Credit Card Processing Company Rejects Firearms Industry

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Received a reply from them today. It is basically a non-answer.


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.

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

The information in this message may be proprietary and/or confidential, and protected from disclosure. If the reader of this message is not the intended recipient, or an employee or agent responsible for delivering this message to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please notify First Data immediately by replying to this message and deleting it from your computer.
 
are they aware that there is no such thing as a non face to face sale when dealing with firearms? it may not be a CDNN employee who is FTF with the end customer, but someone with an FFL certainly will
 
I find First Data's explanation to be highly suspect. If their policy is that only face-to-face transactions are acceptable because of possible fraud, why is there no crackdown on companies such as Amazon.com, Ubid.com or Tigerdirect.com, all of who sell other kinds of merchandise? If First Data want to enforce this policy they should withdraw from ALL online transactions of ANY kind where the transaction is not face-to-face. It will be a cold day in a very warm place when this happens. What they are trying to do is an attack against the firearms industry alone.
 
I was skeptical at first given my dislike for CDNN and the seeming bias of the original article but the above letter from Citi seems to be quite revealing of the situation. I'll have to write citi as an otherwise happy customer.
 
First Data is a privately held company. Here is the owner's web site: http://www.kkr.com/

I doubt writing them would help any. I think telling the banks that First Data's "ideals" are going to hurt THEIR business might get more response.

Kohlberg, Kravis and Roberts, rings a bell. Oh yeah! It's the same assho**s that bought a local energy company for $900 million and flipped it for $5 billion dollars. The deal was so underhanded and sleazy, that now Texans, due to energy deregulation have to pay higher electric bills because of that. Sure it is perfectly legal, but i don't really think they care all that much. Thanks for the exploitation %#$@*&!!

http://www.iht.com/articles/2005/11/23/business/power.php
 
During a phone conversation that Mr. Crawford had with First Data, First Data told him he was no better than someone running a brothel, and that if his actions selling guns was not illegal then it was certainly immoral and First Data would have nothing more to do with them.

I wonder how much of the multi-gazillion dollar online pornography business First Data refuses to process? :banghead:

Self-righteous hypocrites!
 
I came upon this fiasco via an NRA Alert today.

I tried calling the credit card outfit, at phone numbers listed and essentially was "run around the telephone tree", to use a polite phrase. Dropped an e-mail to National Shooting Sports Foundation, thir information was included.

Seems as if the credit card mafia thinks that gun seller is operating illegally, or making sales in violation of the law. If this were true, it seems to me that the relevant LE outfits (BATFE) would become involved.

What's up does appear to be a reasonable question.
 
Cannot believe that CDNN continued to to do business with Citi-Bank after they were placed on the NRA list of organizations who support gun control.
 
Possibly a little "off point", but never-the-less interesting.

Wasn't CITI Group caught on the "wrong side" of this sub prime debacle. I believe that one of their top management types was dumped, of course, with suitable golden parachutes, as was an executive from Merrill, which used to be Merrill Lynch and so forth and so on, but that was a while back, when they had a much longer name, as in Pierce, Fenner and Beane or Smith.
 
"Wasn't CITI Group caught on the "wrong side" of this sub prime debacle."

Big time!!! They lost their butts. It is somewhat off topic. However, all the furor over guns may have been generated during Citi's efforts to re-organize.

"FOR IMMEDIATE RELEASE
Citigroup Inc. (NYSE: C)
November 04, 2007

Citi's Sub-Prime Related Exposure in Securities and Banking

New York, NY – Citigroup Inc. (NYSE: C) announced today significant declines since September 30, 2007 in the fair value of the approximately $55 billion in U.S. sub-prime related direct exposures in its Securities and Banking (S&B) business. Citi estimates that, at the present time, the reduction in revenues attributable to these declines ranges from approximately $8 billion to $11 billion (representing a decline of approximately $5 billion to $7 billion in net income on an after-tax basis).

These declines in the fair value of Citi's sub-prime related direct exposures followed a series of rating agency downgrades of sub-prime U.S. mortgage related assets and other market developments, which occurred after the end of the third quarter. The impact on Citi's financial results for the fourth quarter from changes in the fair value of these exposures will depend on future market developments and could differ materially from the range above.

Citi also announced that, while significant uncertainty continues to prevail in financial markets, it expects, taking into account maintaining its current dividend level, that its capital ratios will return within the range of targeted levels by the end of the second quarter of 2008. Accordingly, Citi has no plans to reduce its current dividend level.

The $55 billion in U.S. sub-prime direct exposure in S&B as of September 30, 2007 consisted of (a) approximately $11.7 billion of sub-prime related exposures in its lending and structuring business, and (b) approximately $43 billion of exposures in the most senior tranches (super senior tranches) of collateralized debt obligations which are collateralized by asset-backed securities (ABS CDOs).

Lending and Structuring Exposures

Citi's approximately $11.7 billion of sub-prime related exposures in the lending and structuring business as of September 30, 2007 compares to approximately $13 billion of sub-prime related exposures in the lending and structuring business at the end of the second quarter and approximately $24 billion at the beginning of the year.1 The $11.7 billion of sub-prime related exposures includes approximately $2.7 billion of CDO warehouse inventory and unsold tranches of ABS CDOs, approximately $4.2 billion of actively managed sub-prime loans purchased for resale or securitization at a discount to par primarily in the last six months, and approximately $4.8 billion of financing transactions with customers secured by sub-prime collateral.2 These amounts represent fair value determined based on observable transactions and other market data. Following the downgrades and market developments referred to above, the fair value of the CDO warehouse inventory and unsold tranches of ABS CDOs has declined significantly, while the declines in the fair value of the other sub-prime related exposures in the lending and structuring business have not been significant."
 
alsaqr:

Re the "relationship" between First Data and CTI, could be that the apple does not fall all that far from the tree after all.
 
Citi's letter to to NSSF
NSSF reply to Citi

I was recently made aware of the anti gun policies of both First Data, and Citi services with regard to their treatment of Federal Firearm Licensed dealers (FFL's) in non "face to face" transactions of firearm sales.
Even after you have been made aware of the fact that these transactions are perfectly legal and routine, your company insists on maintaining its misguided and self destructive policy.
Until you change your policy on this issue, and issue an apology, I will not be using your credit card in the future.
I will also be encouraging my friends and business associates to do the same.
I'm sure you are aware of the fact, that several websites throughout the country are now disclosing your unfortunate bias to millions of legitimate, lawful gun owners, and sport shooting enthusiasts.
The result of which can only help to supplement Citi bank's already dismal financial performance made public in the last few days.

Their form letter reply:
Thank you for your message.



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.

...And, mine to them:
It may be your policy, but mine is not to use your credit card until you apologize publicly, after you change yours!
..."Non face to face" transactions are perfectly legal between FFL's, and Citi bank doesn't write the laws!
...Indeed, it is apparent, that you can't even run a bank.
 
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Do not demonize Citibank in all of this mess. They had nothing to do with it. First Data establishes the underwriting criteria and manages each account.
 
Do not demonize Citibank in all of this mess. They had nothing to do with it. First Data establishes the underwriting criteria and manages each account.
Citi's name is on the door, so they're gonna get the beating. The fact Citi has not come out and said, "This is First Data's policy, not ours" also speaks volumes.

Who gets the bad press and takes it on the chin when an automaker has a recall? The automaker, not the subcontractor who actually made the defective part.

And for business school students, this is why it is important you perform due diligence when licensing your brand name.
 
As I understand it, First Data is owned and part of Cit. :uhoh:

So far all of the public statements coming out from Cti support the policy of no non face-to-face credit card transactions in firearms sales. They ignore the fact that no firearm is delivered without the face-to-face exchange that they demand does happen, even though it is with the receiving FFL dealer rather then the seller. If Cti's policy should become a banking/credit card industry standard most gun sales would be restricted to nothing but local retailers (excluding private sales in some cases) and this is what the anti-gunners' want.
 
Citi did a similar deal a few years ago to a gunsmith (can't remember the name right now).

They have some real issues with logic in my mind.

Ever since then, whenever I get a card offer from them I just put a few NRA stickers on it and mail it back to them. That way they get to pay for the return postage and should get a subtle message if they get a pile of them each day.
 
As I understand it, First Data is owned and part of Cit.
Incorrect.
http://ir.firstdatacorp.com/
Effective September 24, 2007 First Data was acquired by an affiliate of Kohlberg Kravis Roberts & Co.


ETA:
https://www.firstdatapartners.com/citi/about.php
Citi Merchant Services Provided by First Data Merchant Services Corporation is a contractual alliance in the U.S. between Citicorp Payment Services, Inc. (CPSI), a wholly-owned subsidiary of Citibank, N.A., which, in turn, is a wholly-owned subsidiary of Citigroup (NYSE: C) and First Data Merchant Services Corporation (FDMS), a wholly-owned subsidiary of First Data Corporation (NYSE: FDC). FDMS will provide all the systems, technology, processing services and customer support to the alliance.

ETA 2: I am not absolving Citi for their role in this. I'd hold them just as responsible as First Data.
 
Citi Merchant Services Provided by First Data Merchant Services Corporation is a contractual alliance in the U.S. between Citicorp Payment Services, Inc. (CPSI), a wholly-owned subsidiary of Citibank, N.A., which, in turn, is a wholly-owned subsidiary of Citigroup (NYSE: C)

...and First Data Merchant Services Corporation (FDMS), a wholly-owned subsidiary of First Data Corporation (NYSE: FDC)

So does anyone know who is on first... ?? :banghead:

Cti would seem to be the public face with which NSSF is dealing. I highly doubt that one would get away doing what they are if both weren't in agreement, and there is no evidence that either is in disagreement with the other over this issue...

That's enough for me. :fire:
 
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