THE WHITE HOUSE

Office of the Press Secretary

             PRESIDENT CLINTON ANNOUNCES LANDMARK REPORT 
           ON GUN INDUSTRY AND BOLD ACTIONS TO CRACK DOWN 
                       ON ILLEGAL TRAFFICKING 

                         February 4, 2000 

President Clinton today, joined by Treasury Secretary Lawrence Summers, will release a new report from the Bureau of Alcohol Tobacco and Firearms (ATF) that provides the most comprehensive overview ever of the firearms industry. The President will also announce landmark regulatory actions that ATF will take to bolster enforcement efforts, and focus on problem dealers, in order to prevent the diversion of firearms from into the hands of criminals. One of the report's key findings is that 1.2 percent of gun dealers account for 57 percent of the total number of crime gun traces. With this evidence in hand, the President will announce several executive actions to help crack down on problem dealers and halt illegal firearms trafficking.

GROUNDBREAKING REPORT ON FIREARMS INDUSTRY. Today, the President will announce the first annual report on Commerce in Firearms in the United States. The report provides never-before released data on the gun industry and ATF's enforcement of the nation's firearms laws. Some of the report's key findings include:

• One Percent of Gun Dealers Account for 57 percent of Crime Gun Traces. The majority (57.4 percent) of firearms traced by law enforcement to gun dealers active in 1998 were sold by 1,020 (1.2 percent) of the 83,272 licensed retail dealers and pawnbrokers. Each of these dealers and pawnbrokers had 10 or more crime guns traced back to them, and 132 of these dealers had 50 or more crime guns traced.
• Handguns Account for Nearly Half of All New Gun Sales - About 2 Million Per Year. Fifty years ago, handguns represented only one out of every 10 new gun sales. Now they account for more than four out of 10. Handguns are the weapons of choice in the commission of gun crimes; two-thirds of all homicides are committed with hand guns.
• Industry Impacted by Stricter Laws. The number of licensed firearms manufacturers, importers, distributors, dealers and collectors peaked at 284,000 in 1994 and has declined to 104,000 today. This decline followed implementation of stricter manufacturer and dealer licensing requirements set forth in the 1993 Brady Act and the 1994 Crime Act. Domestic product shipments in 1997 were valued at about $1.2 billion.

TAKING EXECUTIVE ACTION TO HALT ILLEGAL GUN TRAFFICKING. As part of his strategy to reduce gun violence, the President today will announce new enforcement actions that the ATF will take to focus on problem gun dealers in order to prevent guns from entering into the illegal firearms market. While the vast majority of gun dealers are law-abiding businesspeople who recognize the importance of helping law enforcement identify gun criminals, today's report shows the need to focus resources on the relatively small number of dealers and pawnbrokers who are the source of most of the traced crime guns. With these new actions, ATF will target enforcement and inspection resources on those dealers who have high numbers of crime gun traces, whose guns quickly turn up in crimes after sale, and who have a poor record of cooperation with law enforcement. These actions include:

• Inspecting Disproportionate Sources of Crime Guns. While many gun dealers linked to large numbers of crime guns may be in full compliance with the law, the quick or frequent diversion of guns to illegal markets from those dealers is cause for serious concern. Accordingly, the ATF will conduct focused inspections of the 1,000 gun dealers who had 10 or more crime guns traced to them in 1999. ATF will also require the 450 current dealers that had 10 or more crime guns traced to them with a "time-to-crime" of less than three years from the original sale to provide ATF with information on all used guns offered for sale. This will enable ATF to trace used guns if they are later used in crime. Strong enforcement action will be taken against dealers found to be violating the law. At the same time, ATF will also work closely with law-abiding gun dealers to develop new procedures to prevent illegal trafficking.
• Targeting Uncooperative Dealers. Some dealers fail to respond promptly to ATF crime gun trace requests, or keep poor records, severely eroding the ability of law enforcement to apprehend and prosecute gun criminals. In response, ATF will conduct focused inspections of the 50 dealers with the worst response records, and will issue demand letters requiring them to regularly submit all firearms acquisition and disposition records.
• Focusing on Stolen Firearms. In FY 1999, 1,290 crime guns were traced back to licensed gun dealers (federal firearms licensees, or FFLs) who claimed that the firearms were shipped but never received. To enhance reporting of theft or loss, and to better track stolen and missing firearms, ATF will propose a new rule requiring all FFLs to conduct regular inventories and report discrepancies to ATF. ATF will publish a second rule requiring FFLs who ship firearms to report any firearms lost or stolen in transit within 48 hours.
• Helping the Industry Increase Accountability. To help manufacturers and importers to monitor the distribution of their firearms and learn whether particular models are frequently used in crime, ATF will provide to manufacturers, upon request, a list by serial number of firearms they sold that were traced as crime guns during the previous year.

FIGHTING FOR PASSAGE OF COMMON SENSE GUN LEGISLATION AND THE MOST AGGRESSIVE FIREARMS ENFORCEMENT INITIATIVE IN HISTORY. The President today will also highlight additional proposals to keep guns out of the wrong hands. In his State of the Union Address, President Clinton called for state-based licensing for all handgun purchasers to ensure that all buyers are eligible to possess a firearm and know how to safely handle and store their gun. In addition, the President has proposed an unprecedented $280 million gun enforcement initiative to hire 500 new ATF agents and inspectors, over 1,000 new federal, state and local gun prosecutors, and fund comprehensive crime gun tracing and increased ballistics testing to catch and prosecute more gun criminals. The President's budget also includes $10 million to support research in "smart gun" technologies that can limit a gun's use to its authorized owner. Finally, the President will emphasize again that it is long past time for Congress to pass common-sense gun measures to close the gun show loophole, ban the importation of large capacity ammunition clips, and require child safety locks.

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