CLARIFICATION OF "STRAW MAN TRANSACTIONS"
All Federal Firearms Licensees
The term "Straw Man Transactions" may be familiar to
you. If not, we believe it would be helpful to you to
explain what "Straw Man Transactions" are and offer some
guidance concerning this type of transaction.
"Straw Man Transactions" are of two basic types, each of
which involves a "third party" sale. In the first type,
the dealer may have reason to believe that the person
who executes the Form 4473 is being used as a conduit to
make an illegal sale to a person prohibited by the Gun
Control Act from purchasing a firearm. For instance, a
dealer may be approached by a potential purchaser who,
when asked to identify himself, produces out-of-State
identification or identifies himself as a felon. When
the dealer informs the individual that he cannot sell to
him because he is an out-of-State resident or a felon,
the individual produces a friend who is eligible to
purchase. The friend ("Straw Man") is then used as the
purchaser of record when it is obvious that the actual
recipient is a prohibited person.
The second type of "Straw Man Transaction" is similar to
the first. However, in this instance, it is the dealer
himself who suggests to the potential purchaser that a
third party be used to effect the sale and such a sale
The Gun Control Act of 1968 does not necessarily
prohibit a dealer from making a sale to a person who is
actually purchasing the firearm for another person. It
makes no difference that the dealer knows that the pur-
chaser will later transfer the firearm to another person,
so long as the ultimate recipient is not prohibited from
receiving or possessing a firearm. A dealer may lawfully
sell a firearm to a parent or guardian who is purchasing
it for a minor child. The minor's subsequent receipt or
possession of the firearm would not violate Federal law,
even though the law does prohibit a dealer's direct sale
to the underaged person.
What the Act forbids is the sale or delivery of a
firearm to a person the licensee knows or has reason to
believe is a person to whom a firearm may not be sold
(e.g. a nonresident or a felon) or to a person the
licensee knows will transfer the firearm to a person
prohibited from receiving or possessing it.
A firearms licensee runs the risk of violating the law
when he becomes involved in a transaction where it is
apparent that the purchaser of record is merely being
used to disguise the actual sale to another person, who
could not personally make the purchase or is prohibited
from receiving or possessing a firearm.
Where the dealer knowingly utilizes this technique to
sell a firearm to a prohibited person, both he and the
"third person" or "Straw Man" are placed in a position
of unlawfully aiding the prohibited person's own
We realize that this circular is quite general in tone.
The best advice we can give is that the dealer should be
sure to have Form 4473 completed by the person to whom
the dealer is actually selling the firearm; and if the
dealer has any reason to believe the firearm is being
acquired for a prohibited person, he should avoid the
If you need further advice, do not hesitate to contact
the Bureau of Alcohol, Tobacco and Firearms at the
Office of the local Special Agent in Charge, or the
Regional Regulatory Administrator.