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Writer's pictureMike Brandly, Auctioneer

Auctioneers with FFLs “acting as if” they aren’t? Indeed they can …


Auctioneers sell firearms at auction. Some are Federal Firearms Licensees (FFLs) who sell them at consignment auctions and the like, while others sell them at single-seller onsite auctions without an FFL. Regrettably, however, some auctioneers pay no attention to these laws …

Our topic today references in particular 18 U.S.C. § 923 (a) ATF Rul. 96-2 which says that even auctioneers who are FFLs can sell firearms at those single-seller onsite auctions without conducting any background checks on buyers. In other words, the FFL-auctioneer can act as if he’s not an FFL for this purpose.

Here is the particular section of 18 U.S.C. § 923 (a) ATF Rul. 96-2 which says that licensure as an FFL is immaterial in regard to selling firearms at “estate-type” auctions:

In the case of estate-type auctions, the auctioneer acts as an agent of the executor and assists the executor in finding buyers for the estate’s firearms. The firearms are possessed by the estate, and the sales of firearms are made by the estate. In these cases, the auctioneer does not meet the definition of “engaging in the business” as a dealer in firearms and would not require a license. An auctioneer engaged in estate-type auctions, whether licensed or not, may perform this function, including delivery of the firearms, away from the business premises.

We felt it important to note this section of federal law because some ATF agents were incorrectly telling auctioneers that if they were licensed as an FFL, they could only sell firearms under the rules of that license — for one, only distributing firearms from their licensed location unless specifically exempt under a qualified event. We wrote about those qualified events here: https://mikebrandlyauctioneer.wordpress.com/2017/08/14/the-auction-of-firearms-and-qualified-events/

Auctioneers are often advised to check with their local ATF office/agent in regard to questions about selling firearms at auction. While that would seem prudent, it is important to remember that Class 1 firearms at auction make up a virtually negligible portion of the ATF’s focus — as they have much more material issues on their radar (explosives, specialty ammunition, firearms smuggled in and out of the United States, semiautomatic and fully automatic weapons, etc.)

As a result, asking the “local ATF agent” is likely asking someone who knows little about 18 U.S.C. § 923 (a) ATF Rul. 96-2, and further, even if he or she takes the time to read this federal law, it’s probable there’s little knowledge of any common interpretations, or other ATF rulings (such as https://www.atf.gov/qa-category/auctioneers.)

We wrote our original analysis on firearms at auction in 2010: https://mikebrandlyauctioneer.wordpress.com/2010/01/17/a-guide-for-auctioneers-selling-guns/. As we pointed out in that treatise, an auctioneer without an FFL, or one with an FFL acting as if they don’t have an FFL, can only sell firearms within particular constraints:

  1. Don’t sell a short gun [hand gun] (i.e. pistol or revolver) to anyone under the age of 21.

  2. Don’t sell a long gun (i.e. rifle or shotgun) to anyone under the age of 18.

  3. Only sell guns, or facilitate such sales, to in-state buyers (unless the buyer is an FFL.)

  4. Only assist someone with the sale of their guns (and not repeatedly assist someone with the sale of their guns), without taking possession of them, with the seller maintaining possession of the guns until they are transferred to the buyers (a single-seller onsite auction.)

  5. Secure buyer information such as age, positive ID, address, phone, etc. and use the ATF form 4473 (or similar form) to have the purchaser answer questions about if they are a convicted felon, illegal alien, under indictment, etc. This lessens the risk of the auctioneer being held responsible for selling a gun to someone who cannot legally take possession.

  6. Be sure all guns are unloaded, and secured so they cannot be loaded by someone else.

  7. Have gun locks available to buyers.

  8. Be alert to “straw purchasers,” where a person is bidding for someone else, such as an illegal act of purchasing for an out-of-state buyer, or convicted felon, etc.

In summary: yes, per federal law an FFL can act as if he/she isn’t an FFL and sell firearms at auction at a single-seller onsite auction. If you’ve heard anything to the contrary, reference the supplier of that information to 18 U.S.C. § 923 (a) ATF Rul. 96-2 for clarification.

Finally, however (as of 2017) nine states (California, Colorado, Connecticut, Delaware, Nevada, New York, Oregon, Rhode Island, Washington) and DC require universal background checks at the point of sale for all transfers [there are some exceptions] of all classes of firearms, including purchases from unlicensed sellers; Maryland and Pennsylvania do the same for handgun purchases only.

Four states (Hawaii, Illinois, Massachusetts, and New Jersey) require any firearm purchaser, including a purchaser from an unlicensed seller, to obtain a permit issued after a background check, and four more states (Iowa, Michigan, Nebraska, and North Carolina) do the same only for handgun purchasers. Illinois also requires a background check whenever a firearm is sold at a gun show.

Mike Brandly, Auctioneer, CAI, AARE has been an auctioneer and certified appraiser for over 30 years. His company’s auctions are located at: Mike Brandly, Auctioneer, RES Auction Services and Goodwill Columbus Car Auction. He serves as Distinguished Faculty at Hondros College of Business, Executive Director of The Ohio Auction School, an Instructor at the National Auctioneers Association’s Designation Academy and Faculty at the Certified Auctioneers Institute held at Indiana University.

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