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How to Begin Your ATF Compliance Transformation

Written by Orchid


January 15, 2015



In a world of quick fixes, shortcuts, and work arounds, we wonder how things like firearms compliance could be affected. It is true that anything worth having requires “hard work” or that anything worth doing is worth doing “right”. Today we are going to help you further enhance your compliance. It is a process, not a quick fix, regardless of the size of your operation.

Compliance is a process; it doesn’t just happen by chance.  It is an intentional decision and commitment to operating in a way that will affect every facet of your business.  It may not always be the fastest or cheapest way to run the business; but it promotes longevity in a regulated world. There are three main things to remember when beginning a Compliance Transformation:  1.  It helps to start from the top down 2.  Every person and process needs an adjustment 3. It must be assessed, altered, acted upon…and assessed again.

Whether parenting a child or running a firearms business the “do as I say, not as I do” methodology isn’t very effective when asking others to change.  Firearms compliance is no exception.  When an entire business is transforming, it helps to start with direction from the top.  Expectations must be set, guidelines followed, and people held accountable.  From that come policies, procedures, and training.  Employees should know how to complete their tasks compliantly and where to go if they have questions. What if leadership of a company didn’t follow the established security protocol that everyone else has to deal with daily?  The affect trickles down from the top.  If leadership of the business operates in a compliant manner, it sets the tone for others to follow.  It sends the message that, that is how things are done.  It demonstrates the compliant culture of the business, whether there are thousands of employees or only three.

Along those same lines think of all of the daily operations that go into running a firearms business.  For dealers it may include opening the store, receiving product in, making the acquisition entry into the A&D Book, displaying product, completing transfers including the processing of the ATF F 4473 or shipping firearms to other FFLs out of state. These are just a couple of tasks.  For example, one good practice is for the employee who receives the product in to check the firearm serial numbers against the invoice one at a time, making the corresponding acquisitions into the A&D Book timely and accurately, and then displaying the firearms in an orderly manner in the firearm display case.  Sounds great, right?  You have an accurate A&D Book; things are good!  Well, what happens if the employee completing the final transfer to the non-licensee doesn’t review the corresponding ATF F 4473 and forgets to write in the firearm information?  He then can’t remember which firearm it was he sold, so he can’t make the corresponding disposition in the A&D Book.  What started off as a very compliant transaction could end in several ATF violations.  A culture of compliance incorporates a commitment at every level.

So how do you know if it’s working?  Do you wait for the ATF IOIs to tell you that during a compliance inspection?  Most likely, if you are making efforts to get and stay in compliance you want to know that prior to your inspection so that if things aren’t working, you have time for change. Here is where internal or 3rd party audits come in.  Two of which you may consider are NSSF FFL Self Audit Guide or Orchid Advisors independent assessment of your Compliance. Frankly, we would suggest both.  To minimize your risk, someone within your business should regularly be reviewing your A&D Book for deficiencies, conducting serial number based inventories, reviewing your transfer paperwork, etc.  Issues of non-compliance tend to snowball and create more than one problem.  The sooner you catch these deficiencies and reconcile them, the better.  Fixing the records however, is only half the battle, it is also important to figure out why it happened in the first place.  Was it sloppiness or something more?  Conducting “ATF-styled” inspections is important to see where you stand and what violations you may be cited for at that point in time.  If you determine there are compliance gaps in your operations its time to enhance your internal controls to ensure future compliance.  Alter the process to include things such as further validation, more advanced technology, or increased oversight.  Find ways to make these operations more compliant and then bring it to action and try again.

Remember “Assess, Alter, Action” and repeat.  Keep in mind that this is a process of continuous improvement.  Don’t be overwhelmed; you can do it!       

For more information contact Orchid Advisors of NSSF or guidance or independent assessments.