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ATF’s FFL Revocation Hearings

The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) grants licenses to persons engaged in dealing, importing, and manufacturing firearms. The ATF also investigates violations of laws and regulations by those licensed to engage in those businesses.

Federal Firearms Licensees (FFL) must comply with the Gun Control Act (GCA) and accompanying regulations to protect the public, cooperate with law enforcement agencies, allow for the tracing of firearms, and prevent the diversion of firearms from a legal market to an illegal market.

FFLs are subject to inspections by ATF industry operations investigators (IOI).

If an ATF IOI conducts an inspection of your business, it might identify regulatory violations. When the inspection uncovers violations, the IOI issues a “Report of Violations” to ensure corrective actions are taken, educate the FFL, and discourage future violations.

When the violations are willful, the ATF might take steps to revoke the FFL. The courts have defined “willfulness” as an intentional disregard of a known legal duty or plain indifference to a licensee’s legal obligations.

ATF may revoke a firearms license if a licensee willfully violates the Gun Control Act or its associated regulations. See 18 U.S.C. § 923(e) and 27 C.F.R. § 478.73(a). In fact, the ATF could revoke a license based on one willful violation alone.

The courts have found that the willfulness requirement is met by plain indifference toward known legal obligations if the FFL knew of the requirement or knew generally that his failure to act would be unlawful. Even circumstantial evidence might be enough to establish this state of mind.

Attorney for AFT FFL Revocation Hearings in Florida

What happens when the ATF wants to revoke the FFL because of wilful violations of federal laws and regulations, including the implementing regulations of the Gun Control Act (GCA)?

An attorney can help you understand how to challenge an attempt by the ATF to revoke a federal firearms license (FFL), federal explosives license (FEL), or federal explosives permit (FEP).

We can help you request a hearing to challenge the allegations in the Notice of Revocation. If you received a Final Notice of Revocation you only have sixty (60) days to file a petition pursuant to 18 U.S.C. § 923(f)(3), for judicial review with the U.S. District Court for the district in which you reside or have your principal place of business.

Call 813-250-0500.

ATF’s Role in Enforcing Rules for FFLs

Congress enacted the Gun Control Act of 1968 to help prevent prohibited individuals from obtaining firearms.

Anyone who deals in firearms is required to obtain a federal firearms license from ATF as required by the Gun Control Act of 1968, 18 U.S.C. § 923(a), and 28 C.F.R. § 0.131.

The Gun Control Act of 1968 and its implementing regulations establish rules that the FFL must follow. For example, 18 U.S.C. § 923(g) requires the FFL to comply with certain recordkeeping obligations.

The U.S. Attorney General has assigned to ATF the responsibility for enforcing these rules under 28 C.F.R. § 0.130.

ATF IOI Recommendation for FFL Revocation

The first step in the FFL revocation process begins when the IOI recommends revocation as a result of violations uncovered during an inspection.

The most serious violations uncovered during the AFT IOI inspection might include:

  • failure to follow various recordkeeping requirements when they transfer firearms. as required by 18 U.S.C. § 923(g)(1)(A) including:
    • the acquisition and disposition (“A&D”) book
    • the National Instant Criminal Background Check System (“NICS”) inquiry
    • ATF Form 4473
  • refusing to permit ATF to conduct an inspection
  • failing to respond to a trace request
  • falsifying records including a firearms transaction form
  • failing to conduct a required background check
  • transferring a firearm to a prohibited person
  • failure to report multiple sales of handguns
  • failure to maintain records requisite for successful firearms tracing
  • failure to verify and document purchaser eligibility
  • failure to account for firearms

The recommendation for revocation is subject to an internal review process by the ATF’s Directors of Industry Operations (DIO), the ATF field division counsel, and the Deputy Assistant Director of Field Operations (Industry Operations) (DAD [IO]) located at the Bureau headquarters in Washington, D.C.

When the ATF pursues revocation, it must follow the procedures specified in Title 27 Code of Federal Regulations Part 478.

ATF’s Notice of Revocation (ATF Form 4500)

The second step in the FFL revocation process involves the ATF issuing a Notice of Revocation (ATF Form 4500). The notice describes the violations and the reasons the ATF is pursuing revocation.

After the ATF issues the Notice of Revocation, the licensee only has fifteen (15) days from receipt of the notice to request an administrative hearing pursuant to 18 U.S.C. § 923(f)(2). The request for a hearing must be properly filed with the Director of Industry Operations (DIO) in their ATF field division.

An attorney can help you request a hearing, challenge the violations, show the violations were not willful, and present testimony and other relevant evidence.

Demanding a Revocation Hearing to Contest the ATF’s Allegations

If the FFL acts within fifteen (15) days of receiving the Notice of Revocation (ATF Form 4500) by properly demanding a hearing, then a hearing officer is assigned. At the hearing, the ATF is represented by the IOIs who conducted the inspection and the ATF Counsel.

After hearing the evidence, a hearing officer submits a report of findings to the DIO who decides whether to continue with the revocation.

If the DIO decides that the license should not be revoked, then the ATF will notify the licensee in writing.

On the other hand, if the DIO decides that the license should be revoked, then the ATF will issue a “Final Notice of Revocation.” The notice includes a summary of the findings and the legal conclusions that warrant revocation.

The Final Notice of Revocation often provides:

After the effective date of a license denial of renewal, revocation, or suspension, you may not lawfully engage in the business of dealing in firearms. Any disposition of your firearms business inventory must comply with all applicable laws and regulations.

Your local ATF office is able to assist you in understanding and implementing the options available to lawfully dispose of your firearms business inventory.

Appealing the “Final Notice of Revocation”

After receipt of the Final Notice of Revocation, the licensee has sixty (60) days to file a petition for de novo judicial review with the appropriate U.S. District Court pursuant to 18 U.S.C. § 923(f)(3).

Section 923(f)(3) of the Gun Control Act states:

If after a hearing . . . [ATF] decides not to reverse [its] decision to . . . revoke a license, [ATF] shall give notice of [its] decision to the aggrieved party. The aggrieved party may . . . file a petition with [a] United States district court . . . for a de novo judicial review of such . . . revocation. In a proceeding conducted under this subsection, the court may consider any evidence submitted by the parties to the proceeding whether or not such evidence was considered at the hearing . . . . If the court decides that [ATF] was not authorized to . . . revoke the license, the court shall order [ATF] to take such [**10] action as may be necessary to comply with the judgment of the court.

18 U.S.C. § 923(f)(3).

This petition must be filed with the U.S. District Court for the district where the licensee resides or has their principal place of business.

An attorney can help you make a request to the DIO or the courts for the continuance of business operations or stay of action during the appeal.

Failure to file a petition consistent with these guidelines will result in the revocation of the Stay of Action.

Courts sometimes take the position that although § 923(f)(3) directs the courts to conduct “de novo judicial review” of revocation decisions, it confines the inquiry to whether ATF was “not authorized to . . . revoke the license.” See 18 U.S.C. § 923(f)(3).

So the main issue on appeal is whether the ATF lacked the authority to order the revocation.

This article was last updated on Friday, April 1, 2022.

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