FFL DEALERS: dumbfounded by rule during ATF inspection

[ChrisUSMC]

During our recent ATF inspection which was about a month ago we had a real gem of an agent that brought some news to us about doing transfers. If you are conducting a person to person transfer and the buyer gets denied you must perform a background check on the seller before you can hand their firearm back to them . And if that poor seller happens to be from out of state you have to ship the firearm back to a dealer in their state of residence. And if the seller get denied than you literally have to confiscate the firearm until a buyer that can pass a background check comes to get the firearm. I spoke to a couple of dealers near us and they thought I was joking at first. Has anyone else heard of this or had this happen to them.

[Philbert]

I've seen signs to that effect in more than one gun store. As I understand it, there is no such thing as a person to person transfer, officially. There is a seller to FFL transfer followed by a FFL to buyer transfer. Once the seller to FFL transfer takes place, the FFL must comply with the normal ATF rules (background checks, residency etc) in order to transfer that firearm to any unlicensed individual - including the buyer or seller.

[GunLawyer001]

As Philbert correctly notes, the gun is in the bound book during the transfer, and whomever it goes to, it must follow the same rules applicable to any other transfer from the dealer to a person.

That's one of the risks of doing transfers for people, that a guy will want to sell off his gun to a friend, perhaps because he suspects that he himself has become prohibited (lots of prohibited people have guns that they acquired a while back.) So they go to the dealer, start the transfer, and his friend is denied. The dealer then does the PCS check to return the gun, the owner is denied.

The dealer has legal possession of a gun that he can't give back, can't transfer to the friend, and probably shouldn't transfer to anyone that the owner sends in (to avoid a Straw Purchase issue).

FFL's should have a posted policy on what happens next. Usually, the gun goes on consignment and the owner gets the net proceeds. But it can make for some hard feelings as people suspect that the FFL is ripping them off & stealing their gun, when in fact Federal and state laws require that the gun not be returned.

[ChrisUSMC]

We do have signs posted now. Our arguement was that the gun never comes in to the stores possession because we don't put it in our bound book before the transfer is done. She claimed that once we start the paper work it comes into our posession. We didn't argue it's just news to us. Luckly we only had one instance and we cleared that up. i just its seller beware.

[BimmerJon]

We do have signs posted now. Our arguement was that the gun never comes in to the stores possession because we don't put it in our bound book before the transfer is done. She claimed that once we start the paper work it comes into our posession. We didn't argue it's just news to us. Luckly we only had one instance and we cleared that up. i just its seller beware.

I think it's a little scary that as an FFL you weren't aware of this? Even scarier that all the FFL buddies you called didn't know either.
I'm just a regular Joe and I did.

When doing a transfer at an FFL, the firearm is taken possession of by the FFL and entered into their bound book. Then it is transferred to the buyer if they pass NICS/PICS.

Isn't there like a test you have to take to get an FFL?

[Dasbalddog]

Yeah,

Not to bust balls, but I was aware of the fact the gun is being transferred twice during this act, and that should a buyer transfer fail, the seller must pass a check.

I never gave any thought to the out-of-state seller but the cart would follow if I had.

[Hawk]

I ran into this last year at Braverman's (Pittsburgh). I questioned it with them because after doing business with them for over 30 years this was the first time I heard about it.

They warned me (the seller) before the transfer that if the buyer failed PICs they would charge for the failed transfer and also for the transfer back to me at their regular transfer rates. IIRC that would of come to $70. In addition, if I failed they would keep possession of the firearm along with the $70 charge.


I've done transfers at at least 4 other FFL's over the past 30 years. None of these other FFL's ever mentioned this procedure.

[USMC3531]

If it ever happened to me I'd make the "buyer" pay for the transfer back to me, just for wasting my time. I'd do the same if by some chance there was a mix up and I got denied.

[HiredGoon]

Sounds like good details to include in a potential bill of sale agreement with the intended buyer

[OldSchoolPC]

Hypothetically speaking, let's say that the buyer failed, then the seller failed (errantly). So, what happens if the seller just grabs the gun and runs out? Would that technically be against the law? I mean, he can legally own, because after all his background check came up errant. He can't exactly be charged with theft, because he owns the gun. Soooo... couldn't a dealer just leave the gun on the counter and look the other way? Obviously, this would be a bad idea all around, but would that have legal merit?