15 Sep 23

How ATF Investigates Corrupt Firearms Dealers and Licensees

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Last Updated on: 19th September 2023, 07:22 pm

How ATF Investigates Corrupt Firearms Dealers and Licensees

The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) is the main agency responsible for regulating the firearms industry in the United States. This includes inspecting and overseeing the nearly 78,000 federally licensed gun dealers, manufacturers and importers across the country.

ATF agents conduct unannounced inspections of gun dealers to ensure they are following federal laws and regulations. When they find violations, the ATF can take a range of actions – from issuing warnings, to imposing fines, to revoking a dealer’s federal firearms license.

In some cases, ATF investigations uncover evidence of corrupt or rogue gun dealers who are knowingly supplying firearms illegally. This includes dealers who sell guns to convicted felons or domestic abusers, falsify records, or engage in gun trafficking. Such corrupt dealers contribute to the flow of illegal guns that end up being used in crimes.

How the ATF Conducts Inspections and Investigations

The ATF’s over 700 investigators are responsible for inspecting the operations and inventory records of gun dealers across the U.S. These compliance inspections are unannounced and meant to ensure dealers are following laws like:

  • Properly conducting background checks on gun buyers
  • Refusing sales to prohibited purchasers like felons and domestic abusers
  • Reporting multiple handgun sales
  • Maintaining accurate acquisition and disposition records

During an inspection, ATF agents will review a dealer’s paperwork like their A&D book (acquisition and disposition records), trace sales histories, and inventory. They also examine the dealer’s security measures for storing guns.

If violations are found, the ATF can issue a “notice of violations” report. This outlines the dealer’s failures to comply and notes any previous warnings. The dealer then has to provide a written plan describing how they will fix the issues. Follow-up inspections are done to ensure compliance.

If more serious violations are found, the ATF may revoke the dealer’s federal firearms license – effectively shutting down the business. Examples of violations that can prompt revocation include:

  • Failing to account for guns that are lost or stolen
  • Lying or falsifying records
  • Obstructing the inspection
  • Willfully violating gun sales laws

In cases where inspectors suspect corrupt or illegal behavior, they can refer the case for further criminal investigation by ATF. This can include undercover operations, informants, surveillance and search warrants to build a case.

Types of Corrupt Dealer Activity Investigated by ATF

Some of the main types of corrupt gun dealer activity that ATF investigates include:


ATF agents look for dealers involved in trafficking – where guns are diverted from legal to illegal markets. Trafficking accounts for nearly half of crime guns traced by ATF[1]. Red flags include:

  • Selling large quantities of guns that frequently turn up at crime scenes
  • Making repeated sales to the same person or straw purchaser
  • Selling guns far outside their local area

Trafficking cases can involve complicit dealers who conspire with traffickers. But they can also stem from sloppy record-keeping and negligence.

Straw Purchasing

ATF looks for corrupt dealers facilitating straw purchases – where someone buys a gun for another person, often one prohibited from buying themselves. This is one of the top ways guns are trafficked. Dealers may be complicit or just negligent in detecting straw buyers.

Off-the-Books Sales

ATF ensures dealers are properly recording all acquisitions and sales in their A&D book. Failing to log guns allows them to be sold off the books to criminals. Unlogged inventory also signals potential gun trafficking or illegal sales.

Falsifying Records

Intentionally falsifying records – like logging fictitious names of buyers – is a serious violation investigated by ATF. This includes dealers conspiring with gun traffickers to doctor their books.

Security Lapses

Lax security and unsafe storage of firearms is an ATF focus. Stolen guns often end up in criminal hands. ATF has guidelines for safely storing and securing firearms from theft.

Outcomes of ATF Investigations into Corrupt Dealers

ATF investigations into corrupt gun dealers can lead to:

  • License revocation – Shutting down the dealer by terminating their federal firearms license.
  • Fines – Issuing fines ranging from a few hundred to several thousand dollars.
  • Probation – Increased inspections and oversight of the dealer.
  • Warning letters – Documenting violations and expectations for compliance.
  • Criminal prosecution – For corrupt dealers who have committed serious federal felonies.

According to a 2021 investigation, the ATF has often been very lenient with problem dealers – issuing repeated warnings without meaningful consequences. But there are signs this is changing under the Biden administration.