Straw Purchases

Two words that should strike fear into every FFL. Maybe it brings up memories of that infamous video from a few years ago of two ATF agents harassing an innocent Delaware man by showing up on his front porch in full body armor without a warrant, demanding to see his guns, while a Delaware State Trooper stands guard a few feet away. If that video is not familiar to you, search YouTube.

So, what is a straw purchase? Well, here are the origins of this two-word phrase:

Origin of the Term:

• The “straw” person is just a stand-in — like a hollow figure made of straw — pretending to be the true buyer.
• A “straw man” is a figurehead or front person used to conceal the real party in interest.
• In firearms law, a “straw purchase” refers to a situation where someone who can legally buy a gun does so on behalf of someone who cannot (e.g., a convicted felon, minor, or someone otherwise prohibited by law).

Straw purchases are a common way for felons, gang members, and criminals to get guns. However, there are exceptions to what constitutes a straw purchase. You can legally buy a gun with the intent to gift it to a non-prohibited person. That isn’t a straw purchase. A straw purchase would involve either a prohibited person or an exchange of money.

The ATF defines a straw purchase as “Buying a gun for someone who is prohibited by law from possessing one or for someone who does not want his or her name associated with the transaction is a ‘straw purchase.’”

So, here are two conditions that constitute a straw purchase:

• Buying a gun on behalf of someone who is prohibited from possessing a gun.
• Buying a gun on behalf of someone who does not want to complete a 4473 form and doesn’t want the government to know they bought a gun.

That means not only is buying a gun for a prohibited person a straw purchase, but so is buying one for that friend or family member who thinks a 4473 is “gun registration” and “doesn’t want the government to know that they bought a gun.”

However, the ATF has a single exemption that allows buying a gun for another person, and that is when it is a bona fide, actual gift. If the gun is purchased with the buyer’s own money and given to another person who is not a prohibited person without an exchange of money, goods, services, or other tangible items or things of value, then it is a real gift.

Some states require background checks on private party transactions, so in those states, this is moot, as it requires the final recipient of the gun to do the background check.

The Dangers of Straw Purchases

The ATF and the firearms industry have a vested interest in minimizing straw purchases. They are one of the most common ways for prohibited persons to acquire guns and are very difficult to track and prevent. 

Guns acquired through straw purchases have shown up in the hands of Mexican drug cartels, gangs across the nation, and with various prohibited persons committing violent crimes. For that reason, reducing straw purchases is one of the most important things an FFL holder can do.

But what can you do, since it’s pretty hard to know if somebody is lying on a 4473?

How to Limit and Prevent Straw Purchases

It is a sad fact that it’s pretty much impossible to prevent ALL straw purchases. After all, if the buyer claims they are the actual buyer and the ATF approves the background check, the system has worked as it should. Once the buyer leaves your place of business and hands the firearm over to his/her convicted uncle in the parking lot or the buyer’s home, there is nothing you can do about it. But here is the kicker. If the gun is subsequently used in a crime, the trace request will go back to the owner of record, which is the person who completed the 4473.

But within your business establishment, where you control the scenario, there are tricks you can use to spot potential straw purchases. Remember, as an FFL holder, you are not obligated to conduct any transaction you don’t feel comfortable with. Some common red flags for straw purchases include:

• One person comes in with another and tells them what gun to buy and then hands them the money for the transaction. Or simply tells them what gun to buy. As cliché as it is, this is often a man using an intimate partner to purchase a gun for his use. This is most easily resolved by telling them they will both need to complete a 4473, and both will have background checks done. If one refuses, then you know, and it’s best just to tell them to leave.
• Multiple purchases of the same or similar gun. We all want to hit the lottery and buy out a store’s inventory. But it is pretty unusual to buy multiples of the same or nearly the same gun, though. Treat such transactions with great care, especially if you are near an area of high crime activity or the southern border.
• Buying guns with large wads of cash. There was a notable incident at the Morgantown Gun Show (near Reading, PA) on February 27–28, 2021, involving four Philadelphia-area men who used large amounts of cash to purchase ghost gun kits (often called “80% lowers”) with the apparent intent to assemble and distribute them illegally in Philadelphia. One man (19) bought multiple ghost‑gun kits with cash during the Feb 27 show. On Feb 28, three more men bought four more kits with cash. Surveillance followed them back to a “build house” in Philadelphia, where a raid revealed fully assembled ghost guns, parts, $8,600 in cash, ammo, magazines, suspected fentanyl, and assembly tools.
• Multiple individual purchases over a few short days, as in the example above. It should raise an alarm with people buying multiples of similar guns. Odds are a gang isn’t arming up with .22s, but three or four pump-action shotguns to the same person in a short time is suspicious.
• Gun raffles where the ticket winner is not the transferee. I frequently run gun raffles for local non-profits. If you run or want to run raffles, get the list of ticket winners, and ONLY conduct background checks on the winners. I had a situation where a wife won a gun, but both she and her husband showed up at my door. She replied that “she just put her name on the ticket, but the ticket was really for her husband.” So, I made them both complete a 4473 and ran background checks on both of them. Then, when I had to settle up the background check query with the PA State Police, I simply told them one was a “no sale” because I wanted to ensure there was no straw purchase, a rationale they always accept. Also, broadcast before the drawing that you will ONLY conduct background checks on the actual winners.

You are not obligated to continue the transaction. I would rather lose a sale than lose my license. If there are obvious red flags, it’s better to risk the sale than risk the gun going to a prohibited person. And because it is very difficult to prove a straw purchase is going down, in all likelihood, you are not going to involve law enforcement. Then it becomes a case of what he said/they said with no real proof. Simply decline the transaction. Do you really need the sales revenue that badly?

Dealing With Gifts

Many people buying a gun as a gift will be unsure of the process. They may know if it is possible, or they may not even know if it is, and will ask. They want to make sure everything is on the up-and-up, so they are usually not straw purchasers. And of course, those who already know how the process works won’t say a thing. Still, if you think somebody is buying a gun as a gift, there are steps you can take to ensure the gun winds up in legal hands.

• Suggest a gift card or certificate instead, and for the recipient of the gift to come down and select the gun they want instead. Many people will see this as reasonable, and you have the chance to sell ammo and accessories to the end user that the gift giver might not have chosen to buy.
• You can also offer to put the gun on “hold” with a full or partial payment pending the person receiving the gift coming in and doing the paperwork themselves.

In either case, you might increase the likelihood of the actual recipient coming in to do the background check. Of course, these approaches must be used with caution. Many people want the physical item to gift, and if they are giving it to a spouse or close friend may take offense at the idea of having them come down to the store on a legitimate, and legal gift. But if it comes down to license revocation or a customer’s feelings, the choice should be clear.

Conclusion

In this world of fraud and deceit, straw purchases are something we are just going to have to live with. They can be easy to spot or extremely difficult to identify.

But keep this in mind. Every time guns are acquired through straw purchases, gun control zealots ramp up their desire for additional gun control schemes. Don’t feed their narrative.

As far as FFLAssist is concerned, this is one scenario where FFLAssist will not provide much help, because actual or attempted straw purchases require dealers to observe and be aware of what is happening with their gun buyers. I cannot program “Spidey senses” into this application.