coreSTORE: FFL - Preparing for Your Next ATF Inspection

Why are you being inspected?
A primary responsibility of the Bureau of Alcohol, Tobacco, Firearms and Explosive (ATF) is ensuring that FFLs engage in their business in compliance with the law. This helps protect the public by preventing illegal firearm trafficking and ensuring the successful tracing of crime guns back to the first retail purchaser.

FFLs must comply with the federal firearms laws and implementing regulations, including the Gun Control Act (GCA) and the National Firearms Act (NFA). These statutes and regulations are designed to protect the public from the criminal use of firearms. GCA regulations include provisions specifically aimed at preventing illegal firearms trafficking and ensuring the successful tracing of guns recovered during criminal investigations (crime guns).

https://www.atf.gov/rules-and-regulations/gun-control-act

https://www.atf.gov/rules-and-regulations/national-firearms-act

1. Who conducts the inspections?

ATF’s Industry Operations Investigators (IOIs) conduct inspections of FFLs to ensure compliance with applicable federal, state, and local laws and regulations, and educate licensees on the specific requirements of those laws and regulations. IOIs also review the required records kept by FFLs to identify individuals potentially associated with illegal firearm trafficking or involved in other criminal activity.

https://www.atf.gov/careers/industry-operations-investigators

One of the ways the ATF ensures compliance is with regular inspections at limited times and for limited purposes. They may conduct an annual compliance and recordkeeping inspection under the GCA, without a warrant, once during any 12-month period.  This is the ATF inspection that FFLs are most likely to encounter.

https://www.atf.gov/firearms/compliance-inspections

2. When and Where

Compliance inspections happen during the licensee’s business hours at their business premises. This may also include the inspection of off-site storage locations, if any.

Generally, ATF will <u>not give advance notice</u> prior to conducting a compliance inspection.

If a licensee refuses to comply by not letting the IOI enter the business premises or inspect their inventory and records, this is considered a willful violation of the GCA and ATF will pursue revocation of the license.

https://www.atf.gov/firearms/revocation-firearms-licenses

3. What to Expect

The IOI will introduce themselves to the licensee, show their ATF credentials, and explain why they’re there. They will also provide their contact information for any follow-up questions.

During an inspection, the IOI will conduct the following activities (not necessarily in this order):

· Review business operations, including ownership and responsible person information

· Evaluate the licensee’s internal controls and security measures

· Verify that licensee is in compliance with state and local laws

· Conduct a complete physical inventory of firearms

· Review the acquisition & disposition (A&D) record, also known as the bound book

· Review ATF forms, including Forms 4473

· Suggest voluntary actions or steps the licensee can take to improve compliance

Listen carefully to everything the IOI is asking and think before you answer. Do not provide any information beyond what is asked for. They use many techniques to indirectly verify how you are conducting business and if everything is lawful as required.

https://www.atf.gov/firearms/qa/what-bound-book

www.atf.gov/firearms/docs/4473-part-1-firearms-transaction-record-over-counter-atf-form-53009/download

4. What should the FFL do?

Once you have been contacted by the IOI take the time to get your records in order and make sure that everything the inspector needs is prepared.  Provide the inspector a place to work and do not impede the inspection process. 

Recommendation:  Contact a consultant, attorney, or other regulatory expert and keep them informed and involved throughout the inspections process.

Be prepared to do the following:

· If doing electronic storage provide the ATF user login to the inspector to access the 4473 and Bound Book in a read only access.  The alternative would be to provide laptops with login access for ATF viewing.  ( coreSTORE - FFL: ATF Inspection Access)

· If printing 4473s, collect the last 12 months of documents, organize them by date (preferred) and stage them for easy access by the inspector.

· Be prepared to report the number of acquisitions and dispositions for the last 12 months.  This can be done through the Bound Book Report.

· As requested, provide a printed version of the Bound Book.  This can be done through the Bound Book Report function.  ( coreSTORE - FFL: Bound Book Report)

· As requested, print a 4473 report.  ( coreSTORE - FFL: 4473 Report)

· Conduct a Serial Count ( coreSTORE - FFL: How to Conduct a Serial Number Count)

5. Inspection Results and Recommendations

Recommendation: The FFL should have a consultant, attorney, or other regulatory expert attend/sit-in (whether in person or via phone) during the Closing Conference meeting at the end of the inspection process to act as a witness and supportive participant as the inspection concludes. It may otherwise be difficult to argue or challenge inspection findings after the fact. There are no formal restrictions as to who can attend the Closing Conference.

At the end of the inspection the IOI go over the final report of violations, if any. The IOI will document the licensee’s response to the violations, including any corrective actions the licensee has taken. The FFL should reply to documented issues to explain and minimize why issues occurred. This can help in the FFL’s defense against any imposed Adverse Action later.

Additionally, the IOI will review the federal firearms regulations also known as Acknowledgement of Federal Firearms Regulations with the licensee, who will have an opportunity to ask questions.

ATF has several ways to guide the FFL toward corrective actions toward future compliance. These methods include issuing a report of violations, sending a warning letter, holding a warning conference (or meeting) or Notice of Revocation (NOR) if violations are found to be willfully committed.

Note: The FFL does not have to sign the inspection results immediately following the inspection summary discussion/closing conference. The FFL can elect to delay the signing to allow for a thorough review of the findings and “respond shortly” to the IOI via email or US mail.

https://regulations.atf.gov/

6. Inspection Preparation

The best way to prepare for an ATF inspection is to have tools and processes that ensure that you are in compliance on a day-to-day basis.

1.  Post your FFL /SOT in a visible place.  Post the Youth Handgun Safety Act poster in the area where you serve the public and have YHSA pamphlets available for handgun transferees. Have locks available for every handgun transfer and available for purchase.

2.  Count your guns! Is the number of firearms (on hand) in your licensed premises equal to the number of “open acquisitions” you have in your Bound Book.  Complete serial number inventory at least quarterly.

3. Make sure all Bound Book entries for acquired and transferred firearms are completed with accurate dates, serial numbers, customer information, FFL transfer information.

4. Organize any outstanding Form 4473s or firearms pending acquisition or disposition (Forms recently completed but not yet disposed) – remember the 7-day deadline for logging guns in and out if you have corresponding business records.

5. Have a process in place that ensures 2 employees review every 4473 prior to the firearm being released to the customer. Mandate that a 3rd person review the completed 4473s before they are filed. Make corrections and updates, as necessary - You MUST have the correct information in the right location on your Form 4473s and in your Bound Book records PRIOR to an inspection.  Anything corrected during the inspection will be documented as “reconciled” but can still count against you as a “citable violation.”

6. Review all Form 4473’s for required Multiple Handgun and/or Long Gun reports that were required. Each must be attached to the qualifying Form 4473, not filed separately. Retain any proof of submittal.

7. Review and complete all Denials for completeness. You are required to keep all Denials/Dealer Cancels (any Form 4473 with a NICS control number in box 27B where the firearm was not transferred).

8. Remove any miscellaneous documents including receipts, copies of identifications, or other “business documents” that are not required to be attached to the Form 4473. The IOI will use your attached documents to find discrepancies on your forms including DL expiration dates, middle initials versus middle names, etc.  File these documents separately and away from your transfer records.

coreSTORE - FFL: Compliance Checklist

Updated on: 03/07/2025