MONTGOMERY — The Alabama House of Representatives passed legislation prohibiting financial institutions from collecting transaction data specific to firearms and ammunition sales, sending it to Gov. Kay Ivey's desk for a signature.

Senate Bill 281 (SB281) follows the pattern of several states that have passed similar legislation to address the recent implementation of Merchant Category Codes (MCCs) for gun and ammunition purchases.

Gun rights advocates have opposed the use of firearm-specific MCCs since the stated purpose is to collect and report suspicious gun activity and develop algorithms to report it to law enforcement. Data collection on gun owners and their purchases has led many to fear potential discrimination or reprisal by the government for purchasing firearms. Additional concerns exist for the collection of a compulsory de facto gun database that could be used to track or persecute gun owners.

State Rep. Shane Stringer (R-Citronelle), who filed an identical bill in the House, presented it before the body and drove it to the final passage. Stringer said the bill was amended in the Senate to prevent local banks from facing penalties if a payment processor violates the bill's provisions.

"This is going to prevent credit companies from tracking or identifying ammunition or gun sales through the MCC codes," Stringer said. "We've done a lot of work on it to make it better."

State Reps. Laura Hall (D-Huntsville) and Mary Moore (D-Birmingham) expressed some general concerns about the bill but nothing overly specific or strident. 

The legislation ultimately passed the House with a vote of 86-3 with nine abstentions. Assuming Ivey signs the bill, it would go into effect on October 1.

The bill would prohibit financial institutions or payment processors from assigning or requiring a merchant to use a firearms code in a way that distinguishes a firearms retailer physically located in Alabama from general merchandise retailers or sporting goods retailers. It would also prohibit financial institutions from declining to process lawful payments based on the assignment of gun-specific MCCs.

The bill would also prevent any state agency from keeping a record or registry of privately owned firearms their owners, except in the regular course of a criminal investigation and prosecution or as required by state law.

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