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How are Firearm Dealers Impacted by Supreme Court Straw Purchase Ruling

Written by jon rydberg

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June 26, 2014

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How are Firearm Dealers Impacted by Supreme Court Straw Purchase Ruling?
On June 16, 2014, the United States Supreme Court issued its ruling in Abramski vs. U.S., emphasizing that an FFL is forbidden from “selling a gun to anyone it knows, or has reasonable cause to believe, is [a] prohibited buyer.

This decision was a good reminder for dealers to be on guard against straw purchases, and it was solid judicial recognition that FFLs play an important function at the point of purchase.

While your inclination might be to skim or skip this advisory as something you already know, we’d like to encourage that you slow pour your coffee over a chilled glass with just the right amount of ice – it will only take you a few minutes to carefully read this run-down and it could save you from making a costly mistake.

Let’s start with a recap of “federal disqualifying events.  Under 18 U.S.C. 922(g)(1)-(9), there are nine, federal, statutory categories of persons who are prohibited from owning, possessing, or transferring a firearm.  These disqualifying factors categorize the data supplied by states and the federal government about, for example, someone’s prior felony conviction, and trigger a NICS denial.

The Gun Control Act of 1968 contemplates that the buyer will appear in person at the FFL, and that the FFL will verify the buyer’s identify through valid photo ID, will complete the ATF Form 4473, and will submit the information for the NICS background check.  False statements are unlawful, including those which are “knowingly” made or “likely to deceive” the FFL dealer.

Justice Kagan, who authored the majority opinion in Abramski zeroed in on ATF Form 4473, Question 11.a., which asks “Are you the actual transferee/buyer of the firearm(s) listed on this form?”  Her opinion took the time and space to reproduce the boldface warning that is immediately juxtaposed against this question on the form, specifically, “Warning: You are not the actual buyer if you are acquiring the firearm(s) on behalf of another person.  If you are not the actual buyer, the dealer cannot transfer the firearm(s) to you.”

If you are wondering where you got the impression that you could buy a firearm as a gift, Justice Kagan points to the instructions section of that form, which confirms that “You are also the actual transferee/buyer if you are legitimately purchasing the firearm as a gift for a third party.”  The “straw purchaser” is thus someone who buys a gun on someone else’s behalf.

The facts of the Abramski case could lead to no other conclusion.  The Defendant offered to buy a handgun for his relative, thinking he could get a discount on the purchase price by showing his old (invalid) police identification card.  The uncle sent the Defendant the money for the purchase, using a check, and writing the handgun manufacturer and model on the memo line.  Both the Defendant and his uncle were, at the time of the purchase, eligible to buy firearms.

Justice Kagan credits the steps involved in a gun sale as being a “comprehensive” and “elaborate” system, which denies sales to those who are disqualified from ownership and to assist law enforcement with investigation of serious crimes.  Indeed, the majority opinion walks through not once, but three, separate times, the steps and the statutory references required to be followed by the FFL during a potential gun sale.  The Abramski decision emphasized an earlier court decision that the dealer is the “principal agent of federal enforcement” in “restricting [criminals’] access to firearms.”

Court decisions, especially ones from the United States Supreme Court, offer a glimpse into the laws that effect our day-to-day operations.  We conduct our business and our compliance programs through our own frame of reference, one that is honed by on-the-job experience and training from firms like Orchid Advisors and the Firearms Compliance University.  The opinion of a judge is a different frame of reference, one that we might call “theoretical” (i.e., based on legal theory).  But, if we suffer a misstep of compliance, it will be a judge who reviews the facts and applies the law.  It is a critical point of view to understand.

And what of the “bona fide” gift?  The first firearm purchased by a parent.  The wedding present for a spouse.  Nothing in the Court’s opinion in Abramski changed our understanding that a genuine gift would be other than an exception that the purchaser go through identification verification and background check.  The true “gift,” at law, generally involves no money or other valuable consideration being exchanged or anticipated in the future as a result.

We can close today’s advisory with sharing the compliment extended to our industry by the majority Justices of the U.S. Supreme Court.  “It is that highly regulated, legally knowledgeable entity, possessing access to the expansive NICS database, which has the responsibility to “ensure that, in the course of sales or other dispositions…, weapons [are not] obtained by individuals whose possession of them would be contrary to the public interest.”

All firearm dealers, manufacturers, importers and distributors are encouraged to enroll in the online Firearms Compliance University program to optimize their Firearms regulatory and process knowledge. Additional information can be found at Orchid Advisors

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