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How Banks Unwittingly Finance Mass Shootings
The New York Times reviewed hundreds of documents including police reports, bank records and investigator notes from a decade of mass shootings. Many of the killers built their stockpiles of high-powered weapons with the convenience of credit. No one was watching.
Two days before Omar Mateen killed 49 people and wounded 53 more at the Pulse nightclub in Orlando, he went on Google and typed “Credit card unusual spending.”
Mr. Mateen had opened six new credit card accounts — including a Mastercard, an American Express card and three Visa cards — over the previous eight months. Twelve days before the shooting, he began a $26,532 buying spree: a Sig Sauer MCX .223-caliber rifle, a Glock 17 9-millimeter semiautomatic pistol, several large magazines, thousands of rounds of ammunition and a $7,500 ring for his wife that he bought on a jewelry store card. His average spending before that, on his only card, was $1,500 a month.
His web browsing history chronicled his anxiety: “Credit card reports all three bureaus,” “FBI,” and “Why banks stop your purchases.”
He needn’t have worried. None of the banks, credit-card network operators or payment processors alerted law enforcement officials about the purchases he thought were so suspicious.
Mass shootings routinely set off a national debate on guns, usually focused on regulating firearms and on troubled youths. Little attention is paid to the financial industry that has become an instrumental, if unwitting, enabler of carnage.
A New York Times examination of mass shootings since the Virginia Tech attack in 2007 reveals how credit cards have become a crucial part of the planning of these massacres. There have been 13 shootings that killed 10 or more people in the last decade, and in at least eight of them, the killers financed their attacks using credit cards. Some used credit to acquire firearms they could not otherwise have afforded.
Those eight shootings killed 217 people. The investigations undertaken in their aftermath uncovered a rich trove of information about the killers’ spending. There were plenty of red flags, if only someone were able to look for them, law enforcement experts say.
“Banks will complain this is the government’s job and it’s not our job, but you know what? They are the only ones with the ability to do this,” said Kevin Sullivan, a former New York Police fraud investigator who consults with banks as president of the Anti-Money Laundering Training Academy.
After the shooting last February at Marjory Stoneman Douglas High School in Parkland, Fla., where 17 students and staff members were killed, this column suggested that financial firms had an opportunity to help reduce violence by pushing for more responsible practices by the gun industry. As a result, some banks ended their relationships with gunmakers and some investors pushed manufacturers for more transparency.
Financial firms have so far resisted changing the way they deal with the sale of guns.
Banks and credit-card networks say it is not their responsibility create systems to track gun purchases that would allow them to report suspicious patterns.
“We do not believe Visa should be in the position of setting restrictions on the sale of lawful goods or services,” said Amanda Pires, a Visa spokeswoman. “Our role in commerce is to efficiently process, protect and settle all legal payments. Asking Visa or other payment networks to arbitrate what legal goods can be purchased sets a dangerous precedent.”
A spokesman for Mastercard echoed that sentiment, emphasizing its protection of “cardholders’ independence” and the “privacy of their own purchasing decisions.”
But the financial industry is uniquely positioned to see, if it chose to do so, a potential killer’s behavior in a way that retailers, law enforcement officials, concerned family members or mental health professionals cannot.
57 Purchases in 61 Days
#
A little more than a month before James E. Holmes killed 12 people and injured 70 others at a Century 16 movie theater in Aurora, Colo., in 2012, a psychiatrist was considering having him involuntarily committed. Mr. Holmes quit his job, filed for unemployment benefits and used a new Mastercard issued by USAA to help buy more than $11,000 in weapons and military gear. He bought two tear-gas grenades, a gas mask and filter, a .40-caliber Glock handgun, a 12-gauge shotgun, a .223-caliber AR-15, a 100-round drum magazine, two 40-round magazines, a laser sight, a bulletproof vest, 5,000 rounds of ammunition, two sets of handcuffs and “road stars” meant to slice through car tires.
“This was a civilian making these orders, not the police and not the military,” said Sandy Phillips, whose daughter, Jessica, died in the attack. “Someone should have noticed.”
Read the Previous Columns:
How Banks Could Control Gun Sales if Washington Won’t
Big Investors Have Clout. They Can Use It With Gun Makers.
Citigroup Acted. Now, Two New Ideas on How Banks Can Limit Gun Sales.
Finding Fraud, but Not Firearms
When it comes to certain crimes, banks are on the front lines. They crunch transaction data to protect their customers from fraudulent purchases — often identifying stolen credit cards within seconds — and to detect money laundering, funding of terrorist organizations and other crimes.
Banks are required to report transactions of $10,000 or more by a single person, even if those transactions are legal. And after the Sept. 11 terror attacks, the government enacted even stricter rules under the Patriot Act: Banks must file so-called Suspicious Activity Reports for transactions involving more than $5,000 that the financial institution “has reason to suspect” are part of a plan to “violate or evade any federal law.”
A labyrinth of rules prevents banks and credit-card networks — many of which also handle debit card transactions — from seeing exactly what customers are buying. Retailers have historically resisted providing item-by-item information — known as SKU-level data, a reference to the stock-keeping unit number of an item — for fear that banks would sell that information or use it to steer customers to rival merchants.
In the case of gun purchases, even the nature of the retailer can be obscure: The Merchant Category Code, which identifies the type of store that sold an item, is the same for gun shops and sporting goods stores.
More at ...
https://www.nytimes.com/interactive/2018/12/24/business/dealbook/mass-sho“Banks will complain this is the government’s job and it’s not our job, but you know what? They are the only ones with the ability to do this,” said Kevin Sullivan, a former New York Police fraud investigator who consults with banks as president of the Anti-Money Laundering Training Academy.After the shooting last February at Marjory Stoneman Douglas High School in Parkland, Fla., where 17 students and staff members were killed, this column suggested that financial firms had an opportunity to help reduce violence by pushing for more responsible practices by the gun industry. As a result, some banks ended their relationships with gunmakers and some investors pushed manufacturers for more transparency.Financial firms have so far resisted changing the way they deal with the sale of guns.Banks and credit-card networks say it is not their responsibility create systems to track gun purchases that would allow them to report suspicious patterns.“We do not believe Visa should be in the position of setting restrictions on the sale of lawful goods or services,” said Amanda Pires, a Visa spokeswoman. “Our role in commerce is to efficiently process, protect and settle all legal payments. Asking Visa or other payment networks to arbitrate what legal goods can be purchased sets a dangerous precedent.”A spokesman for Mastercard echoed that sentiment, emphasizing its protection of “cardholders’ independence” and the “privacy of their own purchasing decisions.”But the financial industry is uniquely positioned to see, if it chose to do so, a potential killer’s behavior in a way that retailers, law enforcement officials, concerned family members or mental health professionals cannot.57 Purchases in 61 DaysUSAAMastercardMay 102012Gas maskJames Holmes bought an assortment of guns, ammunition and tactical equipment in the weeks before the Aurora shootingGlockhandgun12-gaugeshotgunJune 1.223 caliber AR-15HandcuffsShotgun sling100-round AR-1otings-credit-cards.html
The New York Times reviewed hundreds of documents including police reports, bank records and investigator notes from a decade of mass shootings. Many of the killers built their stockpiles of high-powered weapons with the convenience of credit. No one was watching.
Two days before Omar Mateen killed 49 people and wounded 53 more at the Pulse nightclub in Orlando, he went on Google and typed “Credit card unusual spending.”
Mr. Mateen had opened six new credit card accounts — including a Mastercard, an American Express card and three Visa cards — over the previous eight months. Twelve days before the shooting, he began a $26,532 buying spree: a Sig Sauer MCX .223-caliber rifle, a Glock 17 9-millimeter semiautomatic pistol, several large magazines, thousands of rounds of ammunition and a $7,500 ring for his wife that he bought on a jewelry store card. His average spending before that, on his only card, was $1,500 a month.
His web browsing history chronicled his anxiety: “Credit card reports all three bureaus,” “FBI,” and “Why banks stop your purchases.”
He needn’t have worried. None of the banks, credit-card network operators or payment processors alerted law enforcement officials about the purchases he thought were so suspicious.
Mass shootings routinely set off a national debate on guns, usually focused on regulating firearms and on troubled youths. Little attention is paid to the financial industry that has become an instrumental, if unwitting, enabler of carnage.
A New York Times examination of mass shootings since the Virginia Tech attack in 2007 reveals how credit cards have become a crucial part of the planning of these massacres. There have been 13 shootings that killed 10 or more people in the last decade, and in at least eight of them, the killers financed their attacks using credit cards. Some used credit to acquire firearms they could not otherwise have afforded.
Those eight shootings killed 217 people. The investigations undertaken in their aftermath uncovered a rich trove of information about the killers’ spending. There were plenty of red flags, if only someone were able to look for them, law enforcement experts say.
“Banks will complain this is the government’s job and it’s not our job, but you know what? They are the only ones with the ability to do this,” said Kevin Sullivan, a former New York Police fraud investigator who consults with banks as president of the Anti-Money Laundering Training Academy.
After the shooting last February at Marjory Stoneman Douglas High School in Parkland, Fla., where 17 students and staff members were killed, this column suggested that financial firms had an opportunity to help reduce violence by pushing for more responsible practices by the gun industry. As a result, some banks ended their relationships with gunmakers and some investors pushed manufacturers for more transparency.
Financial firms have so far resisted changing the way they deal with the sale of guns.
Banks and credit-card networks say it is not their responsibility create systems to track gun purchases that would allow them to report suspicious patterns.
“We do not believe Visa should be in the position of setting restrictions on the sale of lawful goods or services,” said Amanda Pires, a Visa spokeswoman. “Our role in commerce is to efficiently process, protect and settle all legal payments. Asking Visa or other payment networks to arbitrate what legal goods can be purchased sets a dangerous precedent.”
A spokesman for Mastercard echoed that sentiment, emphasizing its protection of “cardholders’ independence” and the “privacy of their own purchasing decisions.”
But the financial industry is uniquely positioned to see, if it chose to do so, a potential killer’s behavior in a way that retailers, law enforcement officials, concerned family members or mental health professionals cannot.
57 Purchases in 61 Days
#
A little more than a month before James E. Holmes killed 12 people and injured 70 others at a Century 16 movie theater in Aurora, Colo., in 2012, a psychiatrist was considering having him involuntarily committed. Mr. Holmes quit his job, filed for unemployment benefits and used a new Mastercard issued by USAA to help buy more than $11,000 in weapons and military gear. He bought two tear-gas grenades, a gas mask and filter, a .40-caliber Glock handgun, a 12-gauge shotgun, a .223-caliber AR-15, a 100-round drum magazine, two 40-round magazines, a laser sight, a bulletproof vest, 5,000 rounds of ammunition, two sets of handcuffs and “road stars” meant to slice through car tires.
“This was a civilian making these orders, not the police and not the military,” said Sandy Phillips, whose daughter, Jessica, died in the attack. “Someone should have noticed.”
Read the Previous Columns:
How Banks Could Control Gun Sales if Washington Won’t
Big Investors Have Clout. They Can Use It With Gun Makers.
Citigroup Acted. Now, Two New Ideas on How Banks Can Limit Gun Sales.
Finding Fraud, but Not Firearms
When it comes to certain crimes, banks are on the front lines. They crunch transaction data to protect their customers from fraudulent purchases — often identifying stolen credit cards within seconds — and to detect money laundering, funding of terrorist organizations and other crimes.
Banks are required to report transactions of $10,000 or more by a single person, even if those transactions are legal. And after the Sept. 11 terror attacks, the government enacted even stricter rules under the Patriot Act: Banks must file so-called Suspicious Activity Reports for transactions involving more than $5,000 that the financial institution “has reason to suspect” are part of a plan to “violate or evade any federal law.”
A labyrinth of rules prevents banks and credit-card networks — many of which also handle debit card transactions — from seeing exactly what customers are buying. Retailers have historically resisted providing item-by-item information — known as SKU-level data, a reference to the stock-keeping unit number of an item — for fear that banks would sell that information or use it to steer customers to rival merchants.
In the case of gun purchases, even the nature of the retailer can be obscure: The Merchant Category Code, which identifies the type of store that sold an item, is the same for gun shops and sporting goods stores.
More at ...
https://www.nytimes.com/interactive/2018/12/24/business/dealbook/mass-sho“Banks will complain this is the government’s job and it’s not our job, but you know what? They are the only ones with the ability to do this,” said Kevin Sullivan, a former New York Police fraud investigator who consults with banks as president of the Anti-Money Laundering Training Academy.After the shooting last February at Marjory Stoneman Douglas High School in Parkland, Fla., where 17 students and staff members were killed, this column suggested that financial firms had an opportunity to help reduce violence by pushing for more responsible practices by the gun industry. As a result, some banks ended their relationships with gunmakers and some investors pushed manufacturers for more transparency.Financial firms have so far resisted changing the way they deal with the sale of guns.Banks and credit-card networks say it is not their responsibility create systems to track gun purchases that would allow them to report suspicious patterns.“We do not believe Visa should be in the position of setting restrictions on the sale of lawful goods or services,” said Amanda Pires, a Visa spokeswoman. “Our role in commerce is to efficiently process, protect and settle all legal payments. Asking Visa or other payment networks to arbitrate what legal goods can be purchased sets a dangerous precedent.”A spokesman for Mastercard echoed that sentiment, emphasizing its protection of “cardholders’ independence” and the “privacy of their own purchasing decisions.”But the financial industry is uniquely positioned to see, if it chose to do so, a potential killer’s behavior in a way that retailers, law enforcement officials, concerned family members or mental health professionals cannot.57 Purchases in 61 DaysUSAAMastercardMay 102012Gas maskJames Holmes bought an assortment of guns, ammunition and tactical equipment in the weeks before the Aurora shootingGlockhandgun12-gaugeshotgunJune 1.223 caliber AR-15HandcuffsShotgun sling100-round AR-1otings-credit-cards.html
