Consignment

[papasmurf]

I own a consignmnet business in Texas. Just a plain and simple East Texan. I have someone wanting me to try to sell a gun for him on consignment. I know that guns can be sold face to face without a problem--done it myself at a few garage sales...but not sure about doing it for someone else.

I think I've seen them at Estate Auctions, etc. But, don't want to get into any potential legal issues down the road.. What do you think? Thanks

 

[sumpnz]

To sell a gun as a part of a commercial enterprise, as far as I am aware you do need an FFL. If this is a one time event it will not be worth your while to get a license if they'd even grant you one. If you want to go into selling guns on consignment as a regular thing, then it might be something worth looking into.

IANAL, so this opinion is worth exactly what you paid for it.

 

[Floppy_D]

Google turned this up. Nothing on Texas, but I don't see it being different.

7.46.010 Gun dealer defined.

“Gun dealer” means any person, firm or corporation who sells or otherwise transfers to the public any pistol, revolver, rifle, shotgun, or other firearm, including those persons required by Section 12070(a) of the California Penal Code to obtain a license under California Penal Code Section 12071. “Gun dealer” also includes any person, firm or corporation who purchases, takes in trade or accepts on consignment from the public any firearm of any type, including, but not limited to pistols, revolvers, rifles and shotguns. (Ord. 97-0009 § 1, 1997: Ord. 91-0064 § 1 (part), 1991: Ord. 11282 § 1 (part), 1976: Ord. 5860 Ch. 2 Art. 19 § 760, 1951.)

I was in a consignment shop in South Carolina, and saw a Marlin 336 up with a price tag, and nothing indicating that this was a gun shop as well. I asked if the owner was an FFL, and he told me "No, that's my rifle, I'm not selling it for anyone else. When I sell it, it will be a face-to-face transaction." He probably bought it from someone wanting to put it on consignment, and went to sell it as his own. I always wondered if he wasn't asking for trouble or not.

 

[sumpnz]

I was in a consignment shop in South Carolina, and saw a Marlin 336 up with a price tag, and nothing indicating that this was a gun shop as well. I asked if the owner was an FFL, and he told me "No, that's my rifle, I'm not selling it for anyone else. When I sell it, it will be a face-to-face transaction." He probably bought it from someone wanting to put it on consignment, and went to sell it as his own. I always wondered if he wasn't asking for trouble or not.

He is taking a heck of a risk. If he kept it at home, and just advertised it on gun boards, classifieds, etc he'd be fine. If the BATF comes into his shop for any reason (even if just an off duty agent looking for a coffee table) he'll have some 'splainin to do.

 

[wishin]

I'm pretty sure you'd be classed as a dealer since it's not your gun and therefore would need an FFL. Could be wrong.

 

[NavyLCDR]

If this is a one time event it will not be worth your while to get a license if they'd even grant you one.

Wow. I can't believe you posted that. We are talking Federal prison time here.

Papasmurf, you run your consignment business for profit and livelihood, do you not? A gun on consignment in your shop would be part of the profit and livelihood, would it not? Therefore you are selling a firearm for profit and livelihood which is EXACTLY the definition of a dealer in firearms and requires a Federal license.

Do cops ever shop in your store? Maybe not in uniform, but I bet a cop has shopped there. They see a gun in there for sale with the rest of the merchandise and make a phone call.... the ATF is closing your doors for investigation.

Now, can I sell a gun for a friend of mine without an FFL? In most states, sure, so long as several conditions are met. ALL parties involved must be residents of the same state. Private sales must be legal in that state and, of course, nobody can be prohibited from possessing that firearm AND, equally important, I cannot keep any portion of the sale as a fee or profit.

It is the same for reloading. I can reload your brass for you, charge you my exact cost for primer, powder and bullet, but I cannot make a profit on either the materials or charge for my time because then I would be manufacturing ammo which requires a license.

 

[sumpnz]

Wow. I can't believe you posted that. We are talking Federal prison time here.

I WAS NOT ENCOURAGING HIM TO BREAK THE FREAKING LAW! I WAS POINTING OUT THAT DEALING WITH GETTING A LICENSE FOR A ONE TIME EVENT WOULD BE MORE EXPENSIVE AND TROUBLESOME THAN WORTH WHILE AND TO NOT BOTHER WITH TAKING THE RIFLE TO SELL AT ALL.

Sorry if that was not clear, but that was my intent.

 

[wishin]

..........cannot keep any portion of the sale as a fee or profit

I think that's the important distinction apart from private ownership.

 

[NavyLCDR]

I WAS NOT ENCOURAGING HIM TO BREAK THE FREAKING LAW! I WAS POINTING OUT THAT DEALING WITH GETTING A LICENSE FOR A ONE TIME EVENT WOULD BE MORE EXPENSIVE AND TROUBLESOME THAN WORTH WHILE AND TO NOT BOTHER WITH TAKING THE RIFLE TO SELL AT ALL.

Sorry if that was not clear, but that was my intent.

AHA! Well, yes, that does change everything! I thought you meant, if you are just going to sell one gun, then it isn't worth the effort to get the license to do it!

Obviously you meant that it is not worth getting the license in order to be able to sell one gun legally! THAT, I completely agree with!

Sorry for the misunderstanding!

 

[Bubbles]

I own a consignmnet business in Texas. Just a plain and simple East Texan. I have someone wanting me to try to sell a gun for him on consignment. I know that guns can be sold face to face without a problem--done it myself at a few garage sales...but not sure about doing it for someone else.

This activity requires a license. There are plenty of FFL's in Texas who can legally consign the gun.

I think I've seen them at Estate Auctions, etc. But, don't want to get into any potential legal issues down the road.. What do you think? Thanks

If the auctioneer doesn't have an FFL, he contracts with one to handle the firearm transfers. The auctioneer never physically takes posession of the gun - it goes from the estate, to the FFL, to the buyer.