Zero Tolerance Protection: The Cost of Falsifying Records

Written by Orchid

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September 07, 2022

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White text atop black background next to grayscale photo of President Joe Biden

“The truth doesn’t cost you anything, but a lie could cost you everything.”

While some lies can genuinely be harmless, lying as a federal firearms licensee is always a bad idea. As an FFL, lying to the ATF could cost you, your employees, and your business everything. 

One of the most common forms of lying by firearms businesses is falsifying records. Typically involving firearms transactions, intentionally or unintentionally falsifying records is considered a willful violation by the ATF and grounds for license revocation under the Biden administration’s zero tolerance policy.

Records can be forged and fabricated in many ways, but we’ll cover some of the most common means of falsifying records below so you can keep your license.

Fraudulent Transactions

One of the most common ways firearm records are manipulated is through fraudulent transactions. These typically involve transactions where the individual listed on the ATF Form 4473 and submitted for a background check is not the actual transferee/buyer of the firearm, often because the intended transferee/buyer is prohibited from purchasing or possessing firearms by state or federal law. 

Fake transactions can take the form of a straw purchase, where an individual uses someone else to execute a firearm transaction as if they were the true firearm transferee/buyer, or the forging of a Form 4473 using another person’s identity. In either case, knowingly covering up or creating a fake firearms transaction is a willful violation.

Background Checks

In a recent Zero Tolerance Protection series article, we discussed how to respond to NICS background check responses. In most states, FFLs must wait for a response from NICS or a state-appointed Point of Contact (POC) before transferring a firearm. However, forging incorrect responses and faking background checks that were never run are other ways FFLs have falsified records.

When required, background checks must be submitted for every firearms transaction. By lying when a check was run, what the initial or follow-up response was, the NICS transaction numbers (NTN) assigned to the check, or that a check was/was not run at all, are violations of federal regulation and willful violations.

Acquisitions & Dispositions

While record manipulation often happens on Forms 4473 and other ATF documents, it can also happen in an FFL’s A&D bound book. Licensees have been caught falsifying when firearms have been acquired and disposed of – including not at all, who firearms were disposed to, how many firearms are in active inventory, and more.

According to ATF data from 2016–2020, knowingly making false entries in the acquisition and disposition record was the 10th-most cited violation during FFL compliance inspections, racking up more than 1.3 million instances. Meanwhile, failing to timely record firearms manufactured/acquired in the bound book ranked first with nearly 15 million total violations during the same five-year period.

Corrections, Completions & Coaching

Perhaps the most innocent way of falsifying records, correcting transferee/buyer mistakes, completing customer portions of a Form 4473 as the licensee, and coaching individuals on how to complete a 4473 are also all violations.

Sections B and D of the Firearms Transaction Record must only be completed by the transferee/buyer with no influence from the FFL. In addition, making corrections to customer mistakes, such as name, address, responses to prohibited person questions, and citizenship, must only be done by the customer and corrected in accordance with regulation. Similarly, all dates and signatures, including for recertification, must be made by the customer.

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 review how to make corrections to Forms 4473 and your bound book while staying compliant.

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.

Free Zero Tolerance Webinar

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