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A West Milwaukee gun shop that sold firearms used to wound Milwaukee police officers and has been a top seller of crime guns is surrendering its license.

But guns will likely continue to be sold from the location now occupied by Badger Guns on S. 43rd St., on the border with Milwaukee.

Details of that new gun-dealing operation are not clear, but one possibility is that the brother of the current owner will pull a fresh license and continue an operation with a new name - legal under laws written by Congress that can protect stores that have violations.

Badger Guns owner Adam Allan said Tuesday he is giving up his license after losing a yearlong battle with the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives to renew it.

Allan said the agency will let him sell guns until the end of the year. Allan can then take any remaining guns and transfer them in his "personal collection" and sell them at gun shows without doing background checks - a loophole put in place by Congress and upheld by courts. In some instances, the agency tries to avoid such scenarios by requiring revoked gun dealers to sell remaining inventory to another licensed dealer.

Allan said he has made no such deal with ATF.

"Whatever I can't sell here, I will sell somewhere else," Allan said Tuesday, as he dealt with a crush of gun buyers flooding the store on news he was giving up his license.

ATF spokesman Robert Schmidt said he could not comment on the situation at Badger Guns.

Allan said he will continue to work in the store, running the shooting range and selling ammunition and accessories, none of which require a federal license.

At least four people have expressed interest in selling guns from that location, according to Allan. He said he did not know if one of those people was his brother, Michael Allan, who currently works in the store. Asked if he was taking out a license late Tuesday, Michael Allan said, "No comment on that yet."

In response to Adam Allan's comment that he is getting out of the gun-selling business, Milwaukee Police Chief Edward Flynn issued the statement: "I'll believe it when I see it."

A statement from Milwaukee Mayor Tom Barrett read: "My concern continues to be making sure retailers do not sell guns to people who are not legally allowed to possess them. We will continue to closely monitor the operation of Badger and other gun stores."

The legalities

By law, ATF cannot block issuing a gun-dealing license unless it can prove that the arrangement is a sham and the previous owner is really the one running the business.

Badger Guns and its predecessor, Badger Outdoors, have been the top sellers of crime guns recovered by Milwaukee police for at least the past decade, according to Milwaukee police data obtained by the Journal Sentinel in 2010. In less than two years, six Milwaukee police officers were wounded with guns sold by Badger Guns or Badger Outdoors.

Owners of Badger Guns and Badger Outdoors are facing civil lawsuits by four of the six police officers wounded with guns from the store.

Adam Allan's surrender of his license is not the first time such a change has occurred at the store.

In 2006, ATF investigators recommended revoking Badger Outdoors' license, but there was no revocation. The license was surrendered, and co-owner Mick Beatovic retired. The other owner, Wally Allan, went to work for his son, Adam, who pulled a new license and changed the name to Badger Guns.

Beatovic moved to Arizona but remains landlord of the store. Beatovic declined to comment Tuesday, citing advice from his attorney in the civil suit filed by the police officers.

The changes made in 2006 created what one federal official called a "clean slate," erasing violations found by federal regulators over 17 years at Badger Outdoors - which had been the top seller of crime guns not just in Milwaukee but the nation in 2005 with 537 such guns, according to ATF records.

A Journal Sentinel investigation published in December found ATF rarely tries to revoke or deny renewal of firearm licenses. When the agency does try, it succeeds just half the time and takes an average of 15 months to process the action, an analysis of ATF data by the newspaper found. The process can drag on for years if appealed to court.

The report also found more than 50 examples across the country, including Wisconsin, where a dealer was revoked but remains close to a gun-dealing operation after a family member, friend or employee received a fresh license.

ATF officials call it a problem that they are often powerless to stop because of limits placed on the agency's regulation of gun stores by Congress - one of several ways that federal lawmakers have crippled ATF's ability to regulate law-breaking gun dealers.

Badger Guns history

In 2008, ATF investigators conducted an inspection at Badger Guns and found violations. After that inspection, the agency issued a warning letter that told store owner Adam Allan his license could be revoked if violations were found again.

ATF investigators were back in 2010. Officials denied Adam Allan's license renewal after finding violations, the Journal Sentinel reported in December.

The ATF generally is not allowed to disclose violations because of secrecy laws passed by Congress that protect gun dealers.

Allan said the agency found minor paperwork violations. Former ATF officials have said there are no other violations but paperwork found during inspections, and sometimes they indicate a serious problem.

After two Milwaukee polices officers were shot in mid-2009, Flynn ordered an operation outside of Badger Guns. Officers discovered that felons frequented Badger Guns, with some even practicing on the shooting range, which is against the law. Federal law does not require gun shops to run background checks on people using gun ranges.

Police also found evidence of straw buying, where guns are sold through someone with a clean record to felons and others prohibited from buying them. In response, Allan posted a sign in front of the store calling the Milwaukee police racist.

Following disclosures of what was going on at Badger Guns, West Milwaukee Police Chief Dennis Nasci said he visited Allan and entered in agreements to have police get more involved in operations. Since late 2009, Nasci said, Allan has voluntarily handed over paperwork of denied gun sales and allowed police to run background checks on the nearly 15,000 people who have used the range. The store also has called police to check used guns the stores buys to make sure they are not stolen.

Nasci said he has not seen the number of crime guns coming out of Badger Guns, but he thinks the cooperation has cut the number. He hopes the next owner will act as Allan has since late 2009.

"I know there will be a lot of people who won't be sad to see Badger Guns go away," Nasci said. "But as I say, it is better to know your evil than not, especially if that is someone willing to work with you. I am not painting Adam as evil, but we know the relationship we have with him."

The decision by Badger Guns, first reported by WDJT-TV (Channel 58), comes shortly after a gun dealer in Shawano gave up its fight to keep its license, four years after he was revoked. Shawano Gun & Loan took its case into federal district court and ultimately U.S. appeals court, where it lost. Allan said he could not afford such a court fight with ATF and also defend himself against the lawsuits brought by the wounded police officers.

Shawano Gun & Loan's federal firearms license was revoked for repeatedly failing to keep accurate records and for making suspected straw gun sales, according to ATF records. Shawano Gun's attorney said no one else will be selling guns from that location.