)

  • But wine producers in Bordeaux say drought and forest fires haven’t prevented the 2022 harvest from being “very promising.” (Decanter)

Thanks for reading! We’ll see you tomorrow.

We’d like your feedback. Please email thoughts and suggestions to [email protected].

We’d like your feedback! Please email thoughts and suggestions to [email protected].

Related Articles

Back to top button