New Gun Bill Requires Public List of Dealers Linked to Crime, Bans Them From Federal Contracts for 3 Years

The Clean Hands Firearm Procurement Act aims to increase transparency around gun trafficking by requiring the federal government to publish an annual list of licensed gun dealers who are frequently associated with crime guns. Specifically, the Attorney General, through the ATF, must publicly identify any dealer designated as a “covered firearms dealer” (SEC. 2).

So, what puts a dealer on this public list? The bill defines a “covered firearms dealer” as one where the ATF’s National Tracing Center has traced at least 25 firearms used in crimes, provided the “time-to-crime” was three years or less. This tracing threshold must have been met in at least two of the last three calendar years (SEC. 4). This means the focus is squarely on dealers whose sales quickly end up in the hands of criminals, not just any dealer with a few traced guns over a long period. The "time-to-crime" is the gap between the retail sale and when law enforcement recovers the gun in connection with a crime.

The Federal Contract Blacklist

This public listing isn't just about naming names; it carries a direct financial consequence. The bill prohibits any federal agency from entering into a contract with a licensed dealer if they were listed as a “covered firearms dealer” in the current year or in either of the two preceding years (SEC. 3). If a dealer hits the list, they are effectively banned from federal contracting for three years.

Think about a small business owner who sells specialized equipment to the Department of Defense, or a supplier who handles routine maintenance for a federal agency. If that business also holds a Federal Firearms License (FFL) and meets the crime gun trace threshold, they could suddenly lose a significant portion of their revenue stream. This provision acts as a powerful economic incentive for FFL holders to tighten up their sales practices and inventory controls to avoid being flagged.

The National Security Loophole

However, the contracting ban isn't absolute. The bill carves out a significant exception for national security. The Secretary of Defense or the Secretary of Homeland Security can request a waiver from the Attorney General to contract with a listed dealer if they determine it is necessary to protect U.S. national security (SEC. 3). This means that even if a dealer is identified as a major source of crime guns, the federal government could still do business with them if a high-ranking official deems it essential for security purposes.

If the Attorney General grants such a waiver, they must immediately notify the leadership of the House and Senate Judiciary Committees, though this notification can be classified (SEC. 3). For the average person, this provision is important because it means the economic penalty intended to encourage responsible dealing can be bypassed behind closed doors, raising questions about transparency and accountability when national security is invoked.