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Citi-Cards and First Data update

Via commenter Largenfirm here, Citi responds:

Thank you for your message. The posting at www.nssf.org regarding Citi Merchant Services and First Data Corp. is inaccurate. Further, while we generally do not comment on individual merchant customers, we would like to briefly address the 12/26 letter posted on the web site. Regretfully, that letter did a less than satisfactory job of expressing applicable policies. Those policies are more properly detailed below.

Citi Merchant Services and First Data do process firearms transactions. Our policy restrictions address only the sale of firearms in a non face-to-face environment. Non face-to-face transactions occur when a cardholder is not present in front of a merchant and includes mail order and online purchases. It is our policy not to service merchants that make non face-to-face sales in a number of industries, including firearms.

It is not the policy of Citi Merchant Services or First Data to refuse to process transactions from duly licensed merchants that sell firearms in face-to-face transactions at the point of sale.

Please direct any questions to Questions@firstdata.com.

The posting also incorrectly states that Robert Tenenbaum is the supervisor when, in fact, he is not.

I’m still not particularly satisfied with that.

17 Responses to “Citi-Cards and First Data update”

  1. Magus Says:

    It is our policy not to service merchants that make non face-to-face sales in a number of industries, including firearms.

    Until I see a listing of the “number of industries” I’ll assume they’re lying.

  2. Jim W Says:

    It sounds like they confirmed that they are doing it but tried to phrase it like a denial.

  3. ben Says:

    Me neither. I’ve bought every firearm save one that I currently own via the internet. They always have to go though an FFL (except for in state rifle and shotgun purchases from non-dealers).

    I usually pay with an MO, since there’s no 3% fee.

  4. nk Says:

    Makes some sense. Could they possibly think that they need the FFLs of both the seller and buyer on file so as not to be accessories in the event of an illegal transfer? What’s the BATF’s position on this?

  5. AlanDP Says:

    So according to this, they still won’t allow transactions involving the mail order of black powder arms, even if you live in a state where it’s legal to mail order such arms.

    What about non-face to face transactions for ammunition?

  6. Kristopher Says:

    They are just lying.

    They handle adult porn orders over the internet all the time.

  7. Joe Huffman Says:

    No new information here. They still have a policy of denying the use of their services for the purposes of legal firearm transactions.

  8. Rustmeister Says:

    I’m with Jim W. The original article stated that they were claiming the “face to face” thing up front.

    There was no real misrepresentation on the part of the NSSF, Citi just sucks.

  9. Standard Mischief Says:

    Shi… err I mean Citi can go to hell.

  10. Ted Novin Says:

    Here is the NSSF response to the Citi Merchant Services and First Data claim that our posting about their anti-gun policy was inaccurate:

    January 10, 2008

    Dear XXXXX

    This is to confirm the National Shooting Sports Foundation’s receipt of your e-mail response on behalf of First Data Corporation and Citi Merchant Services on Wednesday, January 9, 2008, concerning First Data and Citi Merchant’s unilateral decision to stop processing credit card transactions involving the lawful sale of firearms by law-abiding, federally-licensed, firearms distributors/retailers. Regrettably, your e-mail serves to confirm the anti-gun corporate policy of First Data and Citi Merchant Services and that the article in our publication “Bullet Points,” and subsequent posting to our Website, was based on a correct and accurate understanding of that policy as articulated in the December 26, 2007, letter to Mr. Charlie Crawford at CDNN Sports Inc.

    We had hoped to hear from First Data Corporation and Citi Merchant Services that this was not your corporate policy and that the letter was merely the ill-considered actions of a single employee.

    Your anti-gun corporate policy is based on ignorance of the law applicable to the sale of firearms. It is perfectly legal, in fact commonplace, for a federal firearms licensee in one state to sell a firearm to a non-licensee (consumer) from another state. What you fail to appreciate is that the firearm is not shipped in interstate commerce directly to the consumer. Rather, as required by federal law, the firearm is shipped by the selling licensee to another federal firearms licensee in the state of residence of the consumer who is purchasing the firearm. The consumer acquires the firearm from that licensed dealer in a face-to-face transaction after completion of a Firearms Transaction Record, commonly referred to as an ATF Form 4473, and a federally-mandated background check to ensure that the purchaser is legally permitted to buy the firearm.

    Furthermore, the policy of First Data and Citi Merchant Services interferes with the receiving and shipping of inventory from and to federally licensed firearms retailers, distributors and manufacturers. This inventory supplies not only law-abiding Americans, but military and law enforcement agencies as well.

    June Rivera-Mantilla’s original correspondence contained so many errors that one could only deduce that it was an uniformed mistake that would consequently be corrected. Instead, we learned yesterday that First Data Corporation and Citi Merchant Services stands behind the policy, which affects not only firearms retailers, manufacturers and distributors, but also law enforcement agencies at the federal, state and local levels of government and law-abiding citizens.

    NSSF will not remove its Web posting nor will we rescind or alter our story. However, if we receive written confirmation from you that, after having researched the law, First Data and Citi Merchant Services have changed their corporate policy, we will consider publishing that fact in a follow-up story.

    Sincerely,

    Jake McGuigan
    Director of Government Relations

    Ted Novin
    Director of Public Affairs

  11. Barry Says:

    Gun control is better than it was 10 or 15 years ago, but that’s mainly due to a required background check which are never 100%. More effective yet non-intrusive things need to be done.

  12. templeton Says:

    There’s usually more to the story that cannot be told, and unfortunately a troubled merchant has the advantage of telling an impartial story while the processor or merchant bank is at legal jeopardy in exposing the actual reason for account cancellation and suspension of funds.

    As someone who actually works for a card processor (who also has a sizable handgun and rifle collection and belongs to the NRA), I can point those here to several clues to help assist in identifying the real issue. A card processor is not interested in the politics, gun ownership, etc. of a client. If you understood how many locations and diverse businesses we process cards in, you’re realize we have neither the time nor the interest.

    What processors are interested in, however, is fraud. Due to mandates of Visa (which we must represent in our contract as specified by Visa), for instance, there are various fraudulent activities that result in the suspension of an account and/or the maintenance of a reserve. Our systems monitor for fraud, not for gun transfers, casino visits, adult emporium purchases, etc, and we are required by Visa to carry out suspensions, etc.

    Unfortunately, it isn’t uncommon that when a merchant has a fraud problem, they blame the processor. I’ve seen allegations from intentional interference with a retail business because we do business with a competitor (can you imagine blaming UPS or the power company for this?), accusations of refusing to help address crime problems because we sell products to help with that and expect to be paid for the assistance we provide (which isn’t mandatory and merchants have signed an agreement indicating they have th capacity to protect cardholder data with or without the services we offer as an option), etc.

    Those who want to understand this situation really should look at what triggers the issues this merchant has experienced to have an objective outlook. The bank doesn’t repossess a car because you put an NRA sticker on the back and the bank “hates gun owners”, yet I’m sure there’s no shortage of those stories out there too.

  13. SayUncle Says:

    Those who want to understand this situation really should look at what triggers the issues this merchant has experienced to have an objective outlook.

    We’ve seen what NSSF said. And what citi said. Seems that nothing that citi said in its rebuttal really refutes the NSSF’s original claim.

  14. straightarrow Says:

    there actions affect an industry. not problem accounts. there is no way this isn’t political.

  15. AK Says:

    You all just don’t understand. The elitists have hit on the perfect plan….strangle the firearms trade (and the gun culture with it) through peripheral means like this….lawsuits…administrative regulations limiting the number of FFLs and how the few remaining do or don’t do business ….refusals to process transactions…urban and suburban dwellers having no place to shoot and little interest…and poof..the availability of firearms dries up….one of the NWOs main goals, civilian disarmament and emascualtion achieved and without a single Congresscritter having to risk his or her political life proposing controversial legislation…..

    Like the father in the movie “Red Dawn”..said to his sons from behind Communist reeducation camp barbed wire..”one way or the other…one reason or the other..it’s gone…it’s all gone….”

  16. Diane Says:

    The problem is that FDC processes 60% or better of the credit card transactions across the country. They also ‘own’ most of the data lines that ATM information is transmitted across (they own the STAR system). I thought that I was safe with my USAA credit card, but USAA has confirmed that FDC processes the transactions for all of their credit cards. FDC and American Express also have an agreement — see it here:(http://home3.americanexpress.com/corp/pc/2007/fdc.asp)
    First Data is everywhere and is not soley affliated with Citi. Hard to escape FDC…
    I hope that they feel major backlash as a result of their decision but I am afraid that this just might be the start of something bigger. I will not give up my right to purchase and own firearms and will not have FDC or Citi telling me what to do or how to do it!!

  17. Robohobo Says:

    This kind of thing just makes me spend more money on the tools in the gun safe. More weapons. More ammo. I do not doubt that the grabbers are coming for our guns and soon.