Best Practices in ATF Record Keeping

FFLs know the burden of the paperwork submission and record keeping requirements of the Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”).  Between the various forms, the information required, the submission timing requirements, and record keeping retention requirements, it’s enough to make one’s head spin!  In this article we’ll identify applicable paperwork for various types of FFLs and provide suggestions on storage and retention based on our experiences with hundreds of FFL clients.  We will not go into excruciating detail of every statutory or regulatory mandate and exception therefor.  This is a short primer aimed at pointing you in the right direction and is not intended as legal advice.  For detailed requirements, exceptions, and how to apply regulatory mandates to your business, you should contact a qualified compliance professional or attorney.

Before identifying the applicable forms, here are some general recommendations that while they may seem straightforward are all too often not followed by FFLs and leads to confusion, waste of time (and money!), inspection citation, and at worst, license revocation:

• One Department (or employee in smaller organizations) should be charged with maintenance of all regulated paperwork.
  • If other departments are charged with completing and submitting applicable regulated paperwork (e.g., sourcing department files import paperwork), the department/employee charged with maintenance of the regulated paperwork should immediately receive copies once completed, submitted, and received approved.
  • If, as in a smaller organization, one employee is charged with maintenance of regulated paperwork at least one backup should be specifically identified.
• All ATF regulated paperwork required to be maintained should be physically co-located to provide for quick access and easy audit/traceability.
• Detailed TRAINING is ABSOLUTELY NECESSARY for those who are completing or maintaining regulated paperwork. This is the leading cause for FFLs receiving citations; employees who complete regulated paperwork (e.g., A&D Book, Forms 4473) are improperly trained, or not trained at all.
• Periodic and independent internal audits should be conducted by your organization and identified errors should be corrected in a compliant manner.

Below we lay out the typical paperwork required to be maintained by FFLs, segregated by type of FFL (again, broad strokes not identifying every single nuance).  While ATF regulations do allow for the submission of certain records to ATF after a certain time period, we recommend that FFLs maintain at least a copy of all regulated paperwork permanently.  There are numerous reasons to maintain at least a copy of paperwork that you are authorized to turn in after turning in such records.  For example, assume a firearm is reported as Theft/Loss from your facility but someone fails to enter the disposition in your A&D Book.  After a period of 5 years you send the Theft/Loss form to ATF as is allowed under applicable regulation.  2 years later a trace is requested but as someone forgot to enter the disposition you cannot provide a response.  Moreover, ATF cannot find the Theft/Loss form you surrendered.  Now we have a scenario of an incomplete trace wherein the ATF is displeased with your inability to complete the trace.  Suffice it to say, it’s better when your regulators are happy with your performance.   With that said, FFLs should take note of the timeframes and recommendations below.

Orchid Advisors provides ATF and ITAR compliance services to manufacturing, distribution and retail FFLs. The firm offers FFL and Export licensing, deep record inspections, e4473 / NFA eForms, Electronic Bound Book software and delivers the largest online ATF and ITAR compliance training platform available.  Together with its partners, Orchid delivers the only integrated firearm compliance, technology and legal solution.