As a Federal Firearms Licensee (FFL), undergoing an ATF inspection is an inevitable part of operating your firearms business. Understanding the process and being prepared can help ensure a smooth inspection and maintain your compliance with federal regulations. This guide will walk you through what to expect during an ATF inspection, what the inspectors look for, and how to prepare your store to pass the audit.
The ATF Inspection Process
ATF inspections are conducted by Industry Operations Investigators (IOIs) to ensure FFL compliance with federal, state, and local laws and regulations. These inspections typically occur every 3-5 years, though the ATF is prohibited from inspecting a firearms business more than once every 12 months, except in special circumstances.When IOIs arrive at your business, they will:
- Review your business operations, including ownership and responsible person information
- Evaluate your internal controls and security measures
- Verify compliance with state and local laws
- Conduct a complete physical inventory of firearms
- Review your acquisition and disposition (A&D) record, or Bound Book
- Examine all ATF forms, including Forms 4473 (paper and digital)
What the ATF Looks For
During an FFL audit, ATF inspectors focus on several key areas:
Record-keeping Accuracy
The most common violations found during ATF inspections are related to paperwork errors. Inspectors will carefully review your records, looking for:
- Proper documentation of buyer’s ID
- Verification of buyer’s residence
- Accurate recording of NICS contact information
- Correct identification of firearms on Form 4473
- Completeness of Form 4473, Section A
- Proper handling of multiple handgun sales paperwork
Inventory Management
IOIs will conduct a physical inventory of your firearms and compare it to your Bound Book records. They’ll be looking for:
- Discrepancies between physical inventory and Bound Book entries
- Proper recording of acquisitions and dispositions
- Timely updates to your A&D records
Compliance with Laws and Regulations
Inspectors will verify that your business is operating in compliance with all applicable laws, including:
- Federal firearms laws and regulations
- State and local firearms laws
- Proper security measures for firearm storage
Preparing Your Store for an ATF Inspection
To ensure a successful ATF inspection, consider implementing the following practices:
Maintain Accurate and Up-to-Date Records
- Keep your Bound Book current, recording all acquisitions and dispositions on the day they occur
- Regularly audit your own records to catch and correct any errors
- Use electronic record-keeping systems, like E4473, to improve accuracy and compliance
Conduct Regular Self-Audits
- Perform internal audits of your inventory and records
- Compare physical inventory to your Bound Book entries
- Review completed Form 4473s for accuracy and completeness
Train Your Staff
- Ensure all employees understand ATF regulations and your store’s compliance procedures
- Regularly update training to reflect any changes in laws or regulations
Implement Strong Security Measures
- Install proper security systems to protect your inventory
- Develop and follow procedures for secure firearm storage and handling
Be Prepared for the Inspection
- Have a designated area for inspectors to work
- Ensure all required records are easily accessible
- Be ready to provide electronic records in a read-only format if you use digital record-keeping
During the Inspection
When ATF inspectors arrive:
- Cooperate fully with the IOIs
- Have a responsible person available to answer questions
- Take notes on any issues or recommendations provided by the inspectors
After the Inspection
If violations are found:
- Develop a written remediation plan
- Implement corrections immediately
- Adjust your training and procedures to prevent future issues
By understanding the ATF inspection process and maintaining consistent compliance practices, you can ensure your firearms business is well-prepared for an FFL audit. Regular self-audits, accurate record-keeping, and ongoing staff training are key to maintaining firearms compliance and passing ATF inspections with flying colors.Remember, the goal of these inspections is not just to enforce regulations, but also to educate FFLs on compliance requirements and prevent illegal firearms trafficking. By working proactively to maintain compliance, you’re contributing to public safety while protecting your business.
