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Dealers on trial: the risks of sloppy record keeping.

Strict compliance with federal (and state) record keeping requirements is essential as courts increasingly show a kind of "zero-tolerance" when it comes to deciding cases involving alleged violations of applicable rules and regulations under the rationale that dealer (and manufacturer) failures "seriously undermine the effectiveness and purpose of control laws and ultimately endanger society."

It appears simple enough. Each licensed dealer must inventory and record firearms possessed for the business (except where repairing or customizing, or for personal collections) per federal regulations before commencing or continuing a firearms business, as well as keeping proper acquisition and disposition records for sales, purchases, rentals, etc. Licensed collectors must do the same for curios and relics. Record keeping statutes beginning with Title 18 United States Code Service Sec. 921 are fairly straightforward.

But there can be "glitches" with the necessary (yet somewhat burdensome) rules. For one, store owners may be held legally responsible for employees failing to keep required records or to keep them accurately. In a representative case, under a legal doctrine know as respondent superior that holds a "master" responsible for his "servants" while in the scope of employment, violations of record keeping provisions by the manager of a fireams store are attributable to the owner.

The rules had been explained to the owner by BATF on numerous occasions, so he was fully aware of his legal obligation. His unsuccessful defense was that illness had caused absence from the store and at those times employees were left to keep the records. It also didn't help his cause that one of the guns turned up missing and was used in a robbery.

Willful Disregard Or Negligence

Purely innocent acts or omissions can give rise to a finding of "willful disregard" of record keeping requirements, especially when shown a party displayed a pattern of unconcern to correcting recurring problems. Attempts to implement a new computer system at great expense to cure deficiencies immediately prior to a license revocation action wasn't enough to sway the court in one dealer's favor. or was the fact that the employees who weren't diligent in their record keeping duties were fired. This case also involved an employee, a general manager, who handled day-to-day affairs of the business without apparent proper oversight by the licensee.

Usually improvement (or lack of improvement) in record keeping directly relates to whether violations are considered "willful." Courts note willfulness does not require bad purpose, evil motive, or malicious intent as one might anticipate, but only typically that a seller knew the legal obligations and purposely disregarded them or was plainly indifferent to requirements of law, and particularly where notification is received that future violations might be considered willful.

The key is prompt correction of problems by appropriate measures, and without lengthy periods of ineffective or stopgap procedures to cure irregularities.

There is a statutory authority (without having reasonable cause or a warrant) for examination of books and photocopying of records. Make sure all employees are well versed in appropriate records procedures and cautioned about making any false statement or representation with respect to required information, however innocent. In addition to license renewal difficulties, inaccurate recording can result in costly fines and other unpleasantness - and remember the requirement to keep such records for 20 years.

An interesting aside to the issue of record keeping - after the Branch Davidian tragedy in Waco, the Pensacola, Fla., dealer who was reported to have sold David Koresh some $50,000 worth of guns and ammo, bristled under what he claimed was harassment by BATF officials. The merchant insisted the arms sales were legal, and was able to prove so because proper records were kept of the transactions!
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Title Annotation:firearms dealers
Publication:Shooting Industry
Date:Jul 1, 1993
Words:609
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