News and Views about Happenings in the Firearms Industry from Classic Arms Company, Inc.
Friday, September 23, 2011
Gun Collections Pose Special Estate Problems
Peter J Reilly, Contributor Forbes 9/22/11 Taxes are a heavy component of estate planning, but it is important to be alert for other issues. Even though much of my practice is in a right-to-carry state (Florida), it hadn’t ever crossed my mind that guns require special attention in estate plans until I received a heads up from Allen J. Margulis of Total Counsel Law Group. I asked Attorney Margulis if he would like to do a guest post on the subject of gun trusts and he was gracious enough to provide the following:
People may collect guns for self‐defense, target shooting or hunting. Guns may be investments or heirlooms. Many gun owners want their guns to be used responsibly and be passed on to those who appreciate them. Title II of the Gun Control Act of 1968 is known as the National Firearms Act or NFA. It regulates short‐barreled rifles and shotguns, suppressors, machine guns, weird contraptions (AOWs), and DDs (explosives). Certain firearms and accessories are federally restricted. A state may restrict them further. For example, short‐barreled rifles, automatic weapons, silencers and other such items, require a federal tax stamp to acquire as well as the approval of the local Chief Law Enforcement Officer (CLEO.) There are many regulations and issues surrounding passing guns down to one’s heirs that are not present with a bank account, chair, picture or other type of property. We must consider not only where the beneficiary lives, the laws of that state, the laws of the state where the items are located, the eligibility of the beneficiary to be in possession, but also:
(1) Is it a good idea to put a weapon in the hands of the beneficiary? Are they mature and responsible enough?
(2) If not, what will we do?
A Gun Trust is a special purpose revocable living trust. A Gun Trust is written to hold only firearms. The owner of the gun is the trustee and the beneficiary. The owner appoints successor trustees and lifetime and remainder beneficiaries. The trust can be amended or revoked at any time and the owner can name and remove beneficiaries. In the past, Gun Trusts were created primarily for NFA restricted firearms (Title II items ‐ silencers, short-barreled rifles, shotguns, and machine guns) but lately they have attracted the attention of those who own “assault weapons” (being redefined by the current legislation as anything with a removable cartridge).
Gun Trusts are used for two main reasons. The first is to expedite a transfer of a National Firearms Act firearm. Using a trust means you do not have to obtain the approval of your local Chief Law Enforcement Officer (CLEO) and the application can be sent directly to BATF. This saves a lot of time. Registration of a NFA firearm to an individual or corporation takes approximately one to three months to complete. The firearm cannot be handled or transported by any other private individual unless the firearm’s registered owner is present. However, NFA items owned by properly drafted trusts may be legally possessed by any Trustee and a beneficiary may use the item in the presence or under the authority of the Trustee. The second reason is to provide detailed instructions over disposition of one’s gun collection.
Many gun dealers make trust forms available. The problem is that they are usually just standard revocable living trusts, not specifically written about firearms ownership. They typically do not provide guidance or limitations for the Trustee who may find him or herself committing a felony in the way the items are used, held, transferred or sold. Some people cannot legally possess firearms. Some transfers are illegal. A properly written “Gun Trust” for NFA purposes is far more than a form. It helps the decedent’s loved ones deal with items that are problematic at best under both state law and federal law. Improper administration of regulated firearms can result in a criminal conviction and fines. Certain conduct constitutes a criminal offense, including receiving or possessing a firearm transferred to oneself in violation of the NFA; receiving or possessing a firearm made in violation of the NFA; receiving or possessing a firearm not registered to oneself in the National Firearms Registration and Transfer Record; transferring or making a firearm in violation of the NFA; or obliterating, removing, changing, or altering the serial number of the firearm. Penalties can include up to ten years in federal prison; forfeiture of all devices or firearms in violation, forfeiture of all rights to own or possess firearms in the future and a penalty of $10,000 for certain violations.
Wednesday, September 21, 2011
Ind. gun owner sues city over removal from zoo
Updated 04:23 p.m., Tuesday, September 20, 2011
EVANSVILLE, Ind. (AP) — An Evansville man has sued the city, claiming police violated a new state law when they made him leave the Mesker Park Zoo for refusing to cover a gun on his hip.
An attorney for Benjamin A. Magenheimer said the man was singled out because he was carrying a gun, and police and zoo employees clearly violated a new law that allows local governments to ban guns only from buildings that house courtrooms. Local ordinances banning firearms from other locations, such as libraries and parks, are no longer allowed.
According to a police report, zoo officials called police Sept. 10 after several patrons complained about a man who was visibly carrying a handgun. When one of the officers asked him to conceal the weapon, the man refused and "started getting loud and causing a scene," the report said.
Officers asked the man to leave the zoo because he was frightening other patrons, the report said. He refused and police escorted him out. After he left, zoo staff reportedly told police that Magenheimer told them he could not be denied his right to bear arms.
Magenheimer has a license to carry a gun and had a copy on his person at the time, the suit said. Gun licenses do not require concealment, the newspaper reported.
Magenheimer's attorney, Guy Relford of Zionsville, disputed the police report's claim that Magenheimer was argumentative.
"At no point did he become disorderly in any way," Relford said.
But City Attorney David Jones said Magenheimer was removed from the zoo for causing a disturbance, not just for carrying a gun. He said the city would fight the lawsuit, which was filed Friday in Vanderburgh Circuit Court.
"To me, it's not about the gun. I don't think you have a right to intimidate or frighten people or create the disturbance he created. To go into a petting zoo area with a gun, where there are children, that's just idiotic," Jones said.
The lawsuit names Evansville and its Department of Parks & Recreation as defendants. It seeks financial damages, a court declaration finding the city's actions were illegal and an injunction preventing future similar actions by the city.
Jones said Evansville has no ordinances or policies that restrict firearms. He said city officials reviewed the issue after the law was passed this summer. The law took effect July 1.
Jones said the law doesn't give local governments much leeway.
"It's poorly written. I don't think it was given much thought as to situations such as this," he said.
Relford also is representing two clients in a similar lawsuit against Hammond that was filed after the city council rejected an ordinance that would have brought local laws in line with the state change. The city directed its police officers not to enforce Hammond's ban on carrying firearms in municipal buildings earlier this month, but the city's law against carrying guns in public buildings and parks remains in place.
Mexico still waiting for answers on Fast and Furious gun program
Top Mexican officials say the U.S. kept them in the dark. One official was stunned to learn that the cartel hit men who killed her brother had assault rifles from Fast and Furious in their arsenal.
By Ken Ellingwood, Richard A. Serrano and Tracy Wilkinson, Los Angeles Times
5:00 PM PDT, September 19, 2011
Reporting from Mexico City and Washington
Last fall's slaying of Mario Gonzalez, the brother of a Mexican state prosecutor, shocked people on both sides of the border. Sensational news reports revealed that cartel hit men had tortured Gonzalez, and forced him to make a videotaped "confession" that his high-powered sister was on the take.
But American authorities concealed one disturbing fact about the case from their Mexican counterparts: U.S. federal agents had allowed AK-47 assault rifles later found in the killers' arsenal to be smuggled across the border under the notorious Fast and Furious gun-trafficking program.
U.S. officials also kept mum as other weapons linked to Fast and Furious turned up at dozens of additional Mexican crime scenes, with an unconfirmed toll of at least 150 people killed or wounded.
Months after the deadly lapses in the program were revealed in the U.S. media — prompting congressional hearings and the reassignment of the acting chief of the Bureau of Alcohol, Tobacco, Firearms and Explosives — top Mexican officials say American authorities have still not offered them a proper accounting of what went wrong.
Marisela Morales, Mexico's attorney general and a longtime favorite of American law enforcement agents in Mexico, told The Times that she first learned about Fast and Furious from news reports. And to this day, she said, U.S. officials have not briefed her on the operation gone awry, nor have they apologized.
"At no time did we know or were we made aware that there might have been arms trafficking permitted," Morales, Mexico's highest-ranking law enforcement official, said in a recent interview. "In no way would we have allowed it, because it is an attack on the safety of Mexicans."
Morales said she did not want to draw conclusions before the outcome of U.S. investigations, but that deliberately letting weapons "walk" into Mexico — with the intention of tracing the guns to drug cartels — would represent a "betrayal" of a country enduring a drug war that has killed more than 40,000 people. U.S. agents lost track of hundreds of weapons under the program.
Concealment of the bloody toll of Fast and Furious took place despite official pronouncements of growing cooperation and intelligence-sharing in the fight against vicious Mexican drug-trafficking organizations. The secrecy also occurred as President Felipe Calderon and other senior Mexican officials complained bitterly, time and again, about the flow of weapons into Mexico from the U.S.
Patricia Gonzalez, the top state prosecutor in Chihuahua at the time of her brother's 2010 kidnapping, noted that she had worked closely with U.S. officials for years and was stunned that she did not learn until many months later, through media reports, about the link between his death and Fast and Furious weapons.
"The basic ineptitude of these officials [who ordered the Fast and Furious operation] caused the death of my brother and surely thousands more victims," Gonzalez said.
Fast and Furious weapons have also been linked to other high-profile shootings. On May 24, a helicopter ferrying Mexican federal police during an operation in the western state of Michoacan was forced to land after bullets from a powerful Barrett .50-caliber rifle pierced its fuselage and armor-reinforced windshield. Three officers were wounded.
Authorities later captured dozens of drug gang gunmen involved in the attack and seized 70 weapons, including a Barrett rifle, according to a report by U.S. congressional committees. Some of the guns were traced to Fast and Furious.
Email traffic and U.S. congressional testimony by ATF agents and others make clear that American officials purposefully concealed from Mexico's government details of the operation, launched in November 2009 by the ATF field offices in Arizona and New Mexico.
In March 2010, with a growing number of guns lost or showing up at crime scenes in Mexico, ATF officials convened an "emergency briefing" to figure out a way to shut down Fast and Furious. Instead, they decided to keep it going and continue to leave Mexico out of the loop.
Communications also show that the U.S. Embassy, along with the ATF office in Mexico, at least initially, was also kept in the dark.
In July 2010, Darren Gil, the acting ATF attache in Mexico City, asked his supervisors in the U.S. about guns in Mexico but got no answer, according to his testimony before a U.S. congressional committee investigating the matter.
"They were afraid that I was going to either brief the ambassador or brief the government of Mexico officials on it," Gil said.
Part of the reason for not telling Mexican authorities, Gil and others noted, is the widespread corruption among officials in Mexico that has long made some U.S. officials reluctant to share intelligence. By late last year, however, with the kidnapping of Mario Gonzalez and tracing of the AK-47s, some ATF officials were beginning to tell their superiors that it was time to inform the Mexicans.
Carlos Canino, an ATF agent at the U.S. Embassy in Mexico City, warned headquarters that failure to share the information would have dire consequences for the U.S.-Mexican relationship.
"We need to tell them [Mexico] this, because if we don't tell them this, and this gets out, it was my opinion that the Mexicans would never trust us again," Canino testified to congressional investigators in Washington.
Atty. Gen. Morales said it was not until January that the Mexican government was told of the existence of an undercover program that turned out to be Fast and Furious. At the time, Morales said, Mexico was not provided details.
U.S. officials gave their Mexican counterparts access to information involving a group of 20 suspects arrested in Arizona. These arrests would lead to the only indictment to emerge from Fast and Furious.
"It was then that we learned of that case, of the arms trafficking," Morales told The Times. "They haven't admitted to us that there might have been permitted trafficking. Until now, they continue denying it to us."
In March, after disgruntled ATF agents went to congressional investigators, details of Fast and Furious began to appear in The Times and other U.S. media. By then, two Fast and Furious weapons had been found at the scene of the fatal shooting of a U.S. border agent near Rio Rico, Ariz.
As well, a second agent had been killed near the Mexican city of San Luis Potosi, sending theATF hierarchy into a "state of panic," ATF supervisor Peter Forcelli said, because of fears the weapons used might have arrived in Mexico as part of Fast and Furious. So far, all the U.S. government has said in the latter case is that one of the weapons was traced to an illegal purchase in the Dallas area.
In June, Canino, the ATF attache, was finally allowed to say something to Atty. Gen. Morales about the weapons used by Mario Gonzalez's captors, thought to be members of the powerful Sinaloa cartel.
"I wanted her to find out from me, because she is an ally of the U.S. government," he testified.
Canino later told congressional investigators that Morales was shocked.
"Hijole!" he recalled her saying, an expression that roughly means, "Oh no!"
Canino testified that Fast and Furious guns showed up at nearly 200 crime scenes.
Mexican Congressman Humberto Benitez Trevino, who heads the justice committee in the Chamber of Deputies, said the number of people killed or wounded by the weapons had probably doubled to 300 since March, when he said confidential information held by Mexican security authorities put the figure at 150. The higher number, he said, was his own estimate.
A former attorney general, Benitez labeled the operation a "failure," but said it did not spell a collapse of the two nations' shared fight against organized crime groups.
"It was a bad business that got out of hand," he said in an interview.
Many Mexican politicians responded angrily when the existence of the program became known in March, with several saying it amounted to a breach of Mexican sovereignty. But much of that anger has subsided, possibly in the interest of not aggravating the bilateral relationship. For Mexico, the U.S. gun problem goes far beyond the Fast and Furious program. Of weapons used in crimes and traced, more than 75% come from the U.S.
"Yes, it was bad and wrong, and you have to ask yourself, what were they thinking?" a senior official in Calderon's administration said, referring to Fast and Furious. "But, given the river of weapons that flows into Mexico from the U.S., do a few more make a big difference?"
Still, Mexican leaders are under pressure to answer questions from their citizens, with very little to go on.
"The evidence is over there [north of the border]," Morales said. "I can't put a pistol to their heads and say, 'Now give it to me or else.' I can't."
Gun seller who helped ATF had doubts about the sting
By TBO.com | Los Angeles Times
In the fall of 2009, ATF agents installed a secret phone line and hidden cameras in a ceiling panel and wall at Andre Howard's Lone Wolf gun store.
They gave him one basic instruction: Sell guns to every illegal purchaser who walks through the door.
For 15 months, Howard did as he was told. To customers with phony IDs or wads of cash he normally would have turned away, he sold pistols, rifles and semi-automatics. He was assured by the ATF that they would follow the guns and that the surveillance would lead the agents to the violent Mexican drug cartels on the Southwest border.
When Howard heard nothing about any arrests, he questioned the agents. Keep selling, they told him. So hundreds of thousands of dollars more in weapons, including .50-caliber sniper rifles, walked out the front door of his store in a Glendale, Ariz., strip mall.
He was making a lot of money, but he also feared somebody was going to get hurt.
"Every passing week, I worried about something like that," he said. "I felt horrible and sick."
Late in the night on Dec. 14, in a canyon west of Rio Rico, Ariz., Border Patrol agents came across Mexican bandits preying on illegal immigrants, authorities say.
According to a Border Patrol "Shooting Incident" report, the agents fired two rounds of beanbags from a shotgun. The Mexicans returned fire. One agent fired back with his sidearm, another with his M-4 rifle.
One of the Mexicans, Manuel Osorio-Arellanes, a 33-year-old from Sinaloa, was wounded in the abdomen and legs. Agent Brian Terry — 40, single, a former Marine — also went down. "I'm hit!" he cried.
A fellow agent cradled his friend. "I can't feel my legs," Terry said. "I think I'm paralyzed." A bullet had pierced his aorta. Tall and nearly 240 pounds, Terry was too heavy to carry. They radioed for a helicopter. But Terry was bleeding badly, and he died in his colleague's arms.
The Mexicans left Osorio-Arellanes behind and escaped across the desert, tossing two AK-47 semi-automatics from Howard's store.
000 firearms from the Lone Wolf Trading Co. store and others in southern Arizona were sold under an ATF program called Fast and Furious that allowed "straw purchasers" to walk away with the weapons and turn them over to criminal traffickers. But the agency's plan to trace the guns to the cartels never worked. As the case of the two Lone Wolf AK-47s illustrates, the ATF, with a limited force of agents, did not keep track of them.
Some 2,
The Department of Justice in Washington said last week that one other Fast and Furious firearm turned up at a violent crime scene in this country. They have yet to provide further details. They said an additional 28 Fast and Furious weapons were recovered at violent crimes in Mexico. They have not identified those cases either. Mexican government officials maintain that Fast and Furious weapons have been found at some 170 crime scenes in their country.
* * * * *
Howard said he does not own a gun, does not hunt and does not belong to the National Rifle Association. His love is helicopters. A former Army pilot, he gives flying lessons. He said he fell into the gun-dealing business 21 years ago only to help support his career as a flight instructor. Howard spoke to a reporter for the first time in depth about why he cooperated with the federal Bureau of Alcohol, Tobacco, Firearms and Explosives.
He said he supported law enforcement and never imagined a thousand weapons, or half of the entire Fast and Furious inventory, would "walk" out of his store. And when arrests were not forthcoming, "every passing week I was more stunned," he said.
According to a confidential memo written by assistant federal prosecutor Emory Hurley, "Mr. Howard had expressed concerns about the cooperation he was providing and whether he was endangering himself or implicating himself in a criminal investigation."
Other firearms dealers shared his concerns. At the nearby Scottsdale Gun Club, the proprietor sent an email to Agent David Voth. "I want to help ATF," he said, "but not at the risk of agents' safety because I have some very close friends that are U.S. Border Patrol agents in southern AZ."
Howard recalled that a chubby, bald and "very confident" man named Jaime Avila walked into the store on Jan. 16, 2010, and bought the AK-47s. Under the Fast and Furious protocol, agents were supposed to use the video cameras, surveillance, informants and law enforcement intelligence to follow the weapons and hope they led to drug cartels.
No agents were watching on the hidden cameras or waiting outside to track the firearms when Avila showed up. Howard faxed a copy of the sale paperwork to the ATF "after the firearms were gone," assuming they would catch up. They never did.
From November 2009 through June 2010, according to an ATF agent's email to William Newell, then the special agent-in-charge in Phoenix, Avila walked away with 52 firearms after he "paid approximately $48,000 cash. The firearms consisted of FN 5.7 pistols, 1 Barrett 50 BMG rifle, AK-47 variant rifles, Ruger 9mm handguns, Colt 38 supers, etc."
In spring or early summer 2010 — the exact date is unknown — U.S. immigration officers reportedly stopped Avila at the Arizona border with the two semi-automatics and 30 other weapons. According to two sources close to a congressional investigation into Fast and Furious, the authorities checked with the ATF and were told to release him with the weapons because the ATF was hoping to track the guns to cartel members.
In Washington, ATF officials declined to comment. In Congress, Rep. Darrell Issa, R-Calif., chairman of the House investigating committee, and Iowa Sen. Charles E. Grassley, the top Republican on the Senate Judiciary Committee, asked the Justice Department why Avila was not jailed and the guns seized. They have yet to receive an answer.
The two semi-automatics would turn up again — at the scene of the Terry shooting. According to sources, they were hidden in backpacks and stashed in the desert, ready for Mexican bandits.
When weapons were recovered at the scene of the agent's slaying, ATF officials in Phoenix scrambled. "All these ATF guys were showing up," one law enforcement official recalled. "We were trying to catch suspects and rope up the crime scene, and all the ATF guys were saying they needed the serial numbers! They needed the serial numbers!"
Newell wanted an immediate trace on the semi-automatics, and that afternoon ATF agents showed up at the Lone Wolf store. Howard had heard of Terry's death. "I was scared to death," he said. They asked for his paperwork and matched the serial numbers. "Both of them were in shock, too," he said. "You could tell they were sick."
A little before 8 that night, the Phoenix ATF field office sent out an agency-wide bulletin: The suspect guns were Fast and Furious weapons. In Washington the next morning, then-ATF Acting Director Kenneth E. Melson prepared to notify the Border Patrol.
Avila was arrested and initially held for using a bad address on the purchase form. "This way," Voth emailed the ATF field office, "we do not divulge our current case (Fast and Furious) or the Border Patrol shooting case."
In a subsequent report for Fast and Furious classified "Law Enforcement Sensitive," agents said Avila was buying for a Phoenix-based gun trafficking group that hid the weapons in vehicle compartments and drove them over the border from Arizona and Texas. The trafficking group used cash from drug sales to buy the weapons. The AK-47 was their weapon of choice, bought after cocaine and methamphetamines warehoused in Baja California were shipped north and sold in this country.
Other Avila weapons from Howard's store wound up at a Glendale home and a Phoenix automotive business, both "firearm drop locations," according to the ATF report. Still more were recovered in Sonora, Mexico, not far from Rio Rico.
In January, Avila and 19 others were charged in the straw purchasing. It was the only indictment to come out of 15 months of Fast and Furious. Asked at the news conference touting the charges whether the ATF allowed guns to "walk," Newell, the ATF field supervisor, responded, "Hell no!"
His denial and the agent's death provoked a small group of ATF whistleblowers. They contacted Congress, and investigators asked the agency whether Terry was shot by Fast and Furious weapons.
The ATF replied that neither semi-automatic fired the fatal bullet.
In truth, an FBI ballistics report could determine whether one of the semi-automatics or a third weapon killed Terry.
Avila pleaded not guilty to the firearms charges, was released on bail and has yet to stand trial.
