Tennessee Governor Enacts Law to Protect Privacy of Gun Buyers from Financial Institutions

Tennessee Republican Governor Bill Lee signed a bill into law earlier this week that prohibits financial institutions, such as banks and credit card companies, from specifically tracking gun and ammunition purchases.

House Bill 2762, also called the “Second Amendment Financial Privacy Act,” prohibits financial institutions from requiring gun retailers to use a specific merchant code “that distinguishes a firearms retailer from a general merchandise retailer or a sporting goods retailer.” All retailers are assigned merchant codes based on what they sell, allowing banks and credit card companies to track purchasing patterns and protect against fraud. Gun retailers’ merchant codes are usually included with those of other shops, like sporting goods stores.

State Rep. Rusty Grills, a Republican, introduced the legislation earlier this year after credit card companies Visa and Mastercard announced plans to separately categorize firearm and ammunition purchases in 2022.

The “Second Amendment Financial Privacy Act” also prohibits financial institutions from declining credit card transactions “based solely on the assignment or non-assignment of a firearms merchant category code” and outlaws government entities from keeping a registry of privately owned firearms or gun owners in the state.

Rep. Grills told The Daily Wire in a phone conversation on Thursday that he introduced the legislation to “protect the Second Amendment rights of all those in Tennessee” by preventing financial institutions from creating “a database” of gun buyers, a possibility Grills said is troubling because many corporations are being led by “capitalist woke folks.” Grills added that this new law will preempt any potential future efforts by institutions to interfere with Tenesseeans’ Second Amendment rights.

“We would rather be able to protect our rights from the beginning rather than have to fight for our rights back at the end,” Grills said.

The bill passed the state House and Senate earlier this month before it was signed into law by Gov. Lee on Tuesday.

In 2022, the International Organization for Standardization (IOS) — which develops proprietary, industrial, and commercial standards — approved a new merchant code specifically for gun retailers.

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Shortly after the IOS approved the change, credit card companies took the step of categorizing gun purchases separately from all other purchases. At the time, congressional Democrats were also urging Visa, Mastercard, and American Express to “do more to help stop mass shootings.”

Those three credit card companies, however, paused plans to track gun purchases a few months later after Republican lawmakers and attorneys general warned the payment processors of the constitutional ramifications of their proposal. But in February of this year, Visa, Mastercard, and American Express moved forward with a plan to potentially track gun purchases in California, CBS News reported.

While multiple Republican-led state legislatures have passed bans on the specific merchant code for gun retailers, California passed a law requiring gun retailers to adopt the merchant code by May 2025.