GE Capital to stop financing gun purchases

Paul Davidson, USA TODAY | USATODAY

General Electric has stopped financing gun purchases, highlighting the wide-ranging impact of the Sandy Hook school shooting in Newtown, Conn. last December and the recent debate in Washington over restricting firearm sales.

GE Capital Finance ceased providing consumer financing for new gun-shop customers in 2008, and recently extended the policy to existing customers. The decision affects fewer than 75 retailers, which GE says is about .001% of all gun retailers.

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The company implemented the new policy "in light of industry changes, new legislation and tragic events that have caused widespread reexamination of policies on firearms," GE Capital spokesman Russell Wilkerson said in an e-mail.

Loans to gun customers is "an immaterial part of our sales volume," Wilkerson added.

Some of the nation's largest lenders don't finance gun purchases.

Wells Fargo stopped the practice in 2004 for business reasons, company spokeswoman Lisa Westerman said. Citigroup doesn't finance firearm loans, says spokeswoman Liz Fogarty. Bank of America would not comment on whether it provides consumer financing for firearms.

GE Capital's new policy affects only retailers that sell firearms exclusively and not general merchandise stores, such as Wal-Mart, that sell guns and other products. Some stores have changed their product mix in recent years to just firearms and the new policy will cut off financing at those shops, Wilkerson says.

Midwestern Firearms of East Peoria, Ill., offers layaway plans for customers but not financing. Still, owner John Meek called GE Capital's move "an injustice as far as their thinking goes — blaming the instrument rather than the perpetrator."

GE is based in Fairfield, Conn., not far from Newtown, where Adam Lanza killed 27, including 20 children, and his mother, before killing himself. Lanza's father, Peter, is a GE executive.

Other companies are also backing away from the gun business after the tragedy. Private equity firm Cerberus Capital Management has said it wants to sell Freedom Group, which manufactures Remingtons, Bushmasters, Marlins, H&R and other well-known firearm brands.