Booker, Dean Reintroduce Bicameral Legislation to Close the Fire Sale Loophole

WASHINGTON, D.C. – U.S. Senator Cory Booker (D-NJ) and U.S. Representative Madeleine Dean (PA-04), with original co-sponsors U.S. Representatives Mary Gay Scanlon (PA-05), Eleanor Holmes Norton (D-DC), Eric Swalwell (CA-14), and Steve Cohen (TN-09), reintroduced The Fire Sale Loophole Closing Act of 2023, which addresses dangerous gaps in our gun violence prevention laws. Former Representative David Cicilline (RI-01) introduced this bill in the last six Congresses.

Under current law, federally licensed firearms dealers whose license is revoked or denied renewal may transfer business inventory to their personal collections. They can then sell those firearms without conducting background checks normally required for licensed gun dealers. The Fire Sale Loophole Closing Act would end this dangerous practice.

“We must remain committed in our fight against the gun violence crisis in our country,” said Senator Booker. “Closing the fire sale loophole is a commonsense step that will help ensure firearms aren’t sold without background checks and will help keep deadly weapons out of the wrong hands.”

“Gun violence devastates every one of our communities — it is now the number one cause of death for children and teens in the United States — and as lawmakers, we have an obligation to end the epidemic and save lives,” said Representative Dean. “We know that background checks are a crucial way we can prevent firearms from ending up in the wrong hands — we must enforce our background checks by eliminating any and all ways around them. This bill aims to do just that in order to prevent gun violence and save lives.”

“Too often, individuals prohibited from buying firearms evade the law by acquiring firearms from private sellers without going through a background check or any formal record of the transaction being created. Gun dealers who have had their license revoked, yet have access to significant quantities of guns, can exploit this gap in federal law by converting their business inventory into their “personal collection” and selling their collection privately, with no restrictions. The Fire Sale Loophole Closing Act takes a critical step towards closing this gap by prohibiting gun dealers whose license has been revoked or denied renewal from easily converting and selling their firearms, and instead only permitting the selling of inventory to other licensed dealers. We applaud Congresswoman Dean for her leadership in introducing this common sense legislation,” said Adzi Vokhiwa, GIFFORDS Federal Affairs Director.

“For far too long, gun dealers who have lost their licenses for willful violations of the law have been able to continue selling firearms, creating a clear risk to public safety. The Fire Sale Loophole Closing Act will end this dangerous practice and prevent such former dealers from moving their inventory into their personal collection for later sale. This bill makes it clear if you cannot sell guns responsibly, you cannot sell guns at all. Brady thanks Senator Booker and Congresswoman Dean for introducing this supply-side approach to help free Americans from gun violence,” said Kris Brown, Brady President.

Specifically, the Fire Sale Loophole Closing Act will:

• Stop former Federal Firearms Licensees (FFLs) from transferring business inventory firearms into their personal collections: This restriction bans former FFLs from transferring business inventory firearms to their personal collections, which would enable them to be sold without background checks. This restriction applies immediately upon receiving notice of the revocation/denial.
• Allow transfer to law enforcement or FFLs for 30 days: Former FFLs may transfer business inventory firearms to law enforcement or FFLs for 30 days after revocation or expiration of a license. After the 30 day period has passed, only transfers to law enforcement are permissible.
• Restrict transfer of firearms that were previously converted from business inventory into a personal collection: When a business inventory firearm is converted to a personal collection, it may not be further transferred for a period of one year.

This legislation is endorsed by Giffords, Brady, and Everytown.