New York Attorney General Letitia James is leading a bipartisan coalition of attorneys general in a renewed effort to curb illegal vaping sales, warning that major payment platforms are inadvertently helping fuel youth access to unauthorized e-cigarettes.
In letters sent to leading financial companies, including Visa, Mastercard, PayPal, and Stripe, James and officials from 24 other states called for immediate action to block transactions tied to unlawful vape sales.
“Right now, vape sellers are using mainstream payment systems to sell products that shouldn’t be on the market in the first place to kids,” James said. “If you are helping process the payment, then you are part of the pipeline.”
A Hidden Gateway to Youth Access
The coalition argues that while enforcement has traditionally focused on retailers and distributors, payment processors represent a critical, and often overlooked, link in the chain.
Under federal law, e-cigarette products must be authorized by the U.S. Food and Drug Administration before being legally sold in the United States. Currently, only a limited number of products, primarily tobacco- and menthol-flavored, have received approval.
Yet, according to the coalition, the majority of vaping products available online and in stores do not meet these requirements, making their sale illegal.
Despite this, such products continue to reach consumers, including minors, often through online transactions processed by major financial platforms.
Legal Framework and Compliance Gaps
Officials also pointed to the Prevent All Cigarette Trafficking Act, which requires online sellers to verify customer age, register with authorities, and comply with state and local regulations. Investigations have found that many retailers fail to meet these standards, undermining safeguards meant to prevent underage access.
State-level restrictions further complicate the landscape. In places like New York, flavored vaping products are banned, and several states prohibit direct-to-consumer shipping. However, unauthorized products continue to be sold and delivered, often slipping through regulatory cracks via digital payment systems.
A Call for Industry Accountability
The coalition is urging payment processors to take a more proactive role by identifying and cutting off merchants that violate federal and state laws. Proposed measures include banning noncompliant sellers from using their networks and strengthening transaction monitoring systems.
Officials stressed that collaboration between government and the private sector has proven effective in the past. A similar initiative in 2005, also led by New York, successfully reduced illegal online cigarette sales by working directly with credit card companies.
Ongoing Enforcement Efforts
James’ office has been actively pursuing enforcement actions against illegal vaping operations. These include lawsuits against major distributors, legal action targeting local vape shops accused of selling to minors, and a landmark $462 million settlement with Juul Labs over its role in the youth vaping crisis.
Despite these efforts, officials say enforcement alone is not enough.
“The scale of illegal vape sales today requires cutting off access at every point in the supply chain,” the coalition stated, explaining that payment systems are uniquely positioned to disrupt these transactions at their source.
A Broader Public Health Concern
Public health experts warn that youth vaping remains a significant concern, with unauthorized products often marketed in appealing flavors and sold with minimal oversight. By targeting the financial infrastructure behind these sales, regulators hope to reduce availability and protect younger consumers.
The coalition has requested a formal meeting with the companies to discuss next steps, signaling what could become a major shift in how illegal online sales are policed in the digital economy.
