I 

118TH CONGRESS 

2D SESSION H. R. 7834 

To improve the licensing requirements for the retail sale of firearms, and 

for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 29, 2024 

Mr. FROST (for himself, Mr. NEGUSE, Mrs. RAMIREZ, and Ms. KELLY of Illinois) introduced the following bill; which was referred to the Committee 

on the Judiciary 

A BILL 

To improve the licensing requirements for the retail sale 

of firearms, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Prevent Illegal Gun 

5 Resales Act’’. 

6 SEC. 2. INCREASED LICENSING FEES. 

7 Section 923 of title 18, United States Code, is 

8 amended— 

9 (1) in subsection (a)— 

10 (A) in paragraph (1)— 


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1 (i) in subparagraph (A), by striking 

2 ‘‘$1,000’’ and inserting ‘‘$2,000’’; 

3 (ii) in subparagraph (B), by striking 

4 ‘‘$50’’ and inserting ‘‘$2,000’’; and 

5 (iii) in subparagraph (C), by striking 

6 ‘‘$10’’ and inserting ‘‘$1,000’’; 

7 (B) in paragraph (2)— 

8 (i) in subparagraph (A), by striking 

9 ‘‘$1,000’’ and inserting ‘‘$2,000’’; and 

10 (ii) in subparagraph (B), by striking 

11 ‘‘$50’’ and inserting ‘‘$2,000’’; and 

12 (C) in paragraph (3)— 

13 (i) in subparagraph (A), by striking 

14 ‘‘$1,000’’ and inserting ‘‘$2,000’’; and 

15 (ii) in subparagraph (B)— 

16 (I) by striking ‘‘$200’’ and in17 serting ‘‘$400’’; and 

18 (II) by striking ‘‘$90’’ and in19 serting ‘‘$180’’; and 

20 (2) in subsection (b), by striking ‘‘$10’’ and in21 serting ‘‘$20’’. 

22 SEC. 3. ANTI-TRAFFICKING PROCEDURES. 

23 (a) DEALER’S LICENSE APPLICATION REQUIRED TO

24 SPECIFY BUSINESS PRACTICES TO PREVENT DIVERSIONS

25 FROM LAWFUL COMMERCE.—Section 923(d)(1)(G) of 


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1 title 18, United States Code, is amended to read as fol2 lows: 

3 ‘‘(G) in the case of an application to be li4 censed as a dealer— 

5 ‘‘(i) the applicant certifies that secure 

6 gun storage or safety devices will be avail7 able at any place in which firearms are 

8 sold under the license to persons who are 

9 not licensees (subject to the exception that 

10 in any case in which a secure gun storage 

11 or safety device is temporarily unavailable 

12 because of theft, casualty loss, consumer 

13 sales, backorders from a manufacturer, or 

14 any other similar reason beyond the con15 trol of the licensee, the dealer shall not be 

16 considered to be in violation of the require17 ment under this subparagraph to make 

18 available such a device); 

19 ‘‘(ii) the applicant submits with the 

20 application a specification of the firearms 

21 business practices, policies, and procedures 

22 of the applicant; and 

23 ‘‘(iii) the Attorney General determines 

24 that the specification describes policies, 


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1 practices, and procedures comply with reg2 ulations prescribed under section 926(d).’’. 

3 (b) REGULATIONS TO REQUIRE LICENSED DEALERS

4 TO IMPLEMENT BUSINESS PRACTICES, POLICIES, AND

5 PROCEDURES TO PREVENT BUSINESS INVENTORY FIRE6 ARMS, AMMUNITION, AND ACCESSORIES FROM BEING DI7 VERTED FROM LAWFUL COMMERCE, AND PREVENT BUSI8 NESS INVENTORY FIREARMS FROM BEING TRANSFERRED

9 TO A STRAW PURCHASER.—Section 926 of such title is 

10 amended by adding at the end the following: 

11 ‘‘(d) The Attorney General shall prescribe regulations 

12 requiring licensed dealers to implement business practices, 

13 policies, and procedures sufficient to prevent firearms, am14 munition, and accessories in the business inventory of a 

15 licensed dealer from being diverted from lawful commerce, 

16 and to prevent business inventory firearms of a licensed 

17 dealer from being transferred to a straw purchaser, and 

18 shall do so in consultation with government entities with 

19 expertise similar to that of the White House Office of Gun 

20 Prevention.’’. 

21 (c) PENALTIES FOR FAILURE TO IMPLEMENT BUSI22 NESS PRACTICES, POLICIES, AND PROCEDURES SPECI23 FIED IN APPROVED DEALER’S LICENSE APPLICATION.— 

24 Section 924 of such title is amended by adding at the end 

25 the following: 


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1 ‘‘(q) The Attorney General may impose a civil money 

2 penalty of not more than $5,000 on, and may suspend 

3 the license issued under section 923 to, any person who 

4 is a licensed dealer who fails to comply with any practice, 

5 policy, or procedure specified in the application approved 

6 under section 923 of the person to become a licensed deal7 er.’’. 

8 SEC. 4. PREVENTING FIREARM TRAFFICKING. 

9 (a) DUTIES OF FIREARM LICENSEES.—Section 

10 923(g) of title 18, United States Code, is amended— 

11 (1) in paragraph (1)(B)— 

12 (A) by striking ‘‘or’’ at the end of clause 

13 (ii); and 

14 (B) by redesignating clause (iii) as clause 

15 (iv) and inserting after clause (ii) the following: 

16 ‘‘(iii) for ensuring compliance with the 

17 regulations prescribed under section 

18 926(d); or’’; 

19 (2) in paragraph (3)(B)— 

20 (A) by inserting ‘‘a firearm involved in a 

21 crime or’’ after ‘‘thereof regarding’’; 

22 (B) by striking ‘‘, and shall destroy each 

23 such form and any record of the contents there24 of no more than 20 days after the date such 

25 form is received’’ and inserting ‘‘and shall reVerDate Sep 11 2014 20:46 Apr 12, 2024 Jkt 049200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H7834.IH H7834

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1 tain each such form and any record of the con2 tents of the form for 180 days after the date 

3 the form is received’’; and 

4 (C) by striking the 2nd sentence; and 

5 (3) by striking paragraph (7) and inserting the 

6 following: 

7 ‘‘(7)(A) Each licensee shall respond immediately to, 

8 and in no event later than 24 hours after the receipt of, 

9 a request by the Attorney General for information con10 tained in the records required to be kept by this chapter 

11 as may be required for determining the disposition of 1 

12 or more firearms in the course of a bona fide criminal 

13 investigation. The requested information shall be provided 

14 orally or in writing, as the Attorney General may require. 

15 The Attorney General shall implement a system whereby 

16 the licensee can positively identify and establish that an 

17 individual requesting information via telephone is em18 ployed by and authorized by the agency to request the in19 formation. 

20 ‘‘(B) Each licensee shall, in the absence of unique 

21 and special circumstances and approved in writing by the 

22 Attorney General, maintain records of all such crime gun 

23 trace requests for firearms disposed of by the licensee 

24 within the preceding 3 years, with copies of the trans25 action records for the firearms in the possession of the 


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1 licensee, if any, to review before the transfer of any fire2 arm. 

3 ‘‘(C) Each licensee shall review all records of crime 

4 gun trace requests before transferring any firearm, and 

5 report sales or other dispositions whenever the licensee 

6 sells or otherwise disposes of any firearm to an unlicensed 

7 person to whom a crime gun has been traced. The report 

8 shall be prepared on a form specified by the Attorney Gen9 eral and forwarded to the office specified thereon and to 

10 the department of State police or State law enforcement 

11 agency of the State or local law enforcement agency of 

12 the local jurisdiction in which the sale or other disposition 

13 took place, not later than the close of business on the day 

14 that the licensee determines that the sale or other disposi15 tion occurs. 

16 ‘‘(D)(i) Each licensed dealer shall update the prac17 tices, policies, and procedures referred to in section 

18 923(d)(1)(G)(ii) of the licensee, whenever— 

19 ‘‘(I) the licensee reports to the Attorney Gen20 eral 5 or more lost or stolen firearms in any period 

21 of 12 consecutive months; or 

22 ‘‘(II) 5 or more firearms that were used in a 

23 crime under Federal, State, or local law within 3 

24 years after the last known retail sale of the firearm 


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1 are traced to the licensee within any such 12-month 

2 period. 

3 ‘‘(ii) Each licensed dealer shall maintain physical 

4 records of costs incurred to implement and update the 

5 business practices, policies, and procedures, including the 

6 installation of audio and video surveillance of firearms 

7 transactions, and the implementation of an electronic 

8 record keeping system, or of physical security to prevent 

9 loss or theft of firearm inventory, and shall make the 

10 records available for inspection on the premises covered 

11 by the license until the licensee ceases to engage in the 

12 business of selling firearms.’’. 

13 (b) DUTIES OF THE ATTORNEY GENERAL.—The At14 torney General shall— 

15 (1) develop, draft, and distribute to persons li16 censed under chapter 44 of title 18, United States 

17 Code, materials setting forth best business practices, 

18 policies, and procedures to prevent the diversion of 

19 firearms inventory from lawful commerce, and from 

20 time to time revise the materials as appropriate; and 

21 (2) during the 3 fiscal years that first begin 

22 after the date of the enactment of this Act, prioritize 

23 for compliance inspections those firearms dealers 

24 that have not been inspected within the then preVerDate Sep 11 2014 02:41 Apr 13, 2024 Jkt 049200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H7834.IH H7834

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1 ceding fiscal year with a high number of crime gun 

2 traces relative to other firearms dealers. 

3 SEC. 5. MENS REA REQUIREMENT FOR VIOLATIONS OF 

4 RULES APPLICABLE TO ONLY LICENSEES. 

5 Section 924(a)(1)(D) of title 18, United States Code, 

6 is amended by striking ‘‘willfully’’ and inserting ‘‘know7 ingly’’. 

8 SEC. 6. FIREARMS TRAFFICKING OFFENSE. 

9 (a) IN GENERAL.—Section 933 of title 18, United 

10 States Code, is amended to read as follows: 

11 ‘‘§ 933. Trafficking in firearms 

12 ‘‘(a) PROHIBITIONS.— 

13 ‘‘(1) IN GENERAL.—It shall be unlawful for any 

14 person to— 

15 ‘‘(A) ship, transport, transfer, cause to be 

16 transported, or otherwise dispose of 2 or more 

17 firearms to another person in or affecting inter18 state or foreign commerce, if the person knows 

19 or has reasonable cause to believe that the use, 

20 carrying, or possession of a firearm by such 

21 other person would constitute a felony (as de22 fined in section 932(a)); 

23 ‘‘(B) receive from another person 2 or 

24 more firearms in or affecting interstate or for25 eign commerce, if the person knows or has reaVerDate Sep 11 2014 20:46 Apr 12, 2024 Jkt 049200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H7834.IH H7834

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1 sonable cause to believe that the receipt would 

2 constitute a felony; or 

3 ‘‘(C) attempt or conspire to commit con4 duct described in paragraph (1) or (2). 

5 ‘‘(2) LICENSEES.—It shall be unlawful for any 

6 licensee to ship, transport, transfer, cause to be 

7 transported, or otherwise dispose of any firearm to 

8 another licensee if the licensee knows or has reason9 able cause to believe that— 

10 ‘‘(A) in the preceding year, 5 or more fire11 arms that were used in a crime under Federal, 

12 State, or local law within 3 years after the last 

13 known retail sale of the firearms have been 

14 traced to such other licensee; 

15 ‘‘(B) in the preceding year, to the knowl16 edge of the licensee, such other licensee has 

17 since failed to implement or update business 

18 practices to prevent firearm trafficking or straw 

19 purchasing; 

20 ‘‘(C) such other licensee lacks adequate se21 curity to prevent loss or theft of firearms or 

22 ammunition from the inventory of such other li23 censee; or 

24 ‘‘(D) in the most recent inspection of such 

25 other licensee under this chapter, the Attorney 


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1 General has found 3 or more violations relating 

2 to failures to timely or accurately record infor3 mation in firearm acquisition and disposition 

4 records. 

5 ‘‘(b) AFFIRMATIVE DEFENSES.—It shall be an af6 firmative defense to a charge of violating— 

7 ‘‘(1) subsection (a)(1) of this section, that the 

8 licensee took all reasonable steps, including the im9 plementation of and updates to business practices 

10 pursuant to subsection 923(g)(7)(D), to prevent the 

11 diversion of inventory firearms from lawful com12 merce; and 

13 ‘‘(2) subsection (a)(2) of this section, that the 

14 licensee took all reasonable steps to comply with 

15 subsection (a)(2) and failed to discover facts that 

16 would render disposition of firearms to a licensee 

17 unlawful under subsection (a)(2) only as the direct 

18 result of a violation of Federal law by the licensee. 

19 ‘‘(c) PENALTIES.— 

20 ‘‘(1) IN GENERAL.—Any person who violates 

21 subsection (a)(1) shall be fined under this title, im22 prisoned for not more than 15 years, or both. 

23 ‘‘(2) LICENSEES.— 

24 ‘‘(A) CIVIL PENALTIES.—Any licensee who 

25 violates subsection (a)(2) shall, after notice and 


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1 opportunity for a hearing, disgorge all profits 

2 from the transfer of the firearms that are the 

3 subject of the violation, and the court may im4 pose on the licensee a civil money penalty equal 

5 to the greater of— 

6 ‘‘(i) $10,000 for each firearm in7 volved, or $50,000 with respect to any 

8 such firearm that was subsequently used in 

9 a crime under Federal, State, or local law; 

10 or 

11 ‘‘(ii) the total amount expended by the 

12 Attorney General in the preceding 3 fiscal 

13 years to trace firearms used in a crime 

14 under Federal, State, or local law, multi15 plied by the percentage of the firearms 

16 traced to the licensee that were recovered 

17 during that period. 

18 ‘‘(B) LICENSE SUSPENSION OR REVOCA19 TION.—In addition to any penalty under sub20 paragraph (A), the Attorney General may, after 

21 notice and opportunity for a hearing, suspend 

22 or revoke the license issued to the licensee 

23 under this chapter in the case of the first viola24 tion of this section and, in the case of any subVerDate Sep 11 2014 20:46 Apr 12, 2024 Jkt 049200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\H7834.IH H7834

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1 sequent violation, shall immediately revoke the 

2 license.’’. 

3 (b) DIRECTIVE TO SENTENCING COMMISSION.— 

4 (1) IN GENERAL.—Pursuant to its authority 

5 under section 994(p) of title 28, United States Code, 

6 the United States Sentencing Commission shall re7 view and, if appropriate, amend the Federal sen8 tencing guidelines and policy statements applicable 

9 to persons convicted of offenses under section 933 of 

10 title 18, United States Code (as added by subsection 

11 (a) of this section). 

12 (2) REQUIREMENTS.—In carrying out this sec13 tion, the Commission shall review the penalty struc14 ture that the guidelines provide based on the number 

15 of firearms involved in the offense and determine 

16 whether any changes to the penalty structure are ap17 propriate in order to reflect the intent of the Con18 gress that the penalties reflect the gravity of the of19 fense, the number of trafficked firearms purchased 

20 by or from the defendant, the extent of the knowl21 edge of the defendant about the overall scheme to 

22 traffic firearms, the amount of money or nonmone23 tary compensation provided to the defendant for the 

24 participation of the defendant, and the culpability of 

25 the defendant, including whether the defendant is a 


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1 licensed manufacturer, importer, or dealer and, as 

2 mitigating factors, whether the defendant is a rel3 ative or current or former intimate partner of an4 other individual involved in a conspiracy to traffic 

5 firearms, is a domestic violence survivor, or has been 

6 otherwise exploited by personal affection, fear of re7 prisal. or economic need to commit an offense under 

8 section 933 of title 18, United States Code. 

9 (c) DIRECTIVE TO ATF.— 

10 (1) DUTY TO INVESTIGATE.—The Director of 

11 the Bureau of Alcohol, Tobacco, Firearms and Ex12 plosives shall investigate the source of firearms traf13 ficked in violation of section 923 or 933 of title 18, 

14 United States Code, and in particular, whether the 

15 source is engaged in the business of importing, man16 ufacturing, or dealing in firearms in violation of sec17 tion 922(a)(1) of such title, and refer prosecutions 

18 of the source to the Attorney General. The Director 

19 shall assess whether regulations, informal guidance, 

20 licensee resources regarding trafficking, and the con21 duct of a firearms transferee would indicate, to a 

22 reasonable person, that the transferee may be vio23 lating section 932 or 933 of such title, and revise 

24 and re-issue the materials developed under section 

25 4(b) of this Act, accordingly. 


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1 (2) GUN TRAFFICKING AWARENESS PRO2 GRAM.—The Director shall establish a program, to 

3 be known as the ‘‘Gun Trafficking Awareness Pro4 gram’’, in which licensees under chapter 44 of title 

5 18, United States Code, who have transferred fire6 arms to an individual who has violated section 

7 932(b) of such title, but who lack the mens rea to 

8 have committed a violation of section 933 of such 

9 title, may be enrolled for purposes of preventing fu10 ture such violations. The program shall include, at 

11 a minimum— 

12 (A) electronic or in-person training of such 

13 a licensee and all employees of the licensee who 

14 are responsible for handling firearms to identify 

15 signs of straw purchasing or gun trafficking; 

16 (B) the adoption by such a licensee of elec17 tronic record keeping and collation of records 

18 relevant to trafficking, including crime gun 

19 trace requests and multiple purchase reports; 

20 and 

21 (C) a requirement that such a licensee who 

22 operates retail premises from which firearms 

23 are transferred maintain audio and video sur24 veillance of all areas of the premises; and 


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1 (D) inspections of such a licensee, as ap2 propriate, and not more frequently than quar3 terly, for a period of 1 year, to ensure compli4 ance with such chapter. 

5 (d) DIRECTIVE TO THE ATTORNEY GENERAL.— 

6 Within 2 years after the date of the enactment of this Act 

7 and annually thereafter, the Attorney General shall submit 

8 to the Committee on the Judiciary of the Senate and the 

9 Committee on the Judiciary of the House of Representa10 tives a report containing the following information: 

11 (1) For the preceding 12-month period— 

12 (A) the number of investigations initiated 

13 for violations of section 933 of title 18, United 

14 States Code; 

15 (B) the number of individuals, entities, 

16 and Federal firearm licensees charged crimi17 nally or civilly for the violations; 

18 (C) the number of individuals, entities, and 

19 Federal firearm licensees indicted for the viola20 tions; 

21 (D) the number of investigations referred 

22 to the Attorney General by the Bureau of Alco23 hol, Tobacco, Firearms and Explosives that did 

24 not result in criminal or civil charges; and 


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1 (E) the number of licensees enrolled in, 

2 and the number of licenses determined to have 

3 successfully completed, the program established 

4 under subsection (c)(2). 

5 (2) To the extent the information is available, 

6 the average length of the sentences of imprisonment 

7 and average and mean monetary fines imposed on 

8 persons convicted of violations of section 933 of title 

9 18, United States Code, during the preceding 12- 

10 month period. 

11 (3) A narrative describing the trafficking 

12 schemes prosecuted in the preceding 12-month pe13 riod, including the sources of firearms, the roles of 

14 various defendants in the scheme, the number of 

15 firearms trafficked, and a description of any traf16 ficking practices or trends common among various 

17 firearm trafficking schemes. 

18 SEC. 7. ENHANCED REGULATION OF HIGH RISK DEALERS. 

19 Chapter 44 of title 18, United States Code, is amend20 ed by adding at the end the following: 

21 ‘‘§ 935. Regulation of high risk dealers 

22 ‘‘(a) IN GENERAL.—On a determination by the At23 torney General that a licensed dealer is a high risk dealer, 

24 the Attorney General shall— 


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1 ‘‘(1) require the dealer to permanently alter the 

2 business practices of the dealer or make physical im3 provements to the firearms business premises of the 

4 dealer to reduce the diversion of firearms from the 

5 firearms inventory of the dealer, which requirements 

6 shall include requiring the dealer to— 

7 ‘‘(A) adopt electronic acquisition and dis8 position record keeping; 

9 ‘‘(B) provide the National Tracing Center 

10 with electronic access to all records required to 

11 be kept under this chapter that are possessed 

12 by the dealer; 

13 ‘‘(C) make video and audio recordings of 

14 all firearms transactions, and maintain the re15 cordings for 360 days; and 

16 ‘‘(D) retain for more than 360 days, any 

17 video or audio recording of a firearm trans18 action that was the subject of a trace request; 

19 and 

20 ‘‘(2) not less frequently than biennially, inspect 

21 or examine the inventory, records, and business 

22 premises of the dealer without reasonable cause or 

23 warrant. 

24 ‘‘(b) CESSATION.—On application of a high risk deal25 er, on a form prescribed by the Attorney General, and apVerDate Sep 11 2014 20:46 Apr 12, 2024 Jkt 049200 PO 00000 Frm 00018 Fmt 6652 Sfmt 6201 E:\BILLS\H7834.IH H7834

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1 proval of the application by the Attorney General in writ2 ing, the inspections of the dealer under subsection (a)(2) 

3 shall cease— 

4 ‘‘(1) on certification by the Attorney General 

5 that the dealer— 

6 ‘‘(A) has permanently altered the business 

7 practices of the dealer or made the physical im8 provements required under subsection (a)(1); 

9 and 

10 ‘‘(B) will maintain the practices and im11 provements until otherwise notified by the At12 torney General; and 

13 ‘‘(2) if, on 2 separate and consecutive occasions 

14 at least 6 months apart, the Attorney General has 

15 inspected and examined the books and records of the 

16 dealer and, during that period, the dealer has not 

17 been notified of any violations of Federal, State, or 

18 local law. 

19 ‘‘(c) NOTICE.—The Attorney General shall inform 

20 high risk dealers in writing of their obligations under this 

21 section. 

22 ‘‘(d) DEFINITION.—The term ‘high risk dealer’ 

23 means any dealer identified by the Attorney General as 

24 lacking sufficient policies, procedures, or controls to pre25 vent the diversion from lawful commerce of firearms or 


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1 ammunition in the firearms business inventory of the deal2 er or transferred by the dealer, and firearms possessed 

3 by the dealer that are to be destroyed, and, thus, necessi4 tating enhanced regulation and enforcement including reg5 ular inspection and examination of the inventory, records, 

6 and premises of the firearms business of the dealer. The 

7 Attorney General shall so identify such a dealer if— 

8 ‘‘(1) the Attorney General has issued to the 

9 dealer a report of violation or warning letter; 

10 ‘‘(2) the dealer has been the subject of a warn11 ing conference with the Attorney General within the 

12 preceding 36 months; or 

13 ‘‘(3) in the preceding 12 months, the dealer was 

14 the source of 2 or more firearms that were used in 

15 a crime under Federal, State, or local law within 36 

16 months after the last known retail sale of the fire17 arm.’’. 

18 SEC. 8. EFFECTIVE DATE. 

19 Sections 2 through 6 shall take effect on the date 

20 that is 180 days after the date of the enactment of this 

21 Act. 

Æ 


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