Technical corrections only. The two versions of H.R. 1181 are substantively identical, with v4 reflecting the bill's procedural status as referred to the Senate after passing the House. No substantive policy changes were made between v3 and v4.
Protecting Privacy in Purchases Act
- Sponsor
- Rep. Moore, Riley [R-WV-2]
- Committees
- Financial Services Committee (primary)
- Last action
- Jul 15, 2026
Bottom line
This bill aims to prevent the tracking of firearm purchases via unique merchant category codes, asserting a privacy protection for consumers and preempting state efforts to implement such tracking.
What it actually does
This bill prohibits payment card networks and entities that process credit, debit, or prepaid transactions from requiring or assigning a specific merchant category code (MCC) that uniquely identifies firearms retailers. It mandates that firearms retailers be categorized similarly to general merchandise or sporting goods stores. The Attorney General is tasked with enforcing these prohibitions, and the Act preempts conflicting state or local laws, while explicitly allowing compliance with broader fraud prevention or illegal activity monitoring regulations.
Proponents argue
Proponents argue this bill protects the privacy of individuals exercising their Second Amendment rights by preventing financial institutions from creating a de facto registry of firearm purchases. They contend that singling out firearms retailers with unique MCCs could lead to discrimination, surveillance, or harassment of law-abiding citizens and businesses. Furthermore, they emphasize that existing laws and regulations are sufficient for tracking illegal activities without infringing on privacy.
Opponents contend
Opponents argue that unique MCCs for firearms retailers are a crucial tool for financial institutions to identify and report suspicious transaction patterns that could indicate illegal activities, such as straw purchases or financing of mass shootings. They contend that preventing such categorization hinders efforts to combat gun violence and that the privacy concerns are outweighed by the public safety benefits of allowing financial institutions to flag potentially illicit transactions.
The bill is concise and clearly written, making it accessible for a quick and informed review by any interested reader.
Section 2(a)
Prohibition on Unique Merchant Category Codes for Firearms Retailers
This section forbids payment card networks (like Visa, Mastercard) and "covered entities" (transaction processors) from requiring or assigning a merchant category code (MCC) that is used only or primarily for firearms retailers, or that specifically identifies a retailer as selling firearms, ammunition, accessories, or components. Essentially, it prevents financial systems from creating a distinct category for gun stores, ensuring these businesses are categorized similarly to general merchandise or sporting goods retailers.
Supporters argue
Supporters argue this provision is essential for protecting the privacy of law-abiding citizens who purchase firearms, preventing their transactions from being singled out for potential surveillance or discrimination. They assert that unique MCCs could be misused to create lists of gun owners or track legal purchases, infringing on Second Amendment rights.
Critics contend
Opponents contend that this prohibition removes a valuable tool for financial institutions to identify potentially suspicious or illegal firearm transactions, such as bulk purchases for trafficking or purchases by individuals planning violence. They argue that the ability to categorize these transactions is a reasonable measure for public safety.
Tradeoffs
The provision balances individual privacy rights and the right to bear arms against the desire for financial institutions and law enforcement to use transaction data to identify and prevent illegal activities or potential threats.
Section 2(b)
Attorney General Enforcement and Complaint Process
This section designates the Attorney General as the primary enforcer of the Act. It requires the Attorney General to establish a complaint process for individuals and firearms retailers to report violations. If a violation is found, the Attorney General must issue a 30-day notice to remedy the issue, and if not remedied, can seek an injunction in federal court. Importantly, it explicitly states that the Act does not create a private right of action, centralizing enforcement power within the federal government.
Section 2(c)
Preemption of State and Local MCC Regulations
This section explicitly preempts any state or local government laws that regulate the assignment, use, or disclosure of MCCs specifically for firearms retailers or that identify them as selling firearms or related items. However, it includes a crucial limitation: it does not prevent payment card networks or covered entities from complying with any federal, state, or local law or regulations related to dispute processing, fraud, compliance management, or protecting transaction integrity from concerns related to illegal or suspicious activities, data breaches, or cyber risks.
The definitions of "firearms retailer" and "firearm" are quite broad. "Firearms retailer" includes any person, entity, or retail location physically located in the United States that is engaged in the business of selling or trading firearms, ammunition, accessories, or components of firearms. "Firearm" itself incorporates multiple existing definitions from Title 18, United States Code, including shotguns, rifles, antique firearms, semiautomatic rifles, and handguns, ensuring a comprehensive scope.
Section 2(e)(3) and 2(e)(4)
Why it matters:This is standard legislative practice to ensure legal precision and avoid redundancy by referencing existing statutory definitions. It's not necessarily evasive, but it does require diligence to fully grasp the bill's reach.
Case for: Supporters would argue that these comprehensive definitions are crucial for ensuring the bill's protections apply broadly across the entire spectrum of firearm-related sales, preventing loopholes that could allow for the creation of new, specific MCCs for certain types of firearms or related items.
Case against: Critics might argue that the broadness of the definitions could inadvertently cover entities or transactions that are not the primary target of the legislation, potentially creating unintended consequences or overreach in its application.
Estimated impact: Ensures the prohibition on unique MCCs applies to virtually all commercial sales of firearms, ammunition, and related components across the United States.
While the bill preempts state and local laws regarding firearms MCCs, it explicitly states that nothing in the Act prevents payment card networks or covered entities from complying with any federal, state, or local law or regulations related to "dispute processing, fraud, compliance management, or protecting transaction integrity from concerns related to illegal or suspicious activities, data breaches, or cyber risks."
Section 2(c)(2)
Why it matters:This is a common legislative technique to mitigate potential negative consequences of a broad prohibition or preemption, ensuring that essential regulatory functions are not inadvertently undermined. It's a necessary nuance rather than an evasive tactic.
Case for: Proponents would highlight this carve-out as evidence that the bill is not intended to hinder legitimate law enforcement or fraud prevention efforts. They would argue it strikes a balance, protecting privacy while allowing financial institutions to continue monitoring for genuinely illegal or suspicious activities.
Case against: Opponents might argue that the language "illegal or suspicious activities" is vague and could be interpreted too narrowly, still preventing financial institutions from proactively identifying patterns of concern related to gun violence that might not immediately meet a strict definition of "illegal." They might contend that the very act of assigning a unique MCC *is* a tool for identifying suspicious activities.
Estimated impact: This clause attempts to preserve the ability of financial institutions to flag transactions for fraud or illegal activity, even if they cannot use a specific "firearms retailer" MCC. Its effectiveness depends on how "illegal or suspicious activities" is interpreted and what other tools remain available.