Section
Four: Illegal Trafficking at Gun ShowsThe factors
described in the preceding section have combined to create a volatile mix, making
gun shows a favored venue for unscrupulous sellers and criminal purchasers. Illegal
transactions at gun shows usually occur in one of three ways: 1) straw purchases;
2) out-of-state sales; and 3) sales from "personal" collections.
Straw Purchases: "I Would Walk Out With the Guns in My Pocket"
Straw
purchases occur when a person who is not in a restricted category (the "straw
man") purchases a weapon for someone who is prohibited by federal, state, or local
law from purchasing or possessing a firearm. Straw men are used by criminals,
minors, or others in proscribed categories to transact sales with both Federal
Firearms License holders and unlicensed hobbyists. In some cases the seller does
not know that the weapon is being passed on to an illegal buyer, but in others
the seller is aware of the straw sale. At a 1993 hearing on federal firearms licensing
before the crime subcommittee of the House Judiciary Committee, convicted criminal
Edward Daily III testified that he regularly used straw purchasers to buy handguns
at gun shows in Virginia. The 22-year-old Daily traded the guns for narcotics
in New York City. According to Daily: I
would have someone with a legal Virginia license and another form of ID. I would
hand them the money and then tell them [the straw purchaser] to purchase this
firearm, and then they would fill out the paperwork, and, basically, a lot of
them would hand the guns to me after I purchased them, and I would walk out with
the guns myself and put them in my car. At
the hearing, then-House Crime Subcommittee Chair Charles Schumer (D-NY), who has
played a leading role in documenting gun show abuses, questioned Daily:
Schumer: It was obvious that you were violating the law?
Daily: Yes. Schumer:
And these people were dealers—were gun dealers? Daily:
Yes. At each gun show, there were about, maybe 250 tables with different gun dealers,
and we would visit maybe 20, 30 tables. Some of them saw me every weekend, and
they knew me....`Hi. How's it going....Are you picking up any guns today?' Schumer:
And you always bought from the same few dealers? Daily:
Yes sir, usually the same dealers because they sold the type of weapons that we
wanted. Schumer: And this was always at gun
shows? Daily: Always at gun shows.23
The ease with which Daily purchased
firearms using straw men is not uncommon. In November 1993, Robert Dart, then-head
of the Chicago Police Department's gang crimes section, told the Chicago Sun-Times
that despite Chicago's stringent gun laws the police department seizes in excess
of 20,000 illegal guns a year. According to Dart, illegal purchases at gun shows
have replaced theft as the criminal element's preferred method of obtaining firearms.
Dart stated, "Gangs buy guns through straw purchases. If I want a gun and am a
convicted felon, I take a friend with a state [Firearm Owner's Identification]
card outside the city and he buys it. Back home, he sells it to me and risks only
a minor violation." The article continued, "Semiautomatic weapons, including the
gang-favored TEC-9 are bought at gun shows set up at unlicensed facilities at
state fairs or county fairs.... Merchants rent property for a day, advertise a
gun show and sell them out. Illinois has more than 100 such shows."
Out-of-State Dealers—Wheelchair Luis, Freckle Face George, Lightbulb, and Friends
Although federal law allows Federal Firearms License
holders to sell at gun shows within their own state, FFL holders—and hobbyists—are
not permitted to make out-of-state sales.24 Evidence
suggests that many dealers do not abide by the requirement that they sell only
in their own state. This non-compliance by some dealers causes distress not only
among law enforcement, but complying dealers. The National Association of Stocking
Gun Dealers' Bill Bridgewater asserts that gun show violations occur all the time:
If you can't see them, you're blind.
When you go to a [North Carolina] gun show and you see every state licensee around
you for 250 to 300 miles and you chat with various folk standing behind their
table of handguns...[from Ohio, Florida, Virginia], does that give you a clue?
There are a lot of [illegal sales being committed] under the color of an FFL traveling
state to state every weekend and attending firearms shows and selling firearms
unlawfully in those states. The principal reason they do is that at every gun
show in this nation no one pays any attention to the law. At
a seminar presented at the 1992 S.H.O.T.25 (Shooting, Hunting and Outdoor
Trade) Show, "BATF: Issues and Answers," audience members complained to the ATF
panel about out-of-state dealers, some using a straw licensee. Said one stocking
FFL, "My main concern is out-of-state dealers coming and going through another
[in-state] dealer to transfer. That's the only time this person ever sees this
guy who's a resident of our state. I think it's a serious problem, that doesn't
seem to be addressed—at least in our state—by ATF." In
response, then-ATF Firearms and Explosives Division Chief Robert Daugherty said,
"If we find the individual selling at an out-of-state gun show, we wouldn't go
after a license revocation right out of the starting block, but if that person
were warned and continued to do that we have every right legally to revoke that
individual's license. If he's not an FFL, it's a different story." Daugherty noted
that for most prosecuting attorneys, illegal firearms sales at gun shows were
just not a high priority. Yet to the stocking gun dealers they were. Said one:
I've contacted my state regarding these
laws, and they've referred me to ATF. I've spoken with ATF regarding these people
coming in from out of state and...sales going on without [federal] 4473 forms
to people that shouldn't even have a handgun. When these [firearm] crimes occur
within our city, the dealers that have the stores are the people being blamed
for selling these weapons. I can't get any enforcement. I've spoken with our local
ATF about this problem. They say, 'contact me before the next show.' I've done
so. For some reason or another I can't get them to come. Are you saying that ATF
cannot keep this person from say, Missouri out of our state, that goes to California
the next week, and Florida the next week? Sergeant
Bernard Shaw of the Maryland State Police Licensing Division, a witness at the
1993 House Judiciary crime subcommittee hearing cited earlier, decried out-of-state
dealers as a serious problem: "Federal firearms licensed dealers from out of State
come into the State of Maryland at gun shows. They sell whatever they have, no
questions asked." Sergeant Shaw offered as an example the Pikesville Gun Show,
where, he said, there were "licensed dealers from New Jersey, New Hampshire, Vermont,
Virginia, North Carolina, that are coming into...[Maryland]...selling firearms
and, really, with no intent of obeying our laws." Shaw's
prepared statement described the motivation of such dealers:
The illegal sale of firearms may be as profitable as the illegal
drug trade. Persons who may be prohibited by Federal or State laws from purchasing
a firearm will pay more for an unregistered sale. It is an attractive business
for those who are willing to make short trips to any state that conducts weekly
gun shows, such as Maryland, Virginia, Carolinas, Georgia, Florida, Oklahoma,
Texas, and many others. Sales of firearms at these shows circumvent federal and
state laws. Some of the persons who attend these
shows are federal firearms licensees with business addresses at their homes, who
work out of their vehicle or work on consignment for other federal firearms licensees.
These persons are known as `Hobby dealers' or `Gun show dealers.' They sell and
transfer firearms at gun shows with little or no restriction due to the lack of
enforcement personnel to deal with the number of gun shows in the United States.
These persons do not record the sales of these firearms in a permanent record
and any possibility of tracing this particular firearm is lost. [The full text
of Sergeant Shaw's prepared statement is reprinted in Appendix Three] Other
state law enforcement authorities have experienced similar problems with out-of-state
dealers. For example, Richard Yarmy illegally sold a wide variety of weapons to
New York City criminals who went by the names Wheelchair Luis, Freckle Face George,
and Lightbulb. According to the New York district attorney, Yarmy was indicted
for using his FFL—which he had possessed for more than 10 years—to supply guns
illegally to Manhattan "drug dealers and other street criminals." Upon his arrest,
New York officials called Yarmy "one of the highest volume dealers" at gun shows
along the eastern seaboard. Weapons seized during the course of the investigation
included assault pistols, Street Sweeper shotguns, and fully automatic firearms.
Yarmy allegedly used his Boones Mill, Virginia residence to handle mail and telephone
orders and to store firearms between gun shows, although the residence was not
open to the public as required under federal law as a condition of licensure.
The Violence Policy Center's survey reveals that
such violations are not unique: We have
revoked some licenses for people dealing at out-of-state shows. We got a lot of
complaints at the beginning from legitimate dealers. We had one guy in 1990 that
had licenses in eight states. He would set up limited partnerships with a dealer
in that state, so he was attempting to do it legally, but the problem was he wasn't
doing the transfer paperwork right. He would bring guns to sell in Ohio without
transferring all of them to Ohio. He only transferred the guns he sold. And then
some others got so greedy when they were told they couldn't go out of state anymore
they still did anyway. Dick Van Loan, Area Supervisor of Regulatory Enforcement,
ATF Field Office, Detroit, MI. Another problem
is out-of-state dealers....They're not as likely to be familiar with state law.
The first show we ever went to there was no federal waiting period yet. An Ohio
dealer sold a gun without honoring the Pennsylvania waiting period. We get more
complaints from local dealers about out-of-state dealers. They don't worry about
if someone is not a dealer and sold a gun. They worry more about the out-of-state
dealer who sold five or six guns. The first time we ever went to a gun show in
the first five minutes we were there an out-of-state [dealer] made a deal right
in front of me. Howard Wolfe, Area Supervisor, ATF North Atlantic District
Office, Pittsburgh, PA. Despite
the clear problems associated with Federal Firearms License holders selling at
out-of-state gun shows, ATF may be preparing to shoot itself in the foot on this
issue. In recent letters to Senator Fred Thompson (R-TN) and Representative James
Oberstar (D-MN) obtained by the Violence Policy Center through the Freedom of
Information Act, ATF has agreed to support, on condition of the inclusion of certain
amendments, a measure (S. 1536 in the Senate and H.R. 659 in the House) allowing
dealers to conduct business at out-of-state gun shows.26 Although some
might argue that legalizing sales at out-of-state shows would only decriminalize
activity already occurring and improve recordkeeping of such sales, the risks
clearly outweigh any potential benefit.27 Such a change would undoubtedly
further increase the number of gun shows as dealers would be freed up to attend
out-of-state shows. On the eastern seaboard, for example, dealers could easily
attend shows in multiple states on a regular basis. Since dealers are not required
to keep records of whether a firearm is actually sold at a gun show or at their
licensed place of business, law enforcement would have no way to pinpoint in which
state a particular gun was transferred.
"Personal
Collections"
In defining the threshold of activity
one must cross to be categorized as a "dealer," McClure-Volkmer specifically excludes
a person who makes "exchanges or purchases of firearms for the enhancement of
a personal collection...or who sells all or part of his personal collection of
firearms."28 Therefore, private individuals selling firearms at gun
shows from their "personal collections" are not required to obtain a Federal Firearms
License, and as noted earlier, need not comply with the recordkeeping and reporting
requirements that apply to license holders. In addition, unscrupulous dealers
can thwart gun control laws by transferring weapons to relatives' or friends'
"personal collections," to be resold with no record of the ultimate purchaser.29
30 Kahau Morrison, resident agent in charge
of the ATF Field Office in Wilmington, Delaware, said that while Delaware has
made inroads reducing illegal sales by out-of-state Federal Firearms License holders,
there are no restrictions or recordkeeping requirements on sales by non-licensed
individuals. Such persons, she noted, can end up selling hundreds of guns out
of what they call their "personal collections." Morrison added:
At the present time in Delaware there is no restriction on personal
sales. We don't always know who is there [at a gun show] as a commercial entity
and who is there [at a gun show] to sell personal weapons. It's no problem to
sell your personal weapons, but if someone is constantly there and selling two
to three hundred guns out of their `personal collection' they are now violating
federal and state laws. There are many people who are not permitted to be there
[at gun shows] that go. Agent Larry
Ford, group supervisor of the ATF Detroit Firearms Trafficking Group, concurs
that "personal collections" contribute to illegal gun trafficking:
The problem would be the regular citizen's being able to go...[to
a gun show]..and put their own firearm on display without a license or any paperwork
being done. Based on the type of cases that we put together in our group, some
[criminals] indicate that they bought their firearms at local gun shows and flea
markets. 
- See Appendix Two for a complete transcript
of the exchange between Representative Schumer and Daily.
- ATF
has enumerated several problems that would occur if FFL holders were allowed to
engage in business at out-of-state gun shows. For example, there is concern that
licensees would fail to record sales information in a timely fashion, thus hindering
gun traces. Furthermore, dealers who spend a good deal of time traveling from
show to show might be unavailable to respond promptly to tracing requests or to
make records and inventory available for inspection.
- The
S.H.O.T. Show is the annual trade show for the firearms industry and is sponsored
by the National Shooting Sports Foundation, which is located in Newtown, CT.
- The bill is supported by the Collectors and
Arms Dealers Association (CADA), which represents more than 50,000 gun dealers
and collectors.
- Such an argument was used
by some to justify the dramatic increase in the number of illegitimate Federal
Firearms License holders under the Reagan and Bush administrations. This increase
did not, however, aid ATF regulation and enforcement, but only created an unmanageable
universe of FFL holders that effectively hid unscrupulous license holders who
were using their FFLs for high-volume criminal gun trafficking.
- See
18 U.S.C. § 921 (a)(11)(A) and (21)(C).
- In
some cases, license holders have illegally "sold" firearms to friends and relatives
by having them fill out sales forms for weapons they never received. The dealers
then sell the actual firearms to individuals who might not otherwise pass a criminal
background check or who are otherwise ineligible to possess firearms. The 1993
St. Petersburg Times series reported that Stephen Lemons "was a firearms
dealer who had something for everyone. He kept two sets of guns at his flea market
booth—one for customers who could buy guns legally, and one for people who had
a problem with the law." Lemons confided to an undercover officer that "any gun
with a yellow tag could be purchased secretly, because phony buyers had already
signed as the owners." Lemons had sales forms that indicated he had sold dozens
of guns to just two people—people he had paid to sign the forms for future sales.
Lemons was finally arrested by undercover detectives when he agreed to sell a
machine gun and silencer without going through the proper licensing criteria.
- Under certain circumstances dealers may transfer
firearms out of their own "personal collections" without recording the transaction.
Prior to the passage of McClure-Volkmer, licensed dealers were required to record
the sale or other disposition of firearms held in both their business inventories
and their personal collections. See e.g. National Rifle Association v. Brady,
914 F.2d 475, 480 (4th Cir. 1990), citing United States v. Endicott, 803
F.2d 506, 510-11 (9th Cir. 1986).
Go to Section Five: Where the Famous and
the Infamous Shop Return to Table
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