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INDUSTRY NEWS: JUNE 2004

SAR Staff by SAR Staff
August 2, 2022
in Articles, Articles by Issue, Columns, News & Opinion, Search by Issue, V7N9 (Jun 2004), Volume 7
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by Robert M. Hausman

U.S. Indicts Inter Ordnance Owners German Brothers Charged in 83-Count Criminal Indictment

On February 3rd, Ulrich H. Wiegand, 34, and Oliver M. Wiegand, 37, the owners of Inter Ordnance Of America, L.P., and related companies, were indicted by a federal grand jury in Charlotte, North Carolina on 83 counts alleging conspiracy, illegal importation of machine guns, illegal possession and transfer of machine guns, structuring, and money laundering. The charges involve the Wiegand brothers’ federally licensed firearms business, Inter Ordnance of America, L.P., located in Monroe, North Carolina, as well as foreign companies located in Witten, Germany and Ferlach, Austria, at one time owned and controlled by the Wiegand brothers.

According to the indictment, Ulrich and Oliver Wiegand are German nationals who established Inter Ordnance of America in June 1995 as a firearms importation business and used the business to illegally import machine guns into the United States as machine gun component parts. According to the indictment, the Wiegands also owned and controlled two foreign companies, Wiegand Ordnance GmbH, located in Witten, Germany and Inter Ordnance Waffenhandel GmbH of Ferlach, Austria, which were used by the Wiegands to allegedly illegally import Russian-made PPSh41 machine gun component parts into the United States for subsequent sale by Inter Ordnance of America.

In addition, the indictment alleges that the Wiegands illegally imported FN FAL IMBEL and Steyr MPi69 machine guns. The indictment alleges the Wiegands imported the machine gun components parts knowing that the machine guns had not been destroyed according to ATF specifications. Further, the indictment alleges the Wiegands sold these machine guns as parts kits to customers throughout the United States knowing that the component parts could be assembled as functional machine guns. The government is alleging that the Wiegands sold over 2,000 PPSh41, over 1,000 FN FAL IMBEL and over 500 Steyr MPi69 machine guns as kits to customers throughout the U.S.A.

The indictment also alleges the Wiegands and Inter Ordnance of America structured cash deposits in less than $10,000 increments in order to avoid the filing of currency transaction reports as required by financial institutions. In addition, the government alleges the Wiegands and Inter Ordnance of America used monies from the sales of the illegally imported machine guns in financial transactions to pay importation expenses, income tax expenses, and payments to a German bank account in violation of money laundering laws. The indictment includes a Notice of Forfeiture that asks that the defendants be required to forfeit to the US all of the property involved in the offenses charged in the indictment and all property traceable to such offenses.

The indictment is the result of a two-year investigation by special agents of the Bureau of Alcohol, Tobacco, Firearms & Explosives, the Bureau of Immigration and Customs Enforcement, and the Criminal Investigation Division of the Internal Revenue Service.

An American sales employee of Inter Ordnance, contacted by SAR, said that the company had received prior U.S. government permission to import the parts kits and that the method used to destroy the machine guns had been approved by the government prior to their importation.

The approved methods for the destruction of machine gun receivers has long been a bone of contention between importers and the US government which has not issued clear directives on proper destruction methods for the great variety of machine guns available.

ATF Working on Destruction Diagrams

In late January, representatives of the organization representing American importers, the FAIR Trade Group, met with representatives of the ATF Imports Branch, the Firearms Technology Branch (FTB) and the General Counsel in a continuation of discussions regarding machine gun destruction policy and prospective importation of machine gun parts kits.

This most recent meeting followed an earlier one at which FAIR had discussed recent decisions from the FTB disallowing the use of band saw cuts for destruction of receivers and the evaluation, with a negative bias, of destruction methods that involved removing pieces of the receiver prior to importation. FAIR says these issues were resolved in a manner consistent with prior policy and the interests of the importation industry.

Magazine Makers in Flux

Makers of detachable handgun and rifle magazines who supply their products to the US market report they had a bad year in 2003 and don’t expect to get an upturn in sales before the fourth quarter of this year. The reason? The outcome of the decision by the US Congress on whether or not to renew the magazine capacity limit ban imposed during the Clinton Administration in 1994. Congress has the choice of either renewing the ban by vote, or doing nothing and allowing the law to sunset in November.

Handgun makers in particular have been reluctant to order new 10-round capacity magazines for the medium and large frame handguns in their lines as they are unsure if the law limiting magazine capacity to 10-rounds will be continued. If the law goes away, handgun makers are evidently planning to offer guns with larger ammo capacity.

The NRA is sending out mixed signals on the law’s fate. Wayne LaPierre, NRA’s executive VP says the law will not be renewed, while the NRA’s chief lobbyist, Chris Cox, says he is unsure of how Congress will react.

ATF Disclosure of US Firearms Data Ends

The US Bureau of Alcohol, Tobacco, Firearms & Explosives will no longer release gun-source data or statistical information on Federal Firearms Licensees under the Freedom of Information Act due to an amendment pushed by the National Rifle Association to the Congressional Appropriations Bill.

The NRA lobbied for the amendment as the gun trace data released by ATF was often used by the media and anti-gun groups for phony studies which attempted to draw public and legislative attention to so-called “bad apple gun dealers.”

Release of the information is now prohibited by the appropriations bill passed in January, which provides funding for multiple government agencies including ATF. The bill contained an amendment prohibiting ATF from expending funds to provide information to anyone except law enforcement on FFL-holder records.

The amendment also prohibits a planned ATF move to require FFL licensees to take and maintain annual inventories of their firearms. The Congressional Record, the official federal government newspaper, recently published a proposed ATF rulemaking to require FFL’s to maintain annual inventories as a probable consequence of the Bull’s Eye Shooters’ Supply fiasco from which the so-called “Beltway snipers” obtained their rifle and Bulls Eye’s owner did not know the rifle was missing. However, ATF is now prohibited from implementing the inventory requirement. The amendment also provides that information obtained during background checks of prospective firearms purchasers during the background check process can now be kept for only 24 hours. The former time limit was 90 days.

The Bush Administration and the NRA said the protection of firearms data is needed to ensure the integrity of police investigations and to shield firearms retailers from information that could be unfairly used against them.

Pro gun control groups were quick to condemn the legislation. “This is all part of a calculated strategy to basically shut off the flow of information,” said Dennis Henigan, legal director for the Brady Center to Prevent Gun Violence. “It’s an effort to make sure that lawmakers, scholars, cities, and the general public not have access to information that could actually inform public policy.”

The anti-gun Americans for Gun Safety Foundation is among the research groups that used the data for studies on guns sold by dealers that have been traced by police, although not necessarily involved in crimes. In addition, the city of Chicago, Illinois, was planning to use the trace data as key evidence in its liability lawsuit against gun dealers. One source indicated the amendment prohibiting disclosure brings a two-pronged benefit as it heads off Chicago’s suit and ends the ability of anti-gun groups to “tar and feather” legitimate firearms retailers. The measure was introduced by Rep. Todd Tiahrt (Rep.-Kansas).

Opponents said the Freedom of Information Act already allows agencies to withhold information gathered for law enforcement purposes or that could compromise investigations. Some law enforcement groups supported the changes, while others did not.

Chris Cox, chief lobbyist for the Institute for Legislative Action (the NRA’s lobbying arm), said the changes were “commonsense reforms that simply clarify current law.”

Current firearms trace data first began to be released after the National Association for the Advancement of Colored People (NAACP) won a lawsuit against ATF in 1999. Before that, the information released typically was several years old.

For Chicago, the trace data is at the heart of that city’s liability lawsuit against what it calls “nuisance” firearms retailers, said Benna Ruth Solomon, the head of the city’s appeals division. The Supreme Court sent the city’s lawsuit seeking the trace data back to the 7th Circuit Court of Appeals.

Solomon said Chicago believes it can still get the gun trace data it was seeking since Congress only prevented ATF from spending money to disclose the information and Chicago said it would pay. IFT has already heard from an industry researcher who had made an unsuccessful offer to pay ATF (which had been turned down) after his initial data request made under the Freedom of Information Act was refused.

“Absolutely appalling,” was how Sen. John McCain (Rep. – Arizona) described the data ban during debate in the Senate. “We cannot have a government that operates in secret and refuses to release data showing where criminals have obtained a gun.” Included in the government ban are the invaluable annual U.S. Firearms Manufacturing & Export Reports formerly released by ATF.

Despite the ATF blackout, there is still an industry information source available. The International Firearms Trade, a monthly newsletter published by this author, still has available a wealth of documents in its research archives detailing U.S. firearm production as well as imports and exports. The IFT Library is now the sole source for firearms industry statistical information. For more information, e-mail: INTLFT@aol.com or FAX to 802-751-8268.

Robert M. Hausman is the publisher of the small arms industry’s two most widely read publications, The New Firearms Business, a bi-weekly on the domestic firearms industry and the aforementioned The International Firearms Trade. For subscription information, e-mail to: FirearmsB@aol.com or FAX: 802-751-8268.

This article first appeared in Small Arms Review V7N9 (June 2004)
and was posted online on August 16, 2013

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