Media Contact: Georgia Seltzer, (202) 822-8200 x104, gseltzer@vpc.org
Holders of Federal Gun Manufacturing Licenses Can Use Them to Evade Gun Laws, Buy Guns in Quantity at Wholesale Prices, and Undercut Restrictions on the Possession of New Fully Automatic Machine Guns
Washington, DC — Hundreds of Illinois residents possess a federal license to manufacture firearms, yet relatively few actually produce any guns according to Hidden Gun Manufacturers in Illinois, a new study from the Violence Policy Center (VPC) as part of its ongoing Campaign for Gun Industry Accountability.
The license – known as a Type 07 Federal Firearms License (FFL) and issued by the federal Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) – offers privileges not granted to private citizens buying a gun. These include the ability to bypass background checks and buy and sell firearms in interstate commerce via common carriers (including bulk purchases at wholesale prices). In addition, by paying additional fees to the federal government, license holders can undercut the tight restrictions on the possession of new fully automatic machine guns. The study also offers examples of the online cottage industry that aids private citizens in obtaining the license for personal use.
Unlike traditional commercial manufacturers, many Illinois license holders are located in suburban homes, garages, or unrelated businesses, often hiding in plain sight.
“Hundreds of Illinois residents have a federal license to manufacture guns, yet relatively few actually do,” said Josh Sugarmann, executive director of the Violence Policy Center. “It’s long past time to find out how these ‘ghost’ manufacturers are using or abusing the privileges associated with the license. While in 2019 Illinois enacted new statewide regulations governing gun manufacturers and dealers, it’s time for communities to take a second look at ‘kitchen table’ manufacturers to ensure public safety.”
According to ATF data analyzed by the VPC, in Illinois in 2022:
- Eighty-two percent (186 of 226) of Illinois Type 07 license holders did not report producing any guns that year.
- Of the Type 07 license holders who did report producing guns that year, 38 percent (15 of 40) produced 10 or fewer firearms.
- Nearly one-third of non-manufacturing licensees appeared to be located in residential homes.
- Combined, Type 07 license holders who did not report producing any guns and Type 07 license holders who produced 10 guns or fewer that year represented 89 percent of all Type 07 license holders.
- From 2020 to 2024, the number of Type 07 FFL holders in Illinois rose 27 percent – from 219 to 279. Nationally during this same period, the number of license holders increased 40 percent – from 14,678 to 20,566.
Federal oversight of these license holders is minimal. In 2022, ATF inspected only five percent of all FFL holders nationwide. And while Illinois in 2019 enacted a comprehensive statewide package further regulating gun manufacturers and dealers, questions remain as to the activities of Type 07 license holders.
In addition to the photos contained in the study of Type 07 license holders (both manufacturing and non-manufacturing) who appear to be operating out of homes in residential neighborhoods, the VPC has developed an online interactive mapping tool that allows users, entering their home or any other address, to find nearby FFL holders (gun manufacturers or dealers) – including a Google Earth photo where available of the license holder’s “place of business.”
The study contains both state and federal recommendations. For Illinois specifically, the study’s primary recommendation is that the state and local communities should identify ways to confirm in an ongoing manner that license holders are currently obeying all state and local requirements and relevant local business and zoning regulations. It also urges relevant state agencies to review their business databases to ensure that all Type 07 FFL holders – who are required to have a business license – have obtained the license and are listed with all relevant information on these publicly available online resources.
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The Violence Policy Center is a national educational organization working to stop gun death and injury. Follow the VPC on X/Twitter, Facebook, Instagram, and BlueSky.