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NFATCA Report: SAR V18N2

By John Brown

What is Happening to NFA Trust and Corporate Transfers?

If you are reading this article you will likely have been tracking the latest debacle from the White House that is, for whatever reason, being blamed by some on the NFATCA. In 2009 we did in fact submit a petition to ATF, after many meetings with our membership, to make recommendations on several fronts. Primarily was a submission to ATF to eliminate the painful process of having to have the CLEO sign off on Forms 4 and 1 – a process we had been working on with ATF for years. It is common knowledge that the primary reason why trust and corporate transfers had escalated so dramatically over the years was simply because many local law enforcement agencies would not sign off on a Form 4 or Form 1.

The only alternative to that process was to build a trust or start a corporation and handle the transfer with a legal entity. As we openly discussed many times, the only flaw in that process was the lack of any background check. When this process first started, not even a NICS check was required. Everyone in our community was worried that it would only take one single incident of the wrong person initiating a legal entity to acquire an NFA item when legally they would possibly be personally prohibited due to a criminal record in their past or for some other legitimate reason. We all knew that it would only take one person, that had no background check or no NICS check that was in fact a prohibited person, to be able to acquire or have easy access to a NFA weapon, to upset the entire apple cart.

This type of catastrophic event could easily take on a life all of its own in regulatory issues. Our objective was to propose a means by which this looming disaster could be avoided and work with ATF on a simple solution. Our suggestion was uncomplicated and straight forward:

First, eliminate the cause of this problem of the huge increase in trust and corporation entities by eliminating the need for the CLEO signature. That issue was suggested and worked towards ten years ago by the NFATCA.

Secondly, since ATF was going to act on this anyway, we recommended that regardless of the legal entity, a responsible person should represent the trust or corporation. This is an easy process that would allow any entity transfer to have a responsible person that could be designated to represent the entity and to submit fingerprints and photos. This process could closely parallel the process now in place with any FFL. Even a corporation must have a responsible person. A reasonable request.

From that point in our discussions with ATF nothing happened after the election five years ago; and ATF took on a noticeably different demeanor with the industry. No surprises here as we had been there before under another president and party years ago. But this time was different – things got quiet and often phones calls previously accepted were ignored. In protecting itself, ATF personnel sat quietly to see what direction the administration would actually take.

The first sign of real trouble occurred when the White House lost the first round of major gun legislation in congress. While everyone was celebrating, unfortunately, a lot of us sat down that afternoon and said, “Here it comes.” The current administration does not like to lose and as the president railed on his political loss in the Rose Garden, it was obvious that he intended to unleash his dogs in any way he could that included presidential dictates, using the vice president as a point man, cabinet policy hindrances, and blue state governors, senators and city mayors were all encouraged to act unilaterally. Additionally, the government regulatory agencies that are charged with protecting, promoting, regulating, supervising and enforcement now turned noticeably adversarial to our industry. Make no mistake: ALL of our firearm freedoms are under attack.

When you look at the statistics within ATF, one of the glaring factors is the tremendous rise in NFA transfers through corporate or trust entities. The backlog of transfers is in the tens of thousands and ATF is now advising a transfer time of up to 15 months. Those statistics alone made ATF and the White House target this obvious and conspicuous issue. Given the fact that there were minimal background checks resulting from ambiguous and confusing guidance on the 40,000 plus entity transfers to date at that time, it was apparent this was an easy target. The rest is history.

If you think for one moment that the NFATCA stands by the Notice of Proposed Rule Making by the White House, you are sadly mistaken and wrong. We fought to help manage this process in light of getting rid of the CLEO signature. Our necessary petition aligned itself with measures of forcing ATF to come back to the table and work with the industry. The White House saw an opportunity and took it.

Finally, as usual, a lot of backseat drivers and anonymous keyboard cowboys came out of the woodwork accusing the NFATCA as being traitors to the Class 3 community with one idiot actually threatening my life as well as one of our board members. These disruptive people, who hide behind their computers, are more than willing to throw anyone and any organizations under the bus if they don’t adhere to their extreme views exactly. Their sole purpose is to embarrass and poke the government and advocate the abolishment of the 1934 GCA and all subsequent laws and, while they are at it, eliminate all income tax. Nice idea but it ain’t ever gonna happen. The NFATCA has been around coming up to ten years in this industry, yet the naysayers would prefer to sit on the sidelines and criticize the plays and mock the coach, while absolutely making no contribution, constructive or otherwise, to the cause. Additionally, these same people think we work in secret with diabolical plans in cahoots with the government. Our actions are no secret and never have been. We have made public notice to our intentions via regularly appearing articles in Small Arms Review magazine, the SAR Show public meetings in Phoenix and York, the Knob Creek Shoot public meetings in Knob Creek twice a year, plus our presence via information booths at the SHOT Show in Las Vegas, and Orlando, the NRA Annual convention in whatever hosting city, and via our newsletter. There is no secret agenda and we have clearly communicated our intentions on the issues and we have received support from everyone at these meetings.

In these very trying times for our community, it is lunacy to think that these anonymous naysayers who criticize and mock on the internet are people acting in a positive manner. I know that what we are doing is good for the community – the dealers, the manufacturers, the importers, the exporters and the collectors – and we will continue all our efforts to be the voice to protect their interests. We have joined hands with those that are willing to work alongside us and in unity that include some of the biggest names in all areas of our industry. Why it is more important to stand outside and criticize than to join in and handle this administration as a united bloc is beyond me. Now is not the time to listen to deconstructionists. I recognize that we will not always agree on everything but I do know that in these very trying political times it must be a united effort against a larger enemy. I will forever stand by the mantra that we have called on for a long time: “United We Stand, Divided We Fall.” Sitting on the sidelines letting others do your bidding and hoping for change is past. It is time you joined our fight. Find out more at



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