H.R. 1093

H.R. 1093 contains a number of relatively minor pro-gun provisions which we have championed for many years, but it’s offset by one really bad thing.

THE BAD

The bill contains, for the first time, “civil penalties” for federal firearms licensees (FFL’s).

The bill’s supporters tout the introduction of “civil penalties” as a good thing -- arguing that this allows regulators to take action against errant FFL‘s short of license revocation.

The problem is that -- in virtually all of the most aggressive regulatory agencies in the federal government -- “civil penalties” are the central engine whereby the agency has expanded its jurisdiction.

Thus, for instance, the Securities & Exchange Commission (SEC) will bring an action against Merrill Lynch -- arguing a broad new expansion of its regulatory authority and demanding hundreds of millions of dollars of “civil penalties” for violations which need be proven only by a “preponderance of the evidence.”

The SEC offers to “settle” the suit for much less, thereby creating a legal precedent which it can use to go against other businesses.

True, the “civil penalties” in H.R. 1093 would be considerably less -- for now.  But we have seen how difficult it is to argue against “changing the numbers” once penalties are established.  And, for small FFL’s, $5,000 may be as onerous as $500,000,000 is for Merrill Lynch.

Hence, GOA has felt that section 101 is so problematic that it has, in the past, opposed passage of what is otherwise a good bill.

SPECIFICS

Section 101:  Current subsections 18 U.S.C. 923(e) and (f) allow BATF to revoke FFL’s, after notification and the opportunity for a hearing.  Section 101 would create a bifurcated structure:

* “non-serious” violations could trigger civil penalties of up to $500 ($2,500 per inspection and $5,000 per year) and a suspension of not more than 30 days; and

* “serious” violations could trigger $1,500 civil penalties ($7,500 per inspection and $15,000 per year), up to 90 days suspension, or revocation.

“Serious” violations would consist of, inter alia, actions which could result in the acquisition of a firearm by a prohibited person or interfere with a criminal investigation.  There would be a five-year statute of limitations, and there would be procedures for contesting penalties (before an administrative law judge in the case of minor penalties and before a court in the case of revocation).  These procedures would be relatively pro-defendant –- with a bar to bringing a civil charge after an unsuccessful attempt at a criminal prosecution.

Section 102:  This section would allow an FFL applicant to supplement his application, in the case of problems, before final denial.

Section 103:  One of the big battles in McClure-Volkmer was over “scienter” (state-of-mind) requirements.  In particular, there has been a tendencv to diminish what is required for an individual to act “knowingly” or “willfully.”  This section would define “willfully” to mean “intentionally,” which is about the most culpable state-of-mind requirement in existence.

Section 104:  This section would require BATF to establish guidelines for conducting investigations.

Section 105:  This section would give an FFL with a revoked license 60 days (with the possibility of an extension) to liquidate his inventory.

Section 106:  This section would allow more flexibility in permitting an FFL with a revoked license to transfer his business to another FFL without automatically assuming that the violation giving rise to the revocation continues –- and with an opportunity for the acquiring FFL to cure any defects.

Section 107:  This section would decriminalize a non-material (i.e., minor and irrelevant) “false entry” in FFL records.

Sections 201 through 207 would:

* Make minor non-controversial corrective changes to federal gun law;

* Allow testing and security corporations to test machine guns without getting a license;

* Eliminate the provision of 18 U.S.C. 922(x) which would allow a parent to be prosecuted because his son possessed a handgun without a written permission slip -- even if the parent were physically present; and

* Expand the ability to import gun parts.

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