INDUSTRY NEWS: V16N3

ATF ANNOUNCES THE PRELIMINARY RESULTS OF ITS MULTIPLE SALES REPORTING (MSR) PROGRAM

By Robert m. Hausman

The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) announced the preliminary results of its Multiple Sales Reporting (MSR) program for certain types of rifles after the first eight months of operation. From approximately mid-August 2011 through mid-April 2012, there were more than 3,000 reports submitted from Texas, New Mexico, Arizona and California. These reports accounted for the purchase of more than 7,300 rifles. Texas led the four states with more than 1,900 multiple sales reports accounting for more than 4,600 rifles purchased. During the same eight-month period, ATF opened more than 120 criminal investigations based on multiple sales reports. More than 25 cases have been recommended for prosecution representing more than 100 defendants with various firearms-related charges.

Early indications show large-volume sales of rifles (10, 20, 30, or more in a single purchase) are not occurring as often, according to multiple sales reports and through interviews with ATF special agents and investigators in those states. Individual purchases are much smaller and usually in the lower single digits. While no baseline numbers of multiple purchases are available, since this is the first required reporting of its kind, it appears firearms traffickers are aware of the new reporting requirement and are altering their criminal activity.

In August 2011, ATF started the MSR program requiring Federal Firearms Licensees (FFLs) in Arizona, California, New Mexico and Texas to submit reports of multiple sales of certain rifles or other dispositions to unlicensed individuals who within five consecutive business days acquired two or more rifles that were semiautomatic, had a caliber greater than .22, and those with the ability to accept a detachable magazine. A similar rule requiring dealers to report multiple hand-gun sales has been in effect since 1975. The federal statute that codified multiple sales of handguns reporting requirement went into effect in 1986.

In fiscal year 2010, there were 36,148 reports of multiple sales of hand-guns, submitted by 2,509 FFLs in the four southwest border states of Texas, Arizona, California and New Mexico.

Federal Firearms Licensees by State 2011

The following is a listing of the FFL-holding population during 2011 in the various states:

Alabama: 2,103
Alaska: 997
Arizona: 2,723
Arkansas: 1,812
California: 7,535
Colorado: 2,361
Connecticut: 1,643
Delaware: 314,
District of Columbia: 27
Florida: 6,374
Georgia: 3,362
Hawaii: 254
Idaho: 1,283
Illinois: 4,349
Indiana: 2,667
Iowa: 1,916
Kansas: 1,759
Kentucky: 2,241
Louisiana: 1,931
Maine: 861
Maryland: 2,495
Massachusetts: 3,290
Michigan: 4,055
Minnesota: 2,639
Mississippi: 1,362
Missouri: 5,990
Montana: 1,423
Nebraska: 1,085
Nevada: 1,188
New Hampshire: 1,018
New Jersey: 481
New Mexico: 1,026
New York: 3,774
North Carolina: 3,966
North Dakota: 611
Ohio: 4,446
Oklahoma: 2,189
Oregon: 2,376
Pennsylvania: 5,649
Rhode Island: 452
South Carolina: 1,899
South Dakota: 691
Tennessee: 3,086
Texas: 8,912
Utah: 1,071
Vermont: 538
Virginia: 3,813
Washington: 2,529
West Virginia: 1,337
Wisconsin: 2,830
Wyoming: 770
Other Territories: 84
Total 123,587

* Source: Bureau of ATF

Domestic Firearms Production

Year 2007: Pistols 1,219,664, Revolvers 391,334, Rifles 1,610,923, Shotguns 645,231, Miscellaneous 55,461. Total Firearms 3,922,613

Year 2008: Pistols 1,609,381, Revolvers 431,753, Rifles 1,734,536, Shotguns 630,710, Miscellaneous 92,564. Total Firearms 4,498,944

Year 2009: Pistols 1,868,258, Revolvers 547,195, Rifles 2,248,851, Shotguns 752,699, Miscellaneous Firearms 138,815. Total Firearms 5,555,818

Year 2010: Pistols 2,258,450, Revolvers 558,927, Rifles 1,830,556, Shotguns 743,378, Miscellaneous Firearms 67,929. Total Firearms 5,459,240

* Source: Bureau of ATF

The above statistics exclude production for the U.S. military but includes firearms purchased by domestic law enforcement agencies. These statistics also include firearms manufactured for export.

Data is not published until one year after the close of the calendar year reporting period because the proprietary data furnished by filers is protected from immediate disclosure by the Trade Secrets Act. For example, calendar year 2009 data was due to ATF by April 1, 2010, but not published until January 2011.

Firearms Imports into the U.S.

Firearms imports into the U.S. have risen sharply in the last several years as the below analysis demonstrates.

Year 2005: Shotguns 546,403, Rifles 682,100, Handguns 878,172. Total 2,106,675

Year 2006: Shotguns 606,820, Rifles 659,393, Handguns 1,166,309. Total 2,432,522

Year 2007: Shotguns 725,752, Rifles 631,781, Handguns 1,386,460. Total 2,743,993

Year 2008: Shotguns 535,960, Rifles 602,364, Handguns 1,468,062. Total 2,606,386

Year 2009: Shotguns 558,679, Rifles 864,010, Handguns 2,184,417. Total 3,607,106

Year 2010: Shotguns 509,913, Rifles 547,449, Handguns 1,782,585. Total 2,839,947

Year 2011: Shotguns 529,056, Rifles 998,072, Handguns 1,725,276. Total 3,252,404

* Source: Bureau of ATF

Firearms Imported into the U.S. by Country 2011

Brazil: Handguns 359,846, Rifles 381,097, Shotguns 105,676. Total Firearms 846,619

Austria: Handguns 15,396, Rifles 7,191, Shotguns 51. Total Firearms 22,638

Germany: Handguns 265,092, Rifles 46,288, Shotguns 2,148. Total Firearms 313,528

Italy: Handguns 104,911, Rifles 12,222, Shotguns 137,768. Total Firearms 254,901

Russia: Handguns 16,900, Rifles 148,556, Shotguns 50,837. Total Firearms 216,293

Croatia: Handguns 211,001, Rifles 0, Shotguns 0. Total Firearms 211,001

* Source: Bureau of ATF

NFA Tax Revenues Growing

Special Occupational Tax paid by FFL-holders dealing in NFA firearms has been increasing as the following latest available statistics demonstrate:

2006: $1,709,000
2007: $1,815,000
2008: $1,950,000
2009: $2,125,000
2010: $2,530,000

* Source: Bureau of ATF

Gun Dealer Sentenced to 4 years

Charles F. Ludington, age 62, of Parker City, IN, has been sentenced to 48 months (4 years) in federal prison by District Judge Tanya Walton Pratt. This follows Ludington’s plea of guilty to numerous federal firearms charges relating to his ownership and management of a Parker City firearms store. Judge Pratt also ordered that Ludington forfeit the 4,276 firearms, nearly 600,000 rounds of ammunition, and more than $159,000 in cash that were seized by ATF from Ludco Gun Shop in April of 2011.

Charles F. Ludington was the sole owner of Ludco Gun Shop, IN, a dealer located in Parker City, IN. Between August and November of 2010, Ludington’s firearms dealership underwent a routine, periodic audit conducted by agents of the Bureau of ATF. Inspectors discovered that Ludington had acquired but could not account for 997 firearms that were recorded in his inventory.

This audit revealed a whole host of problems. 93 firearms were located in the physical inventory that had not been logged into the record. In more than two dozen instances, a firearm was found in physical inventory but the record reflected the firearm has been sold. Inspectors also uncovered documents suggesting that, on at least seven occasions, Ludco sold firearms to persons who were prohibited by federal law from possessing them. Ludington was additionally cited with selling a handgun to an out-of-state resident in violation of federal law, and numerous other regulatory and record keeping violations. At the conclusion of the audit, the inspectors issued Ludington a warning not to engage in such unlawful conduct in the future.

As a result of this audit, an investigation was initiated in January of 2011. On five separate occasions between January and March 2011, undercover Indiana State Police detectives, ATF agents, and a confidential informant went to Ludco posing as customers. On each of those occasions, Ludington sold firearms despite the fact that someone other than the actual purchaser of the firearms was filling out the mandatory paperwork. This practice is commonly referred to as a straw purchase. In three of those instances, an informant (who is also a convicted felon) informed Ludington that he wanted to purchase a firearm. Ludington knew the purchaser was a convicted felon, yet sold the firearm anyway. Ludington assisted an undercover ATF agent, acting as a straw purchaser, in filling out the required paperwork for the firearms the convicted felon wanted to buy.

Spanish Gun Rights Group Joins IAPCAR

The International Association for the Protection of Civilian Arms Rights (IAPCAR) added the National Arms Association of Spain (ANARMA) as a new member of the international gun rights association working to protect and expand the right to keep and bear arms around the globe. ANARMA joins 19 other groups from 10 countries on five different continents that represent millions of firearm owners and citizens concerned about civilian arms rights.

“Our international coalition is growing by the day with groups like ANARMA as new allies in securing the universal right to keep and bear arms,” said IAPCAR executive director, Philip Watson. “I think the positive dialogue on civilian arms rights is only going to grow as we’ve recently added the Austrian group SPSC and now ANARMA of Spain as new members.” Watson observed.

Julianne Versnel, director of operations for the Second Amendment Foundation (SAF) and Alan Gottlieb, Chairman of the Citizens Committee for the Right to Keep and Bear Arms (CCRKBA) established IAPCAR to serve as a vehicle to unify arms rights groups against international threats to the human right of self-defense and the legitimate use of guns. “IAPCAR strongly opposes any U.N. Arms Trade Treaty that infringes on national sovereignty” said SAF’s Versnel.

The author publishes two of the small arms industry’s most widely read trade newsletters. The International Firearms Trade covers the world firearms scene, and The New Firearms Business covers the domestic market. Visit www.FirearmsGroup.com. He may be reached at: FirearmsB@aol.com.