During our ongoing Zero Tolerance Protection series, we’ve reviewed various willful violations, the inspection process, and the importance of proactive compliance. Throughout, we’ve mentioned the growing threat of license revocation under the Biden administration’s zero tolerance policy. However, we haven’t yet detailed the revocation process or what that means for you and your FFL.
Over the next few articles, we’ll look to do just that – beginning with receiving a revocation notice.
Receiving a Revocation
Following an ATF compliance inspection, industry operations investigators (IOIs) will sit down with licensees to review violations found, if any. Though roughly 60% of all FFLs inspected in the last two years have recorded no violations, at least 40% of you will receive a Report of Violations (ROV) following inspection.
After reviewing the ROV, licensees will sign off on the report in acknowledgment of the violations and ATF will close its inspection. If further corrective action (i.e., warning letter, warning conference, or revocation) is deemed necessary at the discretion of ATF, licensees will receive notice by mail or email.
In the case of revocation, ATF will send the licensee a notice (ATF Form 4500), comprising of a letter informing the FFL their license is being revoked and specific violations cited as a basis for pursuing revocation. Not all violations cited during the inspection may be used as grounds for revocation, but combined, could create an image of willful noncompliance.
The notice will also inform the licensee they have 15 days from receipt of the notice to file a request for a hearing with the Director of Industry Operations (DIO) in their ATF field division to challenge the revocation.
Below is a summary of what you can expect after receiving a revocation notice, and should you choose to fight it. The following procedures are specified in federal regulation (27 CFR 478) and will be explained in greater detail in upcoming articles.
- ATF sends the licensee a notice of revocation that includes violations used as basis for pursuing revocation.
- The licensee has 15 days from receipt of notice to file a request for hearing with DIO in their ATF field division. If no request is made, ATF will send final notice of revocation to the licensee with a summary of findings that warrant revocation.
- If a hearing is requested, DIO will make arrangements for the hearing and advise the licensee of the date, time, location, and name of the officer before whom the hearing will be held.
- At the hearing, the licensee can be represented by an attorney and may bring employees and documentation to address the violations cited in the notice. ATF is represented by ATF counsel and the IOIs who conducted the inspection that resulted in the revocation recommendation.
- During the hearing, the licensee has the opportunity to challenge the violations. Based on the evidence, testimony and exhibits presented at the hearing by the licensee and ATF, the DIO decides whether to continue with the revocation.
- If the DIO decides the violations were willful and revocation is justified, ATF sends final notice of revocation to the licensee with a summary of findings and legal conclusions that warrant revocation. If the DIO decides the license should not be revoked, ATF will notify the licensee in writing.
Orchid Zero Tolerance Protection
At Orchid, our team of operations, technology and legal professionals understand the risks of today’s firearm businesses. For over a decade, we’ve worked with FFLs big and small to implement leading compliance best practices and software solutions to eliminate violations and protect licenses from revocation.
Continuing our Zero Tolerance Protection series, we’ll share our expertise and experience in proactive compliance as we look closer at Biden’s policy and its impact on the firearms industry, review how to avoid and correct violations, and suggest ways to protect your FFL from the risk of revocation. Next, we’ll detail immediate actions you can take after receiving a revocation notice.
In the meantime, learn more about a Zero Tolerance Rapid Assessment of prior ATF Reports of Violations, your A&D Bound Book, and recent ATF Forms 4473. We also encourage you to watch our webinar on ATF zero tolerance enforcement, schedule an in-person or remote mock ATF inspection, and implement leading compliance software in your retail FFL. Contact Orchid today to protect your FFL from a zero tolerance revocation.