If ATF Industry Operations Investigators showed up at your door tomorrow morning, would you be ready? All FFLs need to be prepared and ready to survive an ATF inspection, whether it’s tomorrow, next week, next month or next year. NSSF Compliance Consultants Judy Bender and Wally Nelson conducted a webinar on preparing for an ATF audit on June 5, 2023. Drawing from their many years of ATF and NSSF consulting experience, they reviewed business practices and compliance procedures that FFLs have and should employ to pass compliance inspections.
“The seminar covered things that FFLs should be doing every single day so they don’t get caught up short,” Bender said. “Most of these are basic things that retailers need to do. For instance, more than one person should be reviewing their records every day.”
What Triggers an Inspection?
One thing Bender and Nelson covered is what might trigger an inspection.
“We will talk about things like a lot of traces, and if there are a lot of guns that were sold recently and are getting traced,” Bender said before the webinar. “If that’s happening, they are selling to people who are straw purchasers, so maybe they need to tighten up their training on that.”
Absentee Owners
One thing that came up is absentee owners.
“This is not a business where you can be an absentee owner,” she said. “You really have to be there daily. If ATF comes in and the owner is not there and is on vacation, you’ve got to have someone there who really knows the system inside and out, because ATF is not going to wait for the owner to come back; you’ve got to have someone there who really knows what’s going on all the time.”
Electronic Record Keeping
Nelson and Bender also covered electronic record keeping.
“A lot of things are going electronic now,” Bender said. “Many retailers are using the electronic 4473, and they need to make sure the employees know the program and know how to help customers with it.”
Follow-up After a Warning Letter
Also, if you’ve had a warning letter or a warning conference, Bender said, there are additional things you should be doing every day and every month to be sure you don’t have the same problem again.
“Once you have that warning conference, the next step is revocation no matter what, if ATF finds that you are doing the same things,” she said. “If you’ve had any action like this, one thing you should be doing is monthly inventories at least for the first year, to be sure your bound book entries are accurate and that there are no missing guns.”
Manufacturer Considerations
Bender said ATF also is starting to take a harder look at what manufacturers are doing.
“Even though retailers don’t have to deal with these things, we are going to talk about a couple of specific infractions that are unique to manufacturers,” she said.
“We’re also going to talk a little about NFA (the National Firearms Act) and the forms that FFLs need to keep that are unique to the registered guns,” Bender said before the webinar. “We’re going to talk about pistol braces [Editor’s note: The pistol brace situation has since changed and continues to evolve]. What I have noticed about those forms when I go into retailers is that they have the registration forms, but they don’t necessarily have them the way the regulations require them to.”
Business Changes
One more big issue that many retailers may not be aware of is business changes that may make their FFL to be invalid.
“Have you changed your corporation?” Bender asked. “Have you gone from a partnership to an LLC? If so, you may need a new license. You may be operating without a license, and if you have NFA weapons, that’s a big problem for you. If ATF comes in and that’s the case, they may seize those guns.”
NSSF Webinars This webinar and others in the 2023 Firearms Industry Compliance Education Series are available for NSSF members to watch online at https://www.pathlms.com/nssf/courses. Not an NSSF Member? Visit NSSF.org/Membership or reach out to the member services team at membership@nssf.org. To learn more about NSSF’s SHOT University Online, visit nssf.org/education.
