New York pushes JPMorgan, BofA, Visa to reconsider gun-sale risk
New York state's pension funds are urging credit card companies to consider following Citigroup's lead in cracking down on gun sellers.
Comptroller Thomas DiNapoli, the financial watchdog who also oversees the $209.1 billion retirement system for public employees, last week sent letters to nine companies. He asked them to explore whether gun transactions should be classified with restricted high-risk purchases like porn, drugs and cryptocurrencies, a spokesman said Wednesday.
The $209.1 billion pension, the third largest in the U.S., contacted the chief executives of nine financial institutions — Mastercard, Visa, American Express, Discover, JPMorgan Chase, Bank of America, Wells Fargo, First Data Corp. and Worldpay Inc. — asking them to assess risks and explore the cost of implementing systems that could reject purchases of firearms, ammunition or accessories.
"If gun violence continues unabated in society — public outcry and calls for action may grow and create significant financial risk for the company," DiNapoli said in the letter sent to MasterCard.
After the Parkland, Florida, high school shooting in February, financial institutions and businesses that have dealings with the gun industry have faced public pressure. Activists targeted Visa and Mastercard in particular, asking that the companies cease conducting business with retailers that sell assault rifles.
The New York system, which oversees retirement funds for more than a million people, owns millions of shares of the companies. DiNapoli said he worries that processing gun sales could be reputationally risky.
Citigroup Inc. last month said it plans to prohibit retailers that are customers from offering bump stocks or selling guns to people who haven't passed a background check or are younger than 21. DiNapoli cited policies of Apple Pay, PayPal, Square and Stripe, which have all prohibited firearms and ammunition purchases.
Credit card companies could make it tougher to buy guns, but critics have said the move could begin a slippery slope. The U.S. Department of Justice investigated banks that do business with firearm dealers amid concerns that such transactions could elevate risks for fraud and money laundering, but the program was ended in 2017 amid concerns it hurt legitimate business.