Lawyers and legal types of M4C: What law (if any) did my former manager break?

[Tx_Aggie]

Though that ends up being the problem. Not buying what he wanted, but buying for personal use from a private citizen under the belief the seller was transferring it to a licensed FFL. Then the employee not telling the FFL holder about it especially given the firearms never hit the books. Again, it doesn't scream illegal, but it doesn't scream entirely legal either.

I would go out on a limb and say the store would not want the BATFE to make a ruling on this.

The parts bolded below, if they happened this way, are almost certainly illegal.

The store originally had a rule that employees could buy anything from the store at cost, and this included used guns. So, whenever a customer sold the store a used gun, if Scott wanted it, he'd just take the gun for himself, pay the store back whatever was paid out to the customer, and never even put the gun into inventory. He justified this by pointing out that there was nothing in the company handbook that required us to put any inventory out for sale, so he was doing nothing wrong. But here's where it gets really murky: If it was a long gun, he would never even enter it into the store's logbook or do a 4473. He claimed that because he immediately paid the store back and there was no paperwork specifying that the gun was possessed by the company, he technically conducted a private transfer between himself and the customer, thus meaning that he didn't need to do any paperwork.

He was saying that because he elected not to do the required paperwork (logging the gun into the A&D) there was no way for ATF to prove that the gun was in inventory, and so no way he could get caught not doing a 4473. Not really the same as doing nothing wrong.

Customer wants to sell gun > gun store manager negotiates to buy the gun > manager pays customer with the shop's money (funds from the till or with a company check) > manager decides he wants the gun for himself > manager decides not to log it into the A&D > manager takes the gun home without doing a 4473/NICS check (because he intentionally left the gun out of inventory) > manager discretely pays the shop back (doesn't really matter if this last part happens on the same day or a different day)

With the store initially paying for the purchase, it's hard for me to see how anything after that in the above is kosher (or even legal).

[tb-av]

At the very least it sounds like fraud towards the customer. The customer clearly thinks they are selling the gun to a legit business and FFL dealer. Scott will say, no he bought the gun. Customer will say, then why does my receipt say DipDogs Gun shop?

[Joelski]

Gun shop owner failed to apply the "How can I lose my license today?" check to his rules/employee benefits. And yes, invariably some asshat will take advantage of the slightest bennie and get it shut down for everybody.

[BoringGuy45]

I would go out on a limb and say the store would not want the BATFE to make a ruling on this.

I think this just about sums it up. It sounds like the prevailing opinion here is that Scott was in the darker end of a gray area, and one that would likely not end well if the powers that made it a black and white issue.

[Averageman]

He put good and proper stewardship of the business and the possibility of legal ramifications second to personal gain.
Not the guy I want to leave my business and financial future in the hands of.

[OH58D]

He put good and proper stewardship of the business and the possibility of legal ramifications second to personal gain.
Not the guy I want to leave my business and financial future in the hands of.

Sums up the entire thread in a clear and concise statement.

[SomeOtherGuy]

The store originally had a rule that employees could buy anything from the store at cost, and this included used guns. So, whenever a customer sold the store a used gun, if Scott wanted it, he'd just take the gun for himself, pay the store back whatever was paid out to the customer, and never even put the gun into inventory. He justified this by pointing out that there was nothing in the company handbook that required us to put any inventory out for sale, so he was doing nothing wrong. But here's where it gets really murky: If it was a long gun, he would never even enter it into the store's logbook or do a 4473. He claimed that because he immediately paid the store back and there was no paperwork specifying that the gun was possessed by the company, he technically conducted a private transfer between himself and the customer, thus meaning that he didn't need to do any paperwork.

"Scott" was not misrepresenting the buyer, he was intentionally failing to do legally required paperwork. The sale is from customer to FFL-holding store, not to Scott. The customer didn't walk in to find private individual Scott on his break time, they came to the store. Scott had both actual and apparent authority on behalf of store-licensee while buying a gun. That requires it be logged into the licensee's book. Store owns the gun even if only for a few minutes. Scott then sold store's gun to himself without doing mandatory 4473 and mandatory entry in licensee's bound book.

Major, deliberate FFL paperwork violations. Don't feel like looking up ATF regs but probably a criminal violation given the intent.

Customer is likely not harmed as they got their money, unless they somehow are exposed to liability if Scott resold the gun to someone who used it in a crime. Possible in some states, not likely or common in most.

This is my view of what the law is under the 1968 GCA, later legislation, and ATF regs, not what you or I might like it to be.

[Tx_Aggie]

"Scott" was not misrepresenting the buyer, he was intentionally failing to do legally required paperwork. The sale is from customer to FFL-holding store, not to Scott. The customer didn't walk in to find private individual Scott on his break time, they came to the store. Scott had both actual and apparent authority on behalf of store-licensee while buying a gun. That requires it be logged into the licensee's book. Store owns the gun even if only for a few minutes. Scott then sold store's gun to himself without doing mandatory 4473 and mandatory entry in licensee's bound book.

Major, deliberate FFL paperwork violations. Don't feel like looking up ATF regs but probably a criminal violation given the intent.

Customer is likely not harmed as they got their money, unless they somehow are exposed to liability if Scott resold the gun to someone who used it in a crime. Possible in some states, not likely or common in most.

This is my view of what the law is under the 1968 GCA, later legislation, and ATF regs, not what you or I might like it to be.

Pretty much.

I'm not an attorney, so my opinion is worth pretty much zip, but I think the most obvious parts of the GCA are:

18 U.S. Code § 922.Unlawful acts (m)

It shall be unlawful for any licensed importer, licensed manufacturer, licensed dealer, or licensed collector knowingly to make any false entry in, to fail to make appropriate entry in, or to fail to properly maintain, any record which he is required to keep pursuant to section 923 of this chapter or regulations promulgated thereunder.

And probably also (t), the section that requires a licensee to conduct a NICS check before transferring a firearm to a non-licensee, and to record the transaction.

Possibly:

18 U.S. Code § 922.Unlawful acts (a) (6)

for any person in connection with the acquisition or attempted acquisition of any firearm or ammunition from a licensed importer, licensed manufacturer, licensed dealer, or licensed collector, knowingly to make any false or fictitious oral or written statement or to furnish or exhibit any false, fictitious, or misrepresented identification, intended or likely to deceive such importer, manufacturer, dealer, or collector with respect to any fact material to the lawfulness of the sale or other disposition of such firearm or ammunition under the provisions of this chapter;

Once he knew he'd purchased stolen firearms and refused to return them, he was in violation of:

18 U.S. Code § 922.Unlawful acts (j)

It shall be unlawful for any person to receive, possess, conceal, store, barter, sell, or dispose of any stolen firearm or stolen ammunition, or pledge or accept as security for a loan any stolen firearm or stolen ammunition, which is moving as, which is a part of, which constitutes, or which has been shipped or transported in, interstate or foreign commerce, either before or after it was stolen, knowing or having reasonable cause to believe that the firearm or ammunition was stolen.

For penalties:

18 U.S. Code § 924.Penalties

(a)

(1)Except as otherwise provided in this subsection, subsection (b), (c), (f), or (p) of this section, or in section 929, whoever—

(A)knowingly makes any false statement or representation with respect to the information required by this chapter to be kept in the records of a person licensed under this chapter or in applying for any license or exemption or relief from disability under the provisions of this chapter;
(D)willfully violates any other provision of this chapter,
shall be fined under this title, imprisoned not more than five years, or both.

(2)Whoever knowingly violates subsection (a)(6), (d), (g), (h), (i), (j), or (o) of section 922 shall be fined as provided in this title, imprisoned not more than 10 years, or both.

(3)Any licensed dealer, licensed importer, licensed manufacturer, or licensed collector who knowingly—

(A)makes any false statement or representation with respect to the information required by the provisions of this chapter to be kept in the records of a person licensed under this chapter, or
(B)violates subsection (m) of section 922,
shall be fined under this title, imprisoned not more than one year, or both

.

(5)Whoever knowingly violates subsection (s) or (t) of section 922 shall be fined under this title, imprisoned for not more than 1 year, or both.

He knowingly violated 922(j), and showed a pattern of willfully violating 922(m) and 922(t), and probably 922(a)(6). As the authorized agent and representative of the licensee who employed him, I'd think he could be in jeopardy of any of the above penalties.