Citigroup Restricts Some Gun Sales By Its Business Customers
(Bloomberg) -- Citigroup Inc. plans to prohibit retailers that are customers of the bank from offering bump stocks or selling guns to people who haven’t passed a background check or are younger than 21.
The bank is imposing the restrictions on companies that use it to issue store credit-cards or for lending and other services, according to a memo Thursday. The lender also barred the sale of high-capacity magazines.
“The policy was designed to respect the rights of responsible gun owners while helping to keep firearms out of the wrong hands,” Citigroup Chief Executive Officer Mike Corbat said in the memo to staff. “It is clear to me that most people believe there are areas of agreement and practical changes we can make to find common ground.”
Citigroup is the first major banking institution to set restrictions on the firearms industry. Some retailers have already scaled back on the sale of firearms since the Feb. 14 mass shooting at a Parkland, Florida high school left 17 dead.
Corbat, who described himself as a responsible gun owner, said the bank would also engage with the few firearm manufacturers that are customers.
Corbat also said the bank would encourage other financial services firms to find technology solutions or come up with voluntary standards that would push more change.
Citigroup, the largest issuer of credit cards in the world, said its policy won’t stop cardholders in its consumer business from shopping at merchants of their choice. The bank’s existing capabilities don’t allow Citigroup to pursue a more targeted approach at retailers’ point of sale, Ed Skyler, a spokesman for Citigroup, said in a separate blog post on the company’s website.
“We know our clients also care about these issues and we have begun to engage with them in the hope that they will adopt these best practices over the coming months,” Skyler said in the blog post Thursday. “If they opt not to, we will respect their decision and work with them to transition their business away from Citi.”
Mark Costiglio, a spokesman for Citigroup, declined to say how many or which clients might be impacted by the new restrictions.
Citigroup wasn’t involved on any debt offerings for publicly traded firearms manufacturers since the Newtown shooting in 2012, according to data compiled by Bloomberg. And among the largest big-box retailers of guns -- a group that includes Bass Pro Shops and its subsidiary Cabela’s Inc., Big Five Sporting Goods, Sportsman’s Warehouse Holdings Inc., and Orvis Co. -- Citigroup did not provide the financing for their co-brand or private-label credit cards.
U.S. Bancorp, which issues Sportsman’s Warehouse’s store card, and JPMorgan Chase & Co. declined to comment on whether they would be changing their policies.
Citigroup’s decision comes days before the March For Our Lives, a gun control rally organized by survivors of the Parkland shooting, and was applauded by the Brady Campaign to Prevent Gun Violence, an advocacy group.
“We give a shoutout to Citigroup and all the other responsible businesses that have been more responsible than Congress in taking steps to prevent gun violence,” Kris Brown, the group’s co-president, said in an emailed statement.
Congress, for the first time in years, plans to vote on gun control legislation as part of a larger spending bill. If passed, the measure would bolster the background check system for gun purchases and potentially open the door for firearms related research funded by the Centers for Disease Control and Prevention.
Walmart Inc. and Dick’s Sporting Goods Inc. said they will no longer sell guns to those under the age of 21 and Dick’s dropped the sale of assault-style rifles entirely. Orvis, an outdoor goods company, said customers will either need to be 21 or show proof of a hunter education and safety course to purchase a firearm.
Several companies have cut ties with the National Rifle Association, the gun industry lobby, in the last month. YouTube announced tighter restrictions on videos involving firearms on Monday, and Reddit on Wednesday banned a variety of communities related to the sale of guns.
Wells Fargo & Co., which has a long-standing relationship with the NRA, thinks addressing the gun epidemic will be complicated and is better left to lawmakers.
“Our company believes the best way to make progress on these issues is through the political and legislative process,” said Alan Elias, a spokesman for the bank. “We are engaging our customers that legally manufacture firearms and other stakeholders on what we can do together to promote better gun safety for our communities.”
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