Christmas is coming soon!
If you’re already an FFL, you’re likely to have customers looking to purchase a firearm as a gift for somebody else. If you’re not already an FFL, what are you waiting for? You can start the process of getting your FFL today!
Although this is a great time for increased sales, there are some issues that you need to be aware of when it comes to dealing with firearms as gifts.
Purchasing Firearms for Someone Else
Wait, isn’t it illegal to purchase a firearm for someone else? Wouldn’t that be a straw purchase?
Not necessarily. Let me explain…
On the Form 4473, the paperwork for purchasing a firearm from a gun dealer, a purchaser must truthfully answer question 11a (along with the rest of the form, of course) which asks whether the person filling out the form is the actual purchaser:
“Are you the actual transferee/buyer of the firearm(s) listed on this form? Warning: You are not the actual transferee/buyer if you are acquiring the firearm(s) on behalf of another person. If you are not the actual transferee/buyer, the licensee cannot transfer the firearm(s) to you… “
As you may know, a straw purchase is when someone fills out the 4473 for someone else who is actually purchasing the firearm. This is most common when the actual purchaser can’t pass the background check because they are a prohibited person. The prohibited person gets someone, often a significant other, to go into the gun store and pretend like they are the actual purchaser so that the firearm can be purchased for the prohibited person. This is a serious crime!
Unfortunately, the straw buyer often doesn’t know that this is illegal and that they are the one that will get in trouble for the serious crime. The NSSF, the firearms industry trade association, runs a campaign called “Don’t Lie for the Other Guy” in an effort to educate people about straw purchases. First, it keeps unknowing people from being used by a prohibited person to commit a serious federal crime and second, it helps to reduce criminal possession of firearms. This is something that we all want.
Right about now you may be wondering how a firearm can be purchased as a gift without it being an illegal straw purchase. Well, there’s a section in the instructions on the 4473 that help explain how this is possible.
Purchasing a firearm as a gift is allowed, but you’ve got to be careful. It all comes down to who is actually paying for the firearm and whether the purchaser has any reason to believe that the intended recipient is a prohibited person.
Firearms as Gifts
You can purchase a firearm as a gift, and you can give a currently owned firearm as a gift (covered below).
To purchase a firearm as a gift, two important elements must be true:
- You are the actual purchaser
- You have no reason to believe that the intended recipient is a prohibited person.
You must be the actual purchaser of the gifted firearm
This means that it must be YOUR money being used to purchase the firearm and the recipient of the gift is not reimbursing you in any way (money or services). If the person you are giving the firearm to pays you back, then it’s not a gift!
Of course, they can also get you a gift in exchange, but they must truly be gifts and not a planned scheme wherein they are giving you something to cover the cost of the firearm you are buying for them.
The recipient can’t be a prohibited person
This one is kinda’ tricky. Technically, they can be a prohibited person and you still won’t get into trouble ONLY if you have no reason to believe that they are a prohibited person.
For example, if they were dishonorably discharged from the military (among many other things), then they are not allowed to possess firearms nor ammunition. This one is on them. However, there’s also a part of the law that says if you know, or should have known, that they are a prohibited person, then you can get into serious trouble too!
I can easily imagine a scenario where someone you know well might be a prohibited person, and you never knew it nor had any reason to suspect it. If you truly don’t have reason to believe that they are a prohibited person, then you can buy them a firearm as a gift. Please be careful here. If you help get a firearm into the wrong person’s hands, you not only have to live with the fact that you may have helped contribute to a crime, you also may have a hard time defending that you truly didn’t know (or should have known) their status.
So, what about question 11a from the 4473 (above)? Do you select that you are the actual purchaser even if you know that you’re buying the firearm as a gift? Yes!
The instructions on the 4473 explain:
“Question 11.a. Actual Transferee/Buyer: For purposes of this form, a person is the actual transferee/buyer if he/she is purchasing the firearm for him/herself or otherwise acquiring the firearm for him/herself. (e.g., redeeming the firearm from pawn, retrieving it from consignment, firearm raffle winner). A person is also the actual transferee/buyer if he/she is legitimately purchasing the firearm as a bona fide gift for a third party. A gift is not bona fide if another person offered or gave the person completing this form money, service(s), or item(s) of value to acquire the firearm for him/her, or if the other person is prohibited by law from receiving or possessing the firearm.
Actual TRANSFEREE/buyer examples: Mr. Smith asks Mr. Jones to purchase a firearm for Mr. Smith (who may or may not be prohibited). Mr. Smith gives Mr. Jones the money for the firearm. Mr. Jones is NOT THE ACTUAL TRANSFEREE/BUYER of the firearm and must answer “NO” to question 11.a. The licensee may not transfer the firearm to Mr. Jones. However, if Mr. Brown buys the firearm with his own money to give to Mr. Black as a gift (with no service or tangible thing of value provided by Mr. Black), Mr. Brown is the actual transferee/buyer of the firearm and should answer “YES” to question 11.a. However, the transferor/seller may not transfer a firearm to any person he/she knows or has reasonable cause to believe is prohibited under 18 U.S.C. 922(g), (n) or (x). . .”
Therefore, the purchase of a firearm as a bona fide gift to someone that you have no reason to believe is prohibited from possessing a firearm is allowed and the gift-giver (purchaser) should answer “yes” to question 11a. After all, that question doesn’t ask about the intended recipient – it asks whether the person filling out the form is the actual purchaser.
What to Watch Out For
As you likely already know, the FFL can also get into trouble if the customer makes a straw purchase. Yes, the customer is the one breaking the law if they make a straw purchase but FFLs are the first line of defense against this crime.
An FFL isn’t automatically in trouble if a straw purchase occurs. After all, a straw purchase is a deception and the FFL can be fooled too.
However, the FFL is responsible for staying vigilant and doing everything they can to prevent straw purchases. If a straw purchase occurs, the ATF will scrutinize the FFL and the transaction. If the FFL didn’t do enough to prevent the straw purchase or had any reason to believe it was a straw purchase then the FFL gets into serious trouble too!
If you are ever concerned that a straw purchase may be occurring – stop the transaction! I would rather have an upset customer than allow a criminal to get a firearm and risk my freedom and FFL.
Therefore, an FFL must watch out for potential warning signs of a fraudulent transaction. Some of these warning signs include nervousness of the purchaser, having someone else in the store guiding the sale, and making mistakes with information on the 4473. Often, a sure sign of a straw purchase is someone coming into the gun store and reading the firearm description from a piece of paper and demonstrating no knowledge of the firearm.
However, as you can imagine, that could also be exactly how a bona fide gift would be purchased. How are you supposed to tell the difference? Well, I’ve gots some tips and tricks for you.
Tips and Tricks for Buying Firearms as Gifts
If you’re concerned about being able to identify an illegal straw purchase versus a legal gift purchase, don’t allow gift purchases! Instead, insist that gift purchases are done via gift certificates.
Using gift certificates does a few things.
First, it removes the burden from you trying to determine whether a transaction is lawful. It allows the gift-giver to buy a gift certificate, and it allows the recipient to come into your store to use the certificate to actually buy the firearm for themselves. In a weird twist, this could also be a straw purchase – where the gift certificate purchaser is the prohibited person and the person they send in to redeem the certificate is the straw purchaser. So, the system isn’t perfect, but it’s a lot easier for the FFL to size-up the situation.
To help solve this, match the firearm to the end-user. If a guy buys a gift certificate and shows interest in a specific firearm and a girl comes in to redeem the certificate and has no clue about the firearm, that’s a problem.
Second, you might be able to up-sell the transaction! When the recipient comes in to use their certificate, you have the chance to sell them ammunition, accessories, and/or training that never would have been purchase along with the gifted firearm. That’s just good business.
Third, by posting that you have gift certificates available, you might prompt a purchase by an unsure person that never would have otherwise known that was a possibility.
Fourth, you get to get money now for a transaction that might occur later. I wrote might because, as you may know, some gift certificates are never used. That’s even better for business. 🙂
How to Give a Currently Owned Firearm as a Gift
Of course, you may want to give a firearm that you already own as a gift and not need/want to go purchase a new firearm from an FFL. Or, you may have just purchased a firearm for a gift and not know how to actually give it to the person.
As we covered above, you must not have any reason to believe that the recipient is a prohibited person!
If the person is a resident of your state, you can simply give the firearm to them in person as you might any other gift. It is a good idea to keep a record of any firearm you ever give or sell to someone else.
If the person lives in another state, however, you’re going to have to use an FFL in that person’s home-state to transfer the firearm to them. You need to find a local FFL (for them) and then ship the firearm to that FFL. Along with the shipment, you should include a note for the FFL that includes a copy of your driver’s license, contact information for you if there’s any questions, and instructions about who the firearm is for (along with their contact information).
When shipping firearms, be careful. There are different rules for UPS, FedEx, and the US Mail. If you’re in doubt on how to legally ship the firearm, please go to a local FFL (for you) and ask them to ship the firearm for you. They’ll know how to do it properly and it’ll make the transfer process easier.