Internal Mock ATF Inspections Can Save Your FFL From Revocation

ATF has served more than double the Notices of Revocation in the past two fiscal years than were issued in 2020 and 2021. We have discussed these actions by ATF under the direction of the DOJ and Administration in the White House, numerous times. The threat is real and you, as a Responsible Person on your FFL, need to have a plan to be ready for the day ATF walks in your front door. Let me be crystal clear – this is a matter of WHEN, not if. If you haven’t seen the ATF for a compliance inspection recently, your turn in the barrel is coming and coming quickly.

• Are you ready?
• If you think you are, how do you know you are?
• What steps have you taken and continue to take every day to ensure that your stress level doesn’t increase the day ATF arrives?
• If you know you aren’t ready, how can you get ready and get ready fast?

Preparing for an Inspection

Yes, you can be ready for an ATF Compliance Inspection. Making compliance a cornerstone of your business structure and daily operations is critical. Creating a culture that compliance comes first will set you and your business up to maximize sales and profit while allowing you to sleep well at night knowing it doesn’t matter if ATF shows up in the morning. Being ready for ATF means you inspect what you expect from your store team. The goal of being perfect and using technology to assist you in being perfect are great starting points. However, you can’t just assume it is being done or that your goals are being met in your store.

Set expectations and memorialize these policies and procedures in your business’s SOPs (Standard Operating Procedures). Train every member of your staff in these SOPs and maintain documentation of this training to ensure your team knows how important compliance is to your business. This also gives them a roadmap of your defined procedures so they can be successful in keeping your FFL compliant.

Having taken these steps, you now need to validate that your direction and expectations are being met. There is no silver bullet to check up on your team and their execution that drives the compliance health of your FFL. Some FFLs “audit” themselves yearly, or quarterly. These can be great starting points, but also leave a lot of calendar space between checkups. When you self-audit and find something that needs to be addressed, having a year or three months of day-to-day business to review leaves your path to reconciliation much more difficult. The more often you self-audit, the smoother your internal audits will be and the easier they will be to reconcile.

Key Pieces Your Audit Should Include

• Inventory
  • Bound Book to Gun and Gun to Bound Book.
  • Always verify the steel of a firearm to the information in your bound book.
  • Verify Manufacturer, Importer (If Any), Model, Caliber/Gauge, Type and Serial Number.
    • All this information is regulated, will be checked by ATF during a compliance inspection and can cause violations during an ATF inspection, so do the same!

Why look at inventory from both perspectives? Simple. Doing so will ensure you are not short on any firearms that you SHOULD have (Bound Book to Gun) and that you don’t have firearms in your possession that have NOT been acquired into your Bound Book (Gun to Bound Book).

PRO TIP:

“Verifying the regulated information required to be in your bound book when a firearm is received and having a process to “reseal” the box in a manner that has the date and name of the employee who verified the information will allow you to scan S/Ns to account for all your firearms and speed up your regular monthly audits.”

This may go without saying, but we are going to say it anyway! Be sure you use proper, safe firearms handling procedures when your team executes this procedure. Also, ensure the team who verifies the Bound Book information is trained on the required firearm markings on the firearms themselves. If they don’t know what they are looking at and what those markings mean, it won’t matter that they are verifying it.

ATF Audit Checklist

• Licensing/Signage
  • Is A COPY of your FFL signed and posted in a conspicuous location?
    • Where is your Original FFL? Ensure it is NOT signed!
    Do you have the required Youth Handgun Safety Poster posted in clear view of customers?Are your Youth Handgun Safety Pamphlets available to ALL customers?
  • State Required Signage – this can vary depending on your location.  However, if your state has requirements, verify you meet them.
• Records
  • Inspect your 4473s – look for mistakes that can lead to ATF inspection violations.
    • The expectation of being perfect on your paperwork starts here.Review every line, not only to ensure it is complete, but ensure the data/information is accurate.
      • i.e. County – just because it is filled out doesn’t mean it is correct. One of the most common errors is a customer misreading this line and thinking it says “country” and entering USA, or United States.
      What addendums should be attached to the 4473 you are reviewing?
      • ATF F 3310.4 or 3310.12
        • Not only is the form attached, but did the proper notification happen? And did it happen within the timeframe specified?
        ATF F 5300.9A
        • Sell more than three firearms to the same person on the same transaction? This form must be attached!
        Non-immigrant Alien Exemption Documentation
        • You are required to not only document this on the 4473 itself, but you are also required to attach a copy of this document to the 4473 as well.
        Have any corrections been made to the 4473 after the form was completed?
        • If so, these corrections, per the instructions on the 4473, must be done on a copy of the original 4473 and attached to the 4473.
      Verify that each firearm you list as transferred to the customer on the 4473 is also disposed of to the customer in your bound book.
  • You are required to maintain three distinct folders or files of 4473s:
    • Transferred – the firearm(s) was physically transferred to the customer. Denied – this file is specific to 4473s in which NICS or the State POC denied the transaction.
    • the Void/No Sale – any 4473 that is started in your store that does not fall into the two above categories must be retained in this format.

NOTE – as of August 2022 and the release of ATF Ruling 2021R-05F you are required to retain every 4473 that is started in your store/FFL for the life of your business.

If you review, inspect, and treat each segment of an ATF compliance inspection in the same manner that ATF reviews and inspects each, you will know if you are ready for them to walk in the front door.  The only way you will know if you are ready is by performing an internal mock ATF inspection.

With revocations at an all-time high and with the requirement to keep 4473s forever, you cannot afford to NOT use technology to mitigate your compliance risk. Using an electronic Bound Book and e4473 can reduce your potential errors by well over 90%.  Add in the benefit of storing your 4473s digitally with 4473 Cloud and the switch is a no-brainer. There is literally no reason not to step into the 21^st century and allow the experts to help you maintain your compliance!

INSPECT what you EXPECT from your team and use technology to make those internal mock ATF inspections a breeze! Once you know you are ready for ATF, take a moment and consider getting an independent third party to validate your results and sleep well at night, knowing that when it is your turn for ATF to inspect your FFL, it will be just another day at the office!

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