30 October 1998
Source: http://www.access.gpo.gov/su_docs/aces/aaces002.html

See related ATF rule: http://jya.com/atf102998.txt

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[Federal Register: October 30, 1998 (Volume 63, Number 210)]
[Rules and Regulations]
[Page 58303-58312]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr30oc98-8]

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DEPARTMENT OF JUSTICE

28 CFR Part 25

[AG Order No. 2186-98]
RIN 1105-AA51


National Instant Criminal Background Check System Regulation

AGENCY: Federal Bureau of Investigation, Department of Justice.

ACTION: Final rule.

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SUMMARY: The United States Department of Justice (DOJ) is publishing a
final rule implementing the National Instant Criminal Background Check
System (NICS) pursuant to the Brady Handgun Violence Prevention Act
(``Brady Act''), to provide notice of the establishment of the NICS, to
establish policies and procedures for ensuring the privacy and security
of this system, and to implement a NICS appeals policy for persons
denied acquisition of a firearm based on information in the NICS that
they believe to be erroneous or incomplete.

EFFECTIVE DATE: November 30, 1998.

FOR FURTHER INFORMATION CONTACT: Emmet A. Rathbun, Unit Chief, Federal
Bureau of Investigation, Module C-3, 1000 Custer Hollow Road,
Clarksburg, West Virginia 26306-0147, telephone number (304) 625-2000.

SUPPLEMENTARY INFORMATION: This rule finalizes two notices of proposed
rulemaking: the National Instant Criminal Background Check System
Regulation published in the Federal Register on June 4, 1998 (63 FR
30430), and the National Instant Criminal Background Check System User
Fee Regulation, published in the Federal Register on August 17, 1998
(63 FR 43893). The FBI accepted comments on the proposed rules from
interested parties until September 16, 1998, and approximately 2,000
comments were received.
    In publishing this final rule, the Department also is giving
notice, pursuant to section 103(d) of the Brady Act, Public Law 103-
159, 107 Stat. 1536, to Federal Firearm Licensees (FFLs) and the chief
law enforcement officer of each state that the NICS is established as
of October 31, 1998. With limited exceptions, FFLs are required by the
Brady Act to begin contacting the system beginning on November 30,
1998, thirty days after the establishment of the system, before they
may transfer a firearm to a non-licensee. FFLs shall contact the NICS
by contacting either the FBI NICS Operations Center or a state point of
contact (POC) for the NICS, as specified by the Bureau of Alcohol,
Tobacco, and Firearms (ATF), United States Department of the Treasury.
The ATF will notify each FFL of the method by which FFLs must contact
the NICS in their state.

Significant Comments or Changes

The NICS User Fee

    The largest number of comments pertained to the FBI's proposed user
fee to be charged FFLs that contact the FBI NICS Operations Center
directly for a NICS background check. All of those who commented on the
proposed user fee opposed the fee. This issue was the subject of
Congressional action since the time of the initial publication of the
proposed NICS rule. The Omnibus Appropriations Act for fiscal year 1999
provided additional monies to the FBI to fund the operation of the NICS
and prohibited the FBI from charging a fee for NICS checks.
Accordingly, the FBI will not be charging the user fee set forth in the
proposed NICS user fee regulation. This does not preclude state or
local agencies acting as POCs for the NICS from charging such fees as
may be appropriate under state or local law.

The NICS Audit Log

    A significant number of comments were received opposing the
retention by the NICS of a temporary log of background check
transactions that allow a firearm transfer to proceed. Most of these
comments expressed an opinion that such a log would constitute a
national firearms registry, the establishment of which is prohibited by
the Brady Act.
    The FBI will not establish a federal firearms registry. The FBI is
expressly barred from doing so by section 103(i) of the Brady Act. In
order to meet her responsibility to maintain the integrity of
Department systems, however, the Attorney General must establish an
adequate system of oversight and review. Consequently, the FBI has
proposed to retain records of approved transactions in an audit log for
a limited period of time solely for the purpose of satisfying the
statutory requirement of ensuring the privacy and security of the NICS
and the proper operation of the system. Although the Brady Act mandates
the destruction of all personally identified information in the NICS
associated with approved firearms transactions (other than the
identifying number and the date the number was assigned), the statute
does not specify a period of time within which records of approvals
must be destroyed. The Department attempted to balance various
interests involved and comply with both statutory requirements by
retaining such records in the NICS Audit Log for a limited, but
sufficient, period of time to conduct audits of the NICS.
    The NICS Audit Log will contain information relating to each NICS
background check requested by FFLs and will allow the FBI to audit use
of the system by FFLs and POCs. By auditing the system, the FBI can
identify instances in which the NICS is used for unauthorized purposes,
such as running checks of people other than actual gun transferees, and
protect against the invasions of privacy that would result from such
misuse. Audits can also determine whether potential handgun purchasers
or FFLs have stolen the identity of innocent and unsuspecting
individuals or otherwise submitted false identification information, in
order to thwart the name check system. The Audit Log will also allow
the FBI to perform quality control checks on the

[[Page 58304]]

system's operation by reviewing the accuracy of the responses given by
the NICS record examiners to gun dealers.
    Under the proposed rule, personally identified information in the
NICS Audit Log associated with allowed transfers would be destroyed
after eighteen months. Because of the numerous comments objecting to
this retention period as too long, the Department reexamined the time
period needed to perform audits of the NICS. In light of the statutory
requirement that records for allowed transfers be destroyed, and the
countervailing statutory requirement to provide for system privacy and
security, the Department determined that the general retention period
for records of allowed transfers in the NICS Audit Log should be the
minimum reasonable period for performing audits on the system, but in
no event more than six months. Section 25.9(b) in the final rule was
revised to reflect this and to provide that such information may be
retained for a longer period if necessary to pursue identified cases of
misuse of the system. The Department further determined that the FBI
shall work toward reducing the retention period to the shortest
practicable period of time less than six months that will allow basic
security audits of the NICS. By February 28, 1999, the Department will
issue a notice of a proposed revision of the regulation setting forth a
further reduced period of retention that will be observed by the
system.
    Various comments expressed concern that the Audit Log would allow
POCs and law enforcement agencies access to records of approved
transfers. This is not a well-founded concern because only the FBI will
be able to access information in the transaction log. Section
25.9(b)(1) of the final rule was revised to provide explicitly that
such information is available only to the FBI, and only for the
purposes of conducting audits of the use and performance of the NICS or
pursing cases of misuse of the system.
    There were also suggestions in the comments that more specific
language be added to the final rule setting forth requirements for the
FBI to ensure that transaction logs of the separate National Crime
Information Center (NCIC) record system also be destroyed to the extent
they reflect allowed firearm transfers. The NCIC information system is
separate from the NICS. Nonetheless, the FBI has taken steps to
preclude transaction logging of personally identified information in
either NCIC or the Interstate Identification Index (III) that would
pertain to allowed firearm transactions. Thus, the only logging of this
information by the FBI is in the NICS Audit Log. Similar steps will be
taken to prevent such logging in the future FBI information systems
NCIC 2000 and the Integrated Automated Fingerprint Identification
System (IAFIS) as soon as practicable, but in no event more than one
year after those systems come on-line in July 1999. For NICS disaster
recovery, a tape of each weekly, full system backup will be maintained
in an off-site location for up to six months. Full system backup tapes
will also be stored locally to recycle the off-site storage. The FBI
keeps no systematic paper copies of transactions.
    Finally, comments were received from state and local law
enforcement agencies that will serve as POCs seeking clarification that
none of the information about NICS checks in state record systems that
they maintain pursuant to state law will be subject to the record
destruction requirement. The proposed rule provided: (1) that POC
records of inquiry and response messages relating to the initiation and
result of a NICS check that allows a transfer must be destroyed; and
(2) that POC records of NICS checks that the POC processes that are
part of a state record system created and maintained in accordance with
state law are not subject to the Brady Act record destruction
requirement. Sections 25.9(d)(1) and (2) of the final rule were revised
to make it clear that the referenced state records of allowed transfers
would not be subject to the Brady Act record destruction requirement if
they are part of a record system created and maintained pursuant to
independent state law regarding firearms transfers. The reason for this
clarification is to avoid interfering with state regulation of
firearms. If a state is performing a gun eligibility check under state
law, and state law requires or allows the retention of the records of
those checks, the state's retention of records of the concurrent
performance of a NICS check would not add any more information about
gun ownership than the state already retains under its own law.

NICS Checks on Pawnshop Redemptions and Gunsmith Transactions

    A significant number of comments on this rule pertained to
conducting background checks on firearms redeemed from pawnshops and
firearms that were the subject of repair or modification by a gunsmith.
Although the Brady Act requires the Attorney General to establish a
national instant criminal background check system, it is the Secretary
of Treasury through the ATF who defines what constitutes a firearms
transfer, how long a background check is valid, which firearm permits
constitute a substitute or alternative to a background check, and the
recordkeeping requirements for FFLs. The ATF has issued proposed
regulations dealing with these issues. (63 FR 8379). Questions and
comments about these matters should be directed to the ATF.
    A number of comments from the pawnbrokers' industry addressed the
circumstances that will develop when a person redeems a firearm from
pawn but the firearm cannot be transferred back to the individual
because of a disqualifying record found by the NICS check. The U.S.
Department of Treasury Fiscal Year 1999 appropriations legislation
includes a provision to allow pawnbrokers the option of requesting a
NICS background check at the time a person offers the firearm for pawn.
An additional check would still be necessary at the time of redemption.
NICS will be made available to pawnbrokers for this purpose. No change
in the rule is necessary to address this.

Use of State Points of Contact

    Some comments questioned the legality of using state POCs to
process NICS checks in light of the Supreme Court's decision in Printz
v. United States, 117 S. Ct. 2365 (1997), which held that Congress
could not compel the states to perform Brady checks. In response to
these comments we note that the states that will act as POCs for the
NICS are not being required to do so by Federal law or regulation, but
will do so voluntarily pursuant to their own state authority. The final
rule's definition of a POC acknowledges that a state or local agency
serving that function will be doing so by express or implied authority
pursuant to state statute or executive order.
    Some commenters objected to the use of state or local law
enforcement agencies as NICS POCs even if such agencies do so
voluntarily. The FBI considers the use of POCs (serving as
intermediaries between FFLs and the system) to be an appropriate means
to implement the Brady Act. Fostering state and local participation in
the NICS is entirely consistent with both our federal form of
government and with practices under the Brady Act's interim provision.
Moreover, state and local authorities are likely to have readier access
to more detailed information than a single centralized processor, such
as the FBI, thus resulting in fewer system misses of disqualified
persons and enhancing system responsiveness

[[Page 58305]]

for non-disqualified persons. The final rule therefore retains the POC
provisions of the proposed rule.

Other Comments

    Other comments addressed matters that were established by the Brady
Act and are not subject to change by regulation, or addressed matters
over which the Attorney General has no authority under the Brady Act.
Accordingly, no changes were made to this final rule for comments such
as the following: long guns should be exempted from background checks;
a government-issued photo identification should not be required for
transferee identification; disqualifying information should be included
on a person's drivers license to make a NICS check unnecessary; there
should be no immunity from liability for persons or agencies providing
information to the NICS; the Attorney General should not be permitted
to obtain information relevant to NICS determinations from other
federal agencies; and FFLs should be able to transfer a firearm sooner
than the expiration of three business days in the absence of a NICS
response.
    Some comments also objected to the use of a NICS ``Delayed''
response, arguing that the Brady Act only provides for approval and
denial responses. We note that the ``Delayed'' response is merely a way
of communicating to the FFL that the system requires additional time to
research and evaluate whether the prospective transferee is
disqualified from receiving a firearm. The definition of the
``Delayed'' response in the final rule was revised to reflect this and
the fact that a ``Delayed'' response indicates that it would be
unlawful to transfer the firearm pending receipt of a follow-up
``Proceed'' response from the NICS or the expiration of three business
days, whichever occurs first. The law does not prohibit the system from
making such a response.
    Some comments objected to solicitation and retention of a
prospective transferee's Social Security number (SSN). As noted in the
proposed rule, a prospective transferee is free not to provide his or
her SSN and will not be denied NICS processing for failure to do so.
However, voluntarily providing his or her SSN can benefit a prospective
transferee by helping NICS differentiate the prospective transferee
from other persons with similar names who may have disqualifying
records. Moreover, the SSNs of non-disqualified transferees will be
destroyed with the rest of the transferees' identifying data at the end
of 180 days. The final rule therefore retains this provision of the
proposed rule.
    At least one comment asked about the system's handling of persons
who have been granted relief from disabilities and the safeguards to
ensure this relief is recognized by the NICS. Initially, the NICS will
not contain records on persons granted relief from firearm disabilities
by the ATF. A procedure will be implemented, however, so that the NICS
Operations Center can verify the status of such individuals when they
wish to obtain a firearm. The ATF has agreed to notify the FBI if and
when it grants relief from disabilities in the future by providing the
individuals' names and FBI identification numbers for inclusion in its
records. This matter will also be the subject of discussion with state
law enforcement agencies that include or should include information in
their record systems about relief granted to persons under state
statute.
    A small number of comments suggested that the FBI establish its
regular business hours beginning at 8:00 a.m. in the earlier time zones
and/or requiring POCs to offer hours of 9:00 a.m. to 10:00 p.m. The
final rule retains the FBI business hours of 9:00 a.m. to 2:00 a.m. It
is understood that some places of business are open during hours during
which the NICS Operations Center is unavailable. However, the FBI is
servicing retail stores in seven different time zones and has attempted
to define its business hours to cover the peak sales times in each
zone. Additionally, in the near future, the FBI will make electronic
access available to FFLs. This access will essentially allow FFLs to
conduct background checks 24 hours a day except during minimal periods
of system maintenance. Guidelines for POCs have been distributed
suggesting minimum business hours of 10:00 a.m. to 9:00 p.m., although
these hours are not mandatory.
    A number of law enforcement officials noted that the proposed rule
would not allow a law enforcement officer to check the NICS for the
status of a person in possession of a firearm to help investigate
whether the person is unlawfully in possession. The proposed rule also
would not allow checks for general law enforcement purposes. The final
rule remains unchanged in this regard largely due to privacy-related
concerns expressed by the federal agencies supplying records to the
NICS Index. Taking into account that the Brady Act expressly requires
agencies to provide records to the NICS for Brady Act purposes, the
agencies were concerned that use for other purposes would conflict with
privacy statutes that restrict the use of such information. The FBI
notes that law enforcement has access to the vast majority of records
available to the NICS through the National Crime Information Center
(NCIC) or the Interstate Identification Index (III).
    A number of state officials who will be acting as POCs in their
states commented that they verify the identity of the FFLs by means
other than the FFL number assigned by the ATF. They further commented
that they may provide a state number rather than a NICS system
transaction number to the FFLs for approved sales. They may not provide
a number for a denied sale. Section 25.6(d), (g), and (i) were changed
to accommodate the state systems.
    Several comments expressed the desire for the FBI to have both
telephone and electronic dial-up access fully available for background
checks when the NICS becomes available November 30, 1998. The FBI also
would like to have electronic access fully deployed as soon as possible
since the electronic access improves service and reduces the number of
people needed to operate the system. Since the Brady Act requires
telephone access at a minimum, the NICS system developers have focused
resources to make sure that the basic system would be operational on
schedule. It now appears that electronic dial-up access will become
available to FFLs sometime after November 30, 1998. Therefore, section
25.6(b) was changed accordingly. This section was changed further to
make it clear that there may be periods within a 24-hour day when NICS
would be unavailable due to scheduled or unscheduled downtime. As soon
as the NICS is proven to have fully successful operating capability
using telephone access, all available resources will be directed toward
the additional electronic access. The development time for this
capability should be relatively short because prototypes are already
complete.
    Some comments suggested that the FBI provide a toll-free telephone
number to individuals who are denied the transfer of a firearm and wish
to appeal this denial, and that the FBI establish in the final rule a
time frame within which the FBI and POCs would have to respond to an
appeal. The FBI will provide a toll-free number for this purpose. In
most cases, however, a written appeal will be required to get the
appeal process started. No time frame for answering appeals was
included in this rule since the Brady Act specifically provides that
the NICS will respond within five business days

[[Page 58306]]

to individuals requesting the reasons for being found ineligible to
receive a firearm, and that the system immediately consider an
individual's submission to correct, clarify, or supplement records in
the NICS.
    In response to comments about FFL access to the NICS, section
25.6(b) was modified to clarify that the FBI intends to provide FFLs a
toll-free number for both telephone and electronic dial-up access.

Technical Changes

    The term ``password'' used in the proposed rule has been changed to
``code word'' in the final rule. The term ``password'' has a specific
meaning and implications when used in the context of computer security.
The ``code word'' selected by the FFL when enrolling with the FBI to
gain access to the NICS does not comply with all the security measures
normally associated with a ``password.'' Therefore, to avoid creating a
false impression, the term ``password'' has been replaced by ``code
word.''
    In the final rule, words such as ``purchase'' and ``purchaser''
were changed to words such as ``obtain'' and ``transferee'' to clarify
that NICS checks apply to transfers and are not limited to firearm
sales.
    The definition of the term ``Proceed'' was modified in the final
rule to clarify that it means that information available to the system
at the time of the response did not demonstrate that transfer of the
firearm would violate Federal or state law and that, notwithstanding a
``Proceed'' response from the NICS, an FFL may not lawfully transfer a
firearm if he or she knows or has reasonable cause to believe that the
prospective transferee is prohibited from receiving or possessing
firearms, or is otherwise prohibited from transferring the firearm
under applicable Federal or state law.
    The proposed rule provided that a denial by the NICS of a firearm
transfer would be based upon one or more matching records that provide
reason to believe that receipt of a firearm by a prospective transferee
would violate 18 U.S.C. 922 or state law. The final rule changes the
terminology relating to NICS denials to ``information demonstrating''
rather than ``reason to believe'' in order to conform the language of
the regulation more closely to the language relating to denials in the
Brady Act.
    Section 25.6(a) in the final rule was modified to indicate that the
ATF will advise FFLs whether they are required to contact the FBI or a
POC to initiate a NICS check and how they are to do so. Section 25.6(j)
was modified to clarify the allowable non-Brady Act uses of the NICS
Index to include responding to inquiries by criminal justice agencies
in connection with licenses or permits to carry a concealed firearm or
to import, manufacture, deal in, or purchase explosives, and inquiries
by the ATF in connection with enforcement of the Gun Control Act (18
U.S.C. Chapter 44), or the National Firearms Act (26 U.S.C. Chapter
53). Section 25.8(b) was modified to indicate that the states will not
be required to give the FBI a list of the Originating Agency
Identifiers (ORIs) for POCs within the state. Section 25.8(i) was
modified to correctly identify the documents where security
requirements are outlined. Section 25.9(a) was modified to clarify that
in cases of firearms disabilities that are not permanent, e.g.,
disqualifying restraining orders, the NICS will automatically purge the
pertinent record when it is no longer disqualifying. Section 25.10(a)
was modified to allow states to accept denial appeals in other than
written form.

Applicable Administrative Procedures and Executive Orders

Regulatory Flexibility Analysis

    The Attorney General, in accordance with the Regulatory Flexibility
Act (5 U.S.C. 605(b)), has reviewed this final regulation and by
approving it certifies that this regulation will not have a significant
economic impact on a substantial number of small entities. A Brady Act
Task Group, composed of experienced state and local law enforcement
officials, provided input on the design of the NICS. When developing
the guidelines for the NICS, both the Task Group and the FBI took into
account the fact that many FFLs are small businesses. A small firearm
retailer is defined as having under $5.0 million in annual gross
receipts as defined by 13 CFR 121.201. Firearm retailers are included
in the Standard Industrial Class (SIC) Code 5941. The FBI has further
considered that this rule will apply to pawn redemptions, and that many
pawnbrokers are small entities. The obligation of FFLs to contact the
NICS before transferring a firearm, and the applicability of NICS
checks to pawn redemptions, are imposed by the Brady Act and detailed
in the proposed ATF regulations implementing the permanent provisions
of the Brady Act (63 FR 8379). In designing the NICS, the FBI has
sought to avoid burdens on small entities beyond those requirements
needed to conduct the statutorily prescribed background checks
effectively and to ensure the privacy and security of the information
in the NICS. The FBI is not aware of any relevant Federal rules that
duplicate, overlap, or conflict with this rule.
    The FBI has sent a notice, including a letter describing NICS and a
NICS brochure, to each FFL in the states and territories that are
currently expected to be serviced directly by the FBI. The FBI has also
met with FFLs at regional firearm seminars conducted by ATF to inform
FFLs about NICS plans and to solicit comments needed to finalize these
plans. These efforts were made by the FBI also to satisfy the
``outreach'' provisions of 5 U.S.C. 609.

Executive Order 12866

    The Department of Justice has completed its examination of this
final rule in light of Executive Order 12866, section 1(b), Principles
of Regulation. The Department of Justice has determined that this final
rule is a ``significant regulatory action'' under section 3(f) of
Executive Order 12866, Regulatory Planning and Review, and thus it has
been reviewed by the Office of Management and Budget (OMB).

Executive Order 12612

    This final rule will not have a substantial direct effect on the
states, on the relationship between the national government and the
states, or on the distribution of power and responsibilities among the
various levels of government. Therefore, in accordance with Executive
Order 12612, it is determined that this rule does not have sufficient
federalism implications to warrant the preparation of a Federal
Assessment.

Unfunded Mandates Reform Act of 1995

    This final rule will not result in the expenditure by state, local,
and tribal governments, in the aggregate, or by the private sector, of
$100,000,000 or more in any one year, and it will not significantly or
uniquely affect small governments. Therefore, no actions were deemed
necessary under the provisions of the Unfunded Mandates Reform Act of
1995.

Small Business Regulatory Enforcement Fairness Act of 1996

    This final rule is not a major rule as defined by the Small
Business Regulatory Enforcement Fairness Act of 1996. 5 U.S.C. 804.
This rule will not result in an annual effect on the economy of
$100,000,000 or more, a major increase in costs or prices, or have
significant adverse effects on competition, employment, investment,
productivity, innovation, or on the

[[Page 58307]]

ability of United States-based companies to compete with foreign-based
companies in domestic and export markets.

Paperwork Reduction Act of 1995

    The collection of information contained in this final rule has been
submitted to OMB for review in accordance with the Paperwork Reduction
Act of 1995 (44 U.S.C. 3507(d)). Public comment was solicited in the
notice of proposed rulemaking that preceded this final rule (63 FR
30430). In addition, three data collection activities deemed necessary
for the implementation of the NICS were the subject of separate
publications.
    On May 31, 1998, the FBI submitted a Paperwork Reduction Act
request for emergency OMB review and clearance of a proposed data
collection entitled the NICS Firearm Dealers Survey. On June 1, 1998,
the FBI published a Federal Register notice (63 FR 29755) announcing
its intention to collect this information. On June 21, 1998, the OMB
granted approval for the data collection effort, and issued OMB control
number 1110-0025 for inclusion on the data collection instrument. This
control number allows the FBI to collect survey data for 180 days from
the date of issue. The FBI published a second notice in the Federal
Register (63 FR 44925) on August 21, 1998, requesting OMB approval to
collect this data for a period of up to three years.
    On July 16, 1998, the FBI submitted a Paperwork Reduction Act
request for emergency OMB review and clearance of a proposed data
collection entitled the NICS Federal Firearms Licensee (FFL) Enrollment
Form. On July 23, 1998, the FBI published a Federal Register notice (63
FR 39594) announcing its intention to collect this information. On
August 3, 1998, OMB granted approval for the data collection effort,
and issued OMB control number 1110-0026 for inclusion on the data
collection instrument. This control number allows the FBI to collect
enrollment information for 180 days from the date of issue. The FBI
will publish a second notice in the Federal Register requesting OMB
approval to collect this data for a period of up to three years.
    On July 27, 1998, the FBI submitted a Paperwork Reduction Act
request for emergency OMB review and clearance of a proposed data
collection entitled the FFL Execution of Acknowledgment of Obligations
and Responsibilities Under the NICS. On August 3, 1998, the FBI
published a Federal Register notice (63 FR 41296) announcing its
intention to collect this information. On August 3, 1998, the OMB
granted approval for the data collection effort, and issued OMB control
number 1110-0027 for inclusion on the data collection instrument. This
control number allows the FBI to collect this information for 180 days
from the date of issue. The FBI will publish a second notice in the
Federal Register requesting OMB approval to collect this data for a
period of up to three years.

List of Subjects in 28 CFR Part 25

    Administrative practice and procedure, Business and industry,
Computer technology, Courts, Firearms, Law enforcement officers,
Penalties, Privacy, Reporting and recordkeeping requirements, Security
measures, Telecommunications.
    Accordingly, chapter I of title 28 of the Code of Federal
Regulations is amended by adding part 25 to read as follows:

PART 25--DEPARTMENT OF JUSTICE INFORMATION SYSTEMS

Subpart A--The National Instant Criminal Background Check System

Sec.
25.1  Purpose and authority.
25.2  Definitions.
25.3  System information.
25.4  Record source categories.
25.5  Validation and data integrity of records in the system.
25.6  Accessing records in the system.
25.7  Querying records in the system.
25.8  System safeguards.
25.9  Retention and destruction of records in the system.
25.10  Correction of erroneous system information.
25.11  Prohibited activities and penalties.

    Authority: Pub. L. 103-159, 107 Stat. 1536.

Subpart A--The National Instant Criminal Background Check System

Sec. 25.1  Purpose and authority.

    The purpose of this subpart is to establish policies and procedures
implementing the Brady Handgun Violence Prevention Act (Brady Act),
Public Law 103-159, 107 Stat. 1536. The Brady Act requires the Attorney
General to establish a National Instant Criminal Background Check
System (NICS) to be contacted by any licensed importer, licensed
manufacturer, or licensed dealer of firearms for information as to
whether the transfer of a firearm to any person who is not licensed
under 18 U.S.C. 923 would be in violation of Federal or state law. The
regulations in this subpart are issued pursuant to section 103(h) of
the Brady Act, 107 Stat. 1542 (18 U.S.C. 922 note), and include
requirements to ensure the privacy and security of the NICS and appeals
procedures for persons who have been denied the right to obtain a
firearm as a result of a NICS background check performed by the Federal
Bureau of Investigation (FBI) or a state or local law enforcement
agency.

Sec. 25.2  Definitions.

    Appeal means a formal procedure to challenge the denial of a
firearm transfer.
    ARI means a unique Agency Record Identifier assigned by the agency
submitting records for inclusion in the NICS Index.
    ATF means the Bureau of Alcohol, Tobacco, and Firearms of the
Department of Treasury.
    Audit log means a chronological record of system (computer)
activities that enables the reconstruction and examination of the
sequence of events and/or changes in an event.
    Business day means a 24-hour day (beginning at 12:01 a.m.) on which
state offices are open in the state in which the proposed firearm
transaction is to take place.
    Control Terminal Agency means a state or territorial criminal
justice agency recognized by the FBI as the agency responsible for
providing state-or territory-wide service to criminal justice users of
NCIC data.
    Data source means an agency that provided specific information to
the NICS.
    Delayed means that more research is required prior to a NICS
``Proceed'' or ``Denied'' response. A ``Delayed'' response to the FFL
indicates that it would be unlawful to transfer the firearm until
receipt of a follow-up ``Proceed'' response from the NICS or the
expiration of three business days, whichever occurs first.
    Denied means denial of a firearm transfer based on a NICS response
indicating one or more matching records were found providing
information demonstrating that receipt of a firearm by a prospective
transferee would violate 18 U.S.C. 922 or state law.
    Denying agency means a POC or the NICS Operations Center, whichever
determines that information in the NICS indicates that the transfer of
a firearm to a person would violate Federal or state law, based on a
background check.
    Dial-up access means any routine access through commercial switched
circuits on a continuous or temporary basis.
    Federal agency means any authority of the United States that is an
``Agency'' under 44 U.S.C. 3502(1), other than those considered to be
independent regulatory agencies, as defined in 44 U.S.C. 3502(10).
    FFL (federal firearms licensee) means a person licensed by the ATF
as a

[[Page 58308]]

manufacturer, dealer, or importer of firearms.
    Firearm has the same meaning as in 18 U.S.C. 921(a)(3).
    Licensed dealer means any person defined in 27 CFR 178.11.
    Licensed importer has the same meaning as in 27 CFR 178.11.
    Licensed manufacturer has the same meaning as in 27 CFR 178.11.
    NCIC (National Crime Information Center) means the nationwide
computerized information system of criminal justice data established by
the FBI as a service to local, state, and Federal criminal justice
agencies.
    NICS means the National Instant Criminal Background Check System,
which an FFL must, with limited exceptions, contact for information on
whether receipt of a firearm by a person who is not licensed under 18
U.S.C. 923 would violate Federal or state law.
    NICS Index means the database, to be managed by the FBI, containing
information provided by Federal and state agencies about persons
prohibited under Federal law from receiving or possessing a firearm.
The NICS Index is separate and apart from the NCIC and the Interstate
Identification Index (III).
    NICS Operations Center means the unit of the FBI that receives
telephone or electronic inquiries from FFLs to perform background
checks, makes a determination based upon available information as to
whether the receipt or transfer of a firearm would be in violation of
Federal or state law, researches criminal history records, tracks and
finalizes appeals, and conducts audits of system use.
    NICS Operations Center's regular business hours means the hours of
9:00 a.m. to 2:00 a.m., Eastern Time, seven days a week.
    NICS Representative means a person who receives telephone inquiries
to the NICS Operations Center from FFLs requesting background checks
and provides a response as to whether the receipt or transfer of a
firearm may proceed or is delayed.
    NRI (NICS Record Identifier) means the system-generated unique
number associated with each record in the NICS Index.
    NTN (NICS Transaction Number) means the unique number that will be
assigned to each valid background check inquiry received by the NICS.
Its primary purpose will be to provide a means of associating inquiries
to the NICS with the responses provided by the NICS to the FFLs.
    ORI (Originating Agency Identifier) means a nine-character
identifier assigned by the FBI to an agency that has met the
established qualifying criteria for ORI assignment to identify the
agency in transactions on the NCIC System.
    Originating Agency means an agency that provides a record to a
database checked by the NICS.
    POC (Point of Contact) means a state or local law enforcement
agency serving as an intermediary between an FFL and the federal
databases checked by the NICS. A POC will receive NICS background check
requests from FFLs, check state or local record systems, perform NICS
inquiries, determine whether matching records provide information
demonstrating that an individual is disqualified from possessing a
firearm under Federal or state law, and respond to FFLs with the
results of a NICS background check. A POC will be an agency with
express or implied authority to perform POC duties pursuant to state
statute, regulation, or executive order.
    Proceed means a NICS response indicating that the information
available to the system at the time of the response did not demonstrate
that transfer of the firearm would violate federal or state law. A
``Proceed'' response would not relieve an FFL from compliance with
other provisions of Federal or state law that may be applicable to
firearms transfers. For example, under 18 U.S.C. 922(d), an FFL may not
lawfully transfer a firearm if he or she knows or has reasonable cause
to believe that the prospective recipient is prohibited by law from
receiving or possessing a firearm.
    Record means any item, collection, or grouping of information about
an individual that is maintained by an agency, including but not
limited to information that disqualifies the individual from receiving
a firearm, and that contains his or her name or other personal
identifiers.
    STN (State-Assigned Transaction Number) means a unique number that
may be assigned by a POC to a valid background check inquiry.
    System means the National Instant Criminal Background Check System
(NICS).

Sec. 25.3  System information.

    (a) There is established at the FBI a National Instant Criminal
Background Check System.
    (b) The system will be based at the Federal Bureau of
Investigation, 1000 Custer Hollow Road, Clarksburg, West Virginia
26306-0147.
    (c) The system manager and address are: Director, Federal Bureau of
Investigation, J. Edgar Hoover F.B.I. Building, 935 Pennsylvania
Avenue, NW, Washington, D.C. 20535.

Sec. 25.4  Record source categories.

    It is anticipated that most records in the NICS Index will be
obtained from Federal agencies. It is also anticipated that a limited
number of authorized state and local law enforcement agencies will
voluntarily contribute records to the NICS Index. Information in the
NCIC and III systems that will be searched during a background check
has been or will be contributed voluntarily by Federal, state, local,
and international criminal justice agencies.

Sec. 25.5  Validation and data integrity of records in the system.

    (a) The FBI will be responsible for maintaining data integrity
during all NICS operations that are managed and carried out by the FBI.
This responsibility includes:
    (1) Ensuring the accurate adding, canceling, or modifying of NICS
Index records supplied by Federal agencies;
    (2) Automatically rejecting any attempted entry of records into the
NICS Index that contain detectable invalid data elements;
    (3) Automatic purging of records in the NICS Index after they are
on file for a prescribed period of time; and
    (4) Quality control checks in the form of periodic internal audits
by FBI personnel to verify that the information provided to the NICS
Index remains valid and correct.
    (b) Each data source will be responsible for ensuring the accuracy
and validity of the data it provides to the NICS Index and will
immediately correct any record determined to be invalid or incorrect.

Sec. 25.6  Accessing records in the system.

    (a) FFLs may initiate a NICS background check only in connection
with a proposed firearm transfer as required by the Brady Act. FFLs are
strictly prohibited from initiating a NICS background check for any
other purpose. The process of accessing the NICS for the purpose of
conducting a NICS background check is initiated by an FFL's contacting
the FBI NICS Operations Center (by telephone or electronic dial-up
access) or a POC. FFLs in each state will be advised by the ATF whether
they are required to initiate NICS background checks with the NICS
Operations Center or a POC and how they are to do so.
    (b) Access to the NICS through the FBI NICS Operations Center. FFLs
may contact the NICS Operations Center by use of a toll-free telephone
number, only during its regular business hours. In addition to
telephone access, toll-free electronic dial-up access to the NICS will
be provided to FFLs after the

[[Page 58309]]

beginning of the NICS operation. FFLs with electronic dial-up access
will be able to contact the NICS 24 hours each day, excluding scheduled
and unscheduled downtime.
    (c)(1) The FBI NICS Operations Center, upon receiving an FFL
telephone or electronic dial-up request for a background check, will:
    (i) Verify the FFL Number and code word;
    (ii) Assign a NICS Transaction Number (NTN) to a valid inquiry and
provide the NTN to the FFL;
    (iii) Search the relevant databases (i.e., NICS Index, NCIC, III)
for any matching records; and
    (iv) Provide the following NICS responses based upon the
consolidated NICS search results to the FFL that requested the
background check:
    (A) ``Proceed'' response, if no disqualifying information was found
in the NICS Index, NCIC, or III.
    (B) ``Delayed'' response, if the NICS search finds a record that
requires more research to determine whether the prospective transferee
is disqualified from possessing a firearm by Federal or state law. A
``Delayed'' response to the FFL indicates that the firearm transfer
should not proceed pending receipt of a follow-up ``Proceed'' response
from the NICS or the expiration of three business days (exclusive of
the day on which the query is made), whichever occurs first. (Example:
An FFL requests a NICS check on a prospective firearm transferee at
9:00 a.m. on Friday and shortly thereafter receives a ``Delayed''
response from the NICS. If state offices in the state in which the FFL
is located are closed on Saturday and Sunday and open the following
Monday, Tuesday, and Wednesday, and the NICS has not yet responded with
a ``Proceed'' or ``Denied'' response, the FFL may transfer the firearm
at 12:01 a.m. Thursday.)
    (C) ``Denied'' response, when at least one matching record is found
in either the NICS Index, NCIC, or III that provides information
demonstrating that receipt of a firearm by the prospective transferee
would violate 18 U.S.C. 922 or state law. The ``Denied'' response will
be provided to the requesting FFL by the NICS Operations Center during
its regular business hours.
    (2) None of the responses provided to the FFL under paragraph
(c)(1) of this section will contain any of the underlying information
in the records checked by the system.
    (d) Access to the NICS through POCs. In states where a POC is
designated to process background checks for the NICS, FFLs will contact
the POC to initiate a NICS background check. Both ATF and the POC will
notify FFLs in the POC's state of the means by which FFLs can contact
the POC. The NICS will provide POCs with electronic access to the
system virtually 24 hours each day through the NCIC communication
network. Upon receiving a request for a background check from an FFL, a
POC will:
    (1) Verify the eligibility of the FFL either by verification of the
FFL number or an alternative POC-verification system;
    (2) Enter a purpose code indicating that the query of the system is
for the purpose of performing a NICS background check in connection
with the transfer of a firearm; and (3) Transmit the request for a
background check via the NCIC interface to the NICS.
    (e) Upon receiving a request for a NICS background check, POCs may
also conduct a search of available files in state and local law
enforcement and other relevant record systems, and may provide a unique
State-Assigned Transaction Number (STN) to a valid inquiry for a
background check.
    (f) When the NICS receives an inquiry from a POC, it will search
the relevant databases (i.e., NICS Index, NCIC, III) for any matching
record(s) and will provide an electronic response to the POC. This
response will consolidate the search results of the relevant databases
and will include the NTN. The following types of responses may be
provided by the NICS to a state or local agency conducting a background
check:
    (1) No record response, if the NICS determines, through a complete
search, that no matching record exists.
    (2) Partial response, if the NICS has not completed the search of
all of its records. This response will indicate the databases that have
been searched (i.e., III, NCIC, and/or NICS Index) and the databases
that have not been searched. It will also provide any potentially
disqualifying information found in any of the databases searched. A
follow-up response will be sent as soon as all the relevant databases
have been searched. The follow-up response will provide the complete
search results.
    (3) Single matching record response, if all records in the relevant
databases have been searched and one matching record was found.
    (4) Multiple matching record response, if all records in the
relevant databases have been searched and more than one matching record
was found.
    (g) Generally, based on the response(s) provided by the NICS, and
other information available in the state and local record systems, a
POC will:
    (1) Confirm any matching records; and
    (2) Notify the FFL that the transfer may proceed, is delayed
pending further record analysis, or is denied. ``Proceed''
notifications made within three business days will be accompanied by
the NTN or STN traceable to the NTN. The POC may or may not provide a
transaction number (NTN or STN) when notifying the FFL of a ``Denied''
response.
    (h) In cases where a transfer is denied by a POC, the POC should
provide a denial notification to the NICS. This denial notification
will include the name of the person who was denied a firearm and the
NTN. The information provided in the denial notification will be
maintained in the NICS Audit Log described in Sec. 25.9(b). This
notification may be provided immediately by electronic message to the
NICS (i.e., at the time the transfer is denied) or as soon thereafter
as possible. If a denial notification is not provided by a POC, the
NICS will assume that the transfer was allowed and will destroy its
records regarding the transfer in accordance with the procedures
detailed in Sec. 25.9.
    (i) Response recording. FFLs are required to record the system
response, whether provided by the FBI NICS Operations Center or a POC,
on the appropriate ATF form for audit and inspection purposes, under 27
CFR part 178 recordkeeping requirements. The FBI NICS Operations Center
response will always include an NTN and associated ``Proceed,''
``Delayed,'' or ``Denied'' determination. POC responses may vary as
discussed in paragraph (g) of this section. In these instances, FFLs
will record the POC response, including any transaction number and/or
determination.
    (j) Access to the NICS Index for purposes unrelated to NICS
background checks required by the Brady Act. Access to the NICS Index
for purposes unrelated to NICS background checks pursuant to 18 U.S.C.
922(t) shall be limited to uses for the purpose of:
    (1) Providing information to Federal, state, or local criminal
justice agencies in connection with the issuance of a firearm-related
or explosives-related permit or license, including permits or licenses
to possess, acquire, or transfer a firearm, or to carry a concealed
firearm, or to import, manufacture, deal in, or purchase explosives; or
    (2) Responding to an inquiry from the ATF in connection with a
civil or criminal law enforcement activity relating to the Gun Control
Act (18 U.S.C. Chapter 44) or the National Firearms Act (26 U.S.C.
Chapter 53).

[[Page 58310]]

Sec. 25.7  Querying records in the system.

    (a) The following search descriptors will be required in all
queries of the system for purposes of a background check:
    (1) Name;
    (2) Sex;
    (3) Race;
    (4) Complete date of birth; and
    (5) State of residence.
    (b) A unique numeric identifier may also be provided to search for
additional records based on exact matches by the numeric identifier.
Examples of unique numeric identifiers for purposes of this system are:
Social Security number (to comply with Privacy Act requirements, a
Social Security number will not be required by the NICS to perform any
background check) and miscellaneous identifying numbers (e.g., military
number or number assigned by Federal, state, or local authorities to an
individual's record). Additional identifiers that may be requested by
the system after an initial query include height, weight, eye and hair
color, and place of birth. At the option of the querying agency, these
additional identifiers may also be included in the initial query of the
system.

Sec. 25.8  System safeguards.

    (a) Information maintained in the NICS Index is stored
electronically for use in an FBI computer environment. The NICS central
computer will reside inside a locked room within a secure facility.
Access to the facility will be restricted to authorized personnel who
have identified themselves and their need for access to a system
security officer.
    (b) Access to data stored in the NICS is restricted to duly
authorized agencies. The security measures listed in paragraphs (c)
through (f) of this section are the minimum to be adopted by all POCs
and data sources having access to the NICS.
    (c) State or local law enforcement agency computer centers
designated by a Control Terminal Agency as POCs shall be authorized
NCIC users and shall observe all procedures set forth in the NCIC
Security Policy of 1992 when processing NICS background checks. The
responsibilities of the Control Terminal Agencies and the computer
centers include the following:
    (1) The criminal justice agency computer site must have adequate
physical security to protect against any unauthorized personnel gaining
access to the computer equipment or to any of the stored data.
    (2) Since personnel at these computer centers can have access to
data stored in the NICS, they must be screened thoroughly under the
authority and supervision of a state Control Terminal Agency. This
authority and supervision may be delegated to responsible criminal
justice agency personnel in the case of a satellite computer center
being serviced through a state Control Terminal Agency. This screening
will also apply to non-criminal justice maintenance or technical
personnel.
    (3) All visitors to these computer centers must be accompanied by
staff personnel at all times.
    (4) POCs utilizing a state/NCIC terminal to access the NICS must
have the proper computer instructions written and other built-in
controls to prevent data from being accessible to any terminals other
than authorized terminals.
    (5) Each state Control Terminal Agency shall build its data system
around a central computer, through which each inquiry must pass for
screening and verification.
    (d) Authorized state agency remote terminal devices operated by
POCs and having access to the NICS must meet the following
requirements:
    (1) POCs and data sources having terminals with access to the NICS
must physically place these terminals in secure locations within the
authorized agency;
    (2) The agencies having terminals with access to the NICS must
screen terminal operators and must restrict access to the terminals to
a minimum number of authorized employees; and
    (3) Copies of NICS data obtained from terminal devices must be
afforded appropriate security to prevent any unauthorized access or
use.
    (e) FFL remote terminal devices may be used to transmit queries to
the NICS via electronic dial-up access. The following procedures will
apply to such queries:
    (1) The NICS will incorporate a security authentication mechanism
that performs FFL dial-up user authentication before network access
takes place;
    (2) The proper use of dial-up circuits by FFLs will be included as
part of the periodic audits by the FBI; and
    (3) All failed authentications will be logged by the NICS and
provided to the NICS security administrator.
    (f) FFLs may use the telephone to transmit queries to the NICS, in
accordance with the following procedures:
    (1) FFLs may contact the NICS Operations Center during its regular
business hours by a telephone number provided by the FBI;
    (2) FFLs will provide the NICS Representative with their FFL Number
and code word, the type of sale, and the name, sex, race, date of
birth, and state of residence of the prospective buyer; and
    (3) The NICS will verify the FFL Number and code word before
processing the request.
    (g) The following precautions will be taken to help ensure the
security and privacy of NICS information when FFLs contact the NICS
Operations Center:
    (1) Access will be restricted to the initiation of a NICS
background check in connection with the proposed transfer of a firearm.
    (2) The NICS Representative will only provide a response of
``Proceed'' or ``Delayed'' (with regard to the prospective firearms
transfer), and will not provide the details of any record information
about the transferee. In cases where potentially disqualifying
information is found in response to an FFL query, the NICS
Representative will provide a ``Delayed'' response to the FFL. Follow-
up ``Proceed'' or ``Denied'' responses will be provided by the NICS
Operations Center during its regular business hours.
    (3) The FBI will periodically monitor telephone inquiries to ensure
proper use of the system.
    (h) All transactions and messages sent and received through
electronic access by POCs and FFLs will be automatically logged in the
NICS Audit Log described in Sec. 25.9(b). Information in the NICS Audit
Log will include initiation and termination messages, failed
authentications, and matching records located by each search
transaction.
    (i) The FBI will monitor and enforce compliance by NICS users with
the applicable system security requirements outlined in the NICS POC
Guidelines and the NICS FFL Manual (available from the NICS Operations
Center, Federal Bureau of Investigation, 1000 Custer Hollow Road,
Clarksburg, West Virginia 26306-0147).

Sec. 25.9  Retention and destruction of records in the system.

    (a) The NICS will retain NICS Index records that indicate that
receipt of a firearm by the individuals to whom the records pertain
would violate Federal or state law. The NICS will retain such records
indefinitely, unless they are canceled by the originating agency. In
cases where a firearms disability is not permanent, e.g., a
disqualifying restraining order, the NICS will automatically purge the
pertinent record when it is no longer disqualifying. Unless otherwise
removed, records contained in the NCIC and III files that are accessed
during a background check

[[Page 58311]]

will remain in those files in accordance with established policy.
    (b) The FBI will maintain an automated NICS Audit Log of all
incoming and outgoing transactions that pass through the system.
    (1) The Audit Log will record the following information: type of
transaction (inquiry or response), line number, time, date of inquiry,
header, message key, ORI, and inquiry/response data (including the name
and other identifying information about the prospective transferee and
the NTN). In cases of allowed transfers, all information in the Audit
Log related to the person or the transfer, other than the NTN assigned
to the transfer and the date the number was assigned, will be destroyed
after not more than six months after the transfer is allowed. Audit Log
records relating to denials will be retained for 10 years, after which
time they will be transferred to a Federal Records Center for storage.
The NICS will not be used to establish any system for the registration
of firearms, firearm owners, or firearm transactions or dispositions,
except with respect to persons prohibited from receiving a firearm by
18 U.S.C. 922 (g) or (n) or by state law.
    (2) The Audit Log will be used to analyze system performance,
assist users in resolving operational problems, support the appeals
process, or support audits of the use of the system. Searches may be
conducted on the Audit Log by time frame, i.e., by day or month, or by
a particular state or agency. Information in the Audit Log pertaining
to allowed transfers may only be used by the FBI for the purpose of
conducting audits of the use and performance of the NICS. Such
information, however, may be retained and used as long as needed to
pursue cases of identified misuse of the system. The NICS, including
the NICS Audit Log, may not be used by any department, agency, officer,
or employee of the United States to establish any system for the
registration of firearms, firearm owners, or firearm transactions or
dispositions. The Audit Log will be monitored and reviewed on a regular
basis to detect any possible misuse of the NICS data.
    (c) The following records in the FBI-operated terminals of the NICS
will be subject to the Brady Act's requirements for destruction:
    (1) All inquiry and response messages (regardless of media)
relating to a background check that results in an allowed transfer; and
    (2) All information (regardless of media) contained in the NICS
Audit Log relating to a background check that results in an allowed
transfer.
    (d) The following records of state and local law enforcement units
serving as POCs will be subject to the Brady Act's requirements for
destruction:
    (1) All inquiry and response messages (regardless of media)
relating to the initiation and result of a check of the NICS that
allows a transfer that are not part of a record system created and
maintained pursuant to independent state law regarding firearms
transactions; and
    (2) All other records relating to the person or the transfer
created as a result of a NICS check that are not part of a record
system created and maintained pursuant to independent state law
regarding firearms transactions.

Sec. 25.10  Correction of erroneous system information.

    (a) An individual may request the reason for the denial from the
agency that conducted the check of the NICS (the ``denying agency,''
which will be either the FBI or the state or local law enforcement
agency serving as a POC). The FFL will provide to the denied individual
the name and address of the denying agency and the unique transaction
number (NTN or STN) associated with the NICS background check. The
request for the reason for the denial must be made in writing to the
denying agency. (POCs at their discretion may waive the requirement for
a written request.)
    (b) The denying agency will respond to the individual with the
reasons for the denial within five business days of its receipt of the
individual's request. The response should indicate whether additional
information or documents are required to support an appeal, such as
fingerprints in appeals involving questions of identity (i.e., a claim
that the record in question does not pertain to the individual who was
denied).
    (c) If the individual wishes to challenge the accuracy of the
record upon which the denial is based, or if the individual wishes to
assert that his or her rights to possess a firearm have been restored,
he or she may make application first to the denying agency, i.e.,
either the FBI or the POC. If the denying agency is unable to resolve
the appeal, the denying agency will so notify the individual and shall
provide the name and address of the agency that originated the document
containing the information upon which the denial was based. The
individual may then apply for correction of the record directly to the
agency from which it originated. If the record is corrected as a result
of the appeal to the originating agency, the individual may so notify
the denying agency, which will, in turn, verify the record correction
with the originating agency (assuming the originating agency has not
already notified the denying agency of the correction) and take all
necessary steps to correct the record in the NICS.
    (d) As an alternative to the above procedure where a POC was the
denying agency, the individual may elect to direct his or her challenge
to the accuracy of the record, in writing, to the FBI, NICS Operations
Center, Criminal Justice Information Services Division, 1000 Custer
Hollow Road, Module C-3, Clarksburg, West Virginia 26306-0147. Upon
receipt of the information, the FBI will investigate the matter by
contacting the POC that denied the transaction or the data source. The
FBI will request the POC or the data source to verify that the record
in question pertains to the individual who was denied, or to verify or
correct the challenged record. The FBI will consider the information it
receives from the individual and the response it receives from the POC
or the data source. If the record is corrected as a result of the
challenge, the FBI shall so notify the individual, correct the
erroneous information in the NICS, and give notice of the error to any
Federal department or agency or any state that was the source of such
erroneous records.
    (e) Upon receipt of notice of the correction of a contested record
from the originating agency, the FBI or the agency that contributed the
record shall correct the data in the NICS and the denying agency shall
provide a written confirmation of the correction of the erroneous data
to the individual for presentation to the FFL. If the appeal of a
contested record is successful and thirty (30) days or less have
transpired since the initial check, and there are no other
disqualifying records upon which the denial was based, the NICS will
communicate a ``Proceed'' response to the FFL. If the appeal is
successful and more than thirty (30) days have transpired since the
initial check, the FFL must recheck the NICS before allowing the sale
to continue. In cases where multiple disqualifying records are the
basis for the denial, the individual must pursue a correction for each
record.
    (f) An individual may also contest the accuracy or validity of a
disqualifying record by bringing an action against the state or
political subdivision responsible for providing the contested
information, or responsible for denying the transfer, or against the
United States, as the case may be, for an order directing that the
contested information be corrected or that the firearm transfer be
approved.

[[Page 58312]]

Sec. 25.11  Prohibited activities and penalties.

    (a) State or local agencies, FFLs, or individuals violating this
subpart A shall be subject to a fine not to exceed $10,000 and subject
to cancellation of NICS inquiry privileges.
    (b) Misuse or unauthorized access includes, but is not limited to,
the following:
    (1) State or local agencies', FFLs', or individuals' purposefully
furnishing incorrect information to the system to obtain a ``Proceed''
response, thereby allowing a firearm transfer;
    (2) State or local agencies', FFLs', or individuals' purposefully
using the system to perform a check for unauthorized purposes; and
    (3) Any unauthorized person's accessing the NICS.

    Dated: October 27, 1998.
Janet Reno,
Attorney General.
[FR Doc. 98-29109 Filed 10-29-98; 8:45 am]
BILLING CODE 4410-06-P
