ATF Extending CLEO Sign Off to Trusts and Corporations

[Bartholomew Roberts]

The proposal has just been published in the Federal Register. The date for comments begins Monday. Give it a look then and you should see it at the above link.

[TXAZ]

Would it be reasonable for the 'TFL Brain Trust" to contribute Key points here that others may consider for their response?

It's important for salient, concise comments be posted within the time limit (90 days from I believe Monday?).

I deal with another federal agency daily and and they are required to 'seriously consider all comments' to their proposed rule making, and justify their actions based upon the comments, so I don't see this as a lost cause as the tone from some responses implies. My understand this is a federal requirement across the board, so reinforcing key points may be worthwhile.

Just a thought.

[Tom Servo]

Here's the link to the actual proposal.

Prince Law has a few posts here about venues and methods of action.

[TXAZ]

Good Link to the description Tom!

[Tom Servo]

Those guys are really on top of things. I've printed out the whole thing, and I'm trudging through it now. It's not an easy read.

It looks as if anyone named in any capacity in the trust will be a "responsible person," and thus subject to the new requirements:

The Department proposes amending § 479.11 to add a definition for the term “responsible person.” (...) Depending on the context, the term includes any individual, including any grantor, trustee, beneficiary, partner, member, officer, director, board member, owner, shareholder, or manager, who possesses, directly or indirectly, the power or authority under any trust instrument, contract, agreement, article, certificate, bylaw, o rinstrument, or under state law, to receive, possess, ship, transport, deliver, transfer, or otherwise dispose of a firearm for, or on behalf of, the entity.

There's some language about changing the wording of the CLEO signoffs, but they're not going anywhere. They're being expanded to cover pretty much everyone, though the change in wording might persuade some reluctant LEO's to sign.

I'm really wishing the NFATCA had kept their mouths shut on this one.

[Willie Lowman]

Well, this is their response about not keeping their mouths shut.
This From one of the board members:

We were aware that the Trust thing was going to blow up on the NFA community and we let people know. We tried to negotiate but there were a lot of people on the Internet publicly explaining how to open an NFA Trust and “Wink Wink” there were no background checks and you could put all your friends in the trust and they could all get access to the guns. No one could ever know who was in the trust “Wink Wink.” We all saw the posts, anyone who knew how the world works, cringed. Once again the braggarts posting their questionable behavior had screwed the NFA Community.

We offered that the massive increase in NFA transfers to trusts was due to the antiquated CLEO provision and it being a pain to get a signature at best, and de facto gun control in many areas at worst. Our suggestion was remove CLEO and it would remove the motivation of a large portion of the Trust applicants’ need to use a trust and put them through simple ownership process and transfer using a modern method.

They were going to hammer the Trusts etc anyway with elimination or 100% background checks, the fact is we were good on this until the idiots who were abusing it so that their felon friends could get access to NFA firearms in a trust trumpeted it all over the place and made their abuse of the system not just an insider thing for them, but told every LE and ATF person in the country what they were doing. Don’t blame the NFATCA, blame the loudmouths and abusers who made this an issue.

[Tom Servo]

This proposal repeatedly states that the NFATCA themselves brought up the the trust "loophole" as a potential venue for criminal possession of NFA weapons. In fact, it says so with such frequency that it would constitute a gross misrepresentation to the point of slander if it wasn't true.

The NFATCA's response (direct link) to this question has been less than encouraging.

I was willing to consider the idea that they hadn't thrown us under the bus, but now I'm not so sure. In any case, it's reasonable to expect a detailed and plausible explanation from them before supporting them in any way.

The link for leaving comments on the proposal is here. If you wish to submit a comment, please do so the right way. Make your point in a civil, succinct fashion. Use facts, not emotions, to make your argument, and avoid broad politicking. We have a slight advantage in that this is a very obscure regulation, and as such, its supporters can't really manipulate a mass of uninformed people on the issue.

[Skans]

So, does this mean that if the rule change goes through, and everyone will need CLEO signoff's again, silencer manufacturers are basically dead?

[HopeandChange]

Idiots. I've never read a single "wink wink" suggestion on any forum ever.

I never even thought of the notion of adding friends or some nonsense to a trust until reading these knuckle heads' writings.

[Tom Servo]

So, does this mean that if the rule change goes through, and everyone will need CLEO signoff's again, silencer manufacturers are basically dead?

I'm not sure why it would. The rules apply to ownership, not manufacture.

[Willie Lowman]

I think he means that the boom in sales suppressor manufacturers have experienced will end.

[Skans]

^^Yes, that's what I meant.

[Tom Servo]

I think he means that the boom in sales suppressor manufacturers have experienced will end.

It could, but I doubt it. NFA owners are used to dealing with troublesome and inconvenient regulations.

[JohnKSa]

I never even thought of the notion of adding friends or some nonsense to a trust until reading these knuckle heads' writings.

That may be true, but that doesn't mean things like that aren't going on. There's an LGS in my area that has a trust set up and if you want to buy a silencer from them they'll sell it you and add you to their trust, no questions asked.

[Rikakiah]

Originally Posted by Willie Lowman

I think he means that the boom in sales suppressor manufacturers have experienced will end.

I think the likely 9 month wait time (at least if your dealer has to order it first) is more of a damper to sales. I guess I'm blessed with my CLEO as I got the forms signed in under 48 hours. While I'm sure there's several negative CLEOs out there, I can't imagine they're a majority.

Unless a large bulk of sales are from stunts like that gun shop, in which case, I'd dare say those sales should stop anyway.

[Tom Servo]

There's an LGS in my area that has a trust set up and if you want to buy a silencer from them they'll sell it you and add you to their trust, no questions asked.

I could see some potential liability problems there.

[Spats McGee]

Originally Posted by JohnKSa

That may be true, but that doesn't mean things like that aren't going on. There's an LGS in my area that has a trust set up and if you want to buy a silencer from them they'll sell it you and add you to their trust, no questions asked.

I agree with Tom. At the very least, it's foolish on the part of the LGS. It's equally foolish on the part of a law-abiding citizen who wants a silencer. For pity's sake, if I'm going to cough up the dough for an NFA item, I really don't want goodnessknowshowmany strangers in my trust with me.

[HopeandChange]

That may be true, but that doesn't mean things like that aren't going on. There's an LGS in my area that has a trust set up and if you want to buy a silencer from them they'll sell it you and add you to their trust, no questions asked.

My God. I thought AZ had the monopoly on FFLs with monumentally poor judgement.

[tepin]

This is exactly why I did my SBR after Obama got reelected.

ATF will need to grandfather stamps already issued. It will be interesting to see what they do with submitted but not yet approved NFA applications.

I assume public comments don't matter, they have already decided.

[Tom Servo]

if I'm going to cough up the dough for an NFA item, I really don't want goodnessknowshowmany strangers in my trust with me.

It's not just that. The ATF has revoked approval for trusts after previously granting it. If something is amiss with the store's trust, I could lose the items I registered under it.

Given the current "OMG felons can register machine guns in a trust" mentality, there's a good chance the ATF would review that one very closely.

[tepin]

Even worse, if the Trust is invalidated, the items (suppressor, SBR, etc...) in question are no longer registered under the NFA and possession is therefore a violation of the NFA.

[Spats McGee]

Originally Posted by Tom Servo

It's not just that. The ATF has revoked approval for trusts after previously granting it. If something is amiss with the store's trust, I could lose the items I registered under it.

That's Problem #1. Problem #2 is this: If you use a trust, the trust owns the NFA item. So if something should happen to me, how will the value of those items be transferred to my estate? (Not that I ever expect to own a large number of NFA items, but if I've paid for them, I don't want my family to have to fight with everyone else in the trust over that $.)

[tepin]

I did a Trust. My wife is co-trustee. When we die my brother becomes trustee and he amends the trust to include his wife and kid etc.... Trust never dies. It all depends on how it is written.

[Bartholomew Roberts]

Trust never dies

In some states, a trust that never terminates is invalid.

[JohnKSa]

I agree with Tom. At the very least, it's foolish on the part of the LGS. It's equally foolish on the part of a law-abiding citizen who wants a silencer. For pity's sake, if I'm going to cough up the dough for an NFA item, I really don't want goodnessknowshowmany strangers in my trust with me.

It's a spectacularly bad idea. I can't imagine what's going to happen to all those trustees and their toys when it all collapses--and I think it's a sure thing that it will sooner or later.