New Study–More Gun Dealers Than Gas Stations–Documents Criminal Abuse of Federal Gun Dealer Licenses and Regulatory Failures of Federal Bureau of Alcohol, Tobacco, and Firearms (ATF)

For Release: Friday, December 11, 1992

New Study–More Gun Dealers Than Gas Stations–Documents Criminal Abuse of Federal Gun Dealer Licenses and Regulatory Failures of Federal Bureau of Alcohol, Tobacco, and Firearms (ATF)

Hundreds of thousands of Americans – including an untold number of criminals – illegitimately possess Federal Firearms Licenses (FFLs) issued by the federal Bureau of Alcohol, Tobacco, and Firearms (ATF) according to a new 138-page study, More Gun Dealers Than Gas Stations, released today by the Violence Policy Center. The study was released at an 11:30 A.M. press conference on Friday, December 11 held at the offices of the Violence Policy Center, located at 1300 N Street, NW in Washington, D.C.

According to Josh Sugarmann, VPC executive director and one of the authors of the study, “The FFL is a public safety scandal created by the very agency charged with enforcing federal firearms laws. By giving a federal gun-dealing license to virtually anyone who can come up with $30 and isn’t a convicted felon, ATF has put criminals in the business of selling guns.”

From 1975 to 1992, the number of Type I FFLs (the basic federal license required to sell guns in America) jumped more than 67 percent�from 146,429 to 245,000. FFL holders can order guns wholesale through the mail in unlimited quantities and are exempt from retail sales laws such as waiting periods and background checks. Type I dealers fall into two categories: those operating storefront businesses, or “stocking” dealers; and “kitchen-table” dealers who operate out of their homes. ATF estimates that only 20 percent (49,000) of Type I FFLs are storefront operations. The remainder are kitchen-table dealers who typically operate in violation of state and local business and licensing laws and unbeknownst to local law enforcement personnel. [State and local listings of FFL holders are available from the Violence Policy Center.]

The result is a “bloated, unmanageable universe of illegitimate FFL holders” that is virtually impossible to regulate and prone to criminal abuse. For example:

  • During a six-month period in 1990, Gustavo Salazar, a Type I FFL kitchen-table dealer in Los Angeles purchased more than 1,500 guns and sold them to gang members and other individuals. An ATF check on 1,165 handguns sold by Salazar revealed that only four had been registered under California law.
  • From February to June 1990 Detroit kitchen-table dealer McClinton Thomas ordered hundreds of handguns. All of the guns were sold off the books, including 90 guns to a “big-time dope dealer.”

In a first-of-its-kind analysis of criminal gun traces in Detroit, the study found that:

  • In a ranking of dealers by number of crime guns traced back to them, kitchen-table dealers ranked first, second, sixth, seventh, eighth, and ninth.
  • One third of all dealers who had five or more crime guns traced back to them were kitchen-table dealers.
  • The average number of guns traced per kitchen-table dealer was nearly one and a half times that of stocking gun dealers.

The study notes that the Detroit figures provide “disturbing evidence that kitchen-table dealers contribute significantly to criminal gun flow, perhaps at a rate far higher than stocking gun dealers. What is most disturbing is that…[these figures]…are the first of their kind.”

The study shows that abuses conducted by FFLs fall into five categories:

  • Straw-Man Purchases where a person who is not in a restricted category (the straw man) purchases a weapon for someone who is prohibited by law from purchasing or possessing a firearm.
  • Unrecorded Sales where the FFL sells weapons to a purchaser without logging the guns into his firearms distribution book or confirming the identity of the purchaser.
  • Buy and Dump unrecorded sales where large quantities of weapons are purchased and distributed in a short period of time.
  • License Falsification where the federal license itself is altered or falsified to permit illegal transactions.
  • Gun Shows federal laws regarding gun shows are often ignored, with violations usually occurring three ways: out-of-state dealers sell through a local FFL; guns are sold by out-of-state licensees at the show even though it is not their licensed place of business; and, guns are simply sold off the books.

Type I FFLs are almost always granted and renewed by ATF, and almost never revoked. Ninety percent of all licensee applicants are not visited or interviewed by ATF before a license is granted. On average, each year less than three percent of all current license holders (Types I-11) are inspected. In 1990 ATF revoked only three of the 235, 684 Type I FFLs held by Americans – or one thousandth of one percent. The study notes, “Considering the low number of annual inspections and ATF’s attitude toward low-volume dealers, a kitchen-table dealer can expect to hold his FFL for a lifetime without meeting an ATF inspector.”

Even if ATF expressed greater enthusiasm for its regulatory responsibilities, its compliance powers are hindered by two factors: the sheer size of the FFL universe; and 1986’s National Rifle Association-backed McClure-Volkmer amendments to the Gun Control Act of 1968, which placed several roadblocks in ATF’s way. The study reveals, however, that although McClure-Volkmer is often cited as the primary reason for ATF’s regulatory laxity, under the law the agency is required to deny FFLs to those who do not meet its relatively high “engaged in the business” threshold. If ATF enforced this standard, the study estimates that the number of FFL holders would shrink to a far more easily regulated 49,000 licensees. The study traces ATF’s present lack of regulatory enthusiasm to its near-dismantling in the early 1980s. This has resulted in “a bureaucratic culture that strives to avoid controversy and in its regulatory activities almost always adopts the most pro-industry interpretation possible.”


The Violence Policy Center is a national educational organization working to stop gun death and injury. Follow the VPC on TwitterFacebook, and YouTube.

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