From The Arizona Republic, via. SayUncle …

Cavalry Arms Corp. says on its Web site that it has been “engaged in an ongoing dispute” with the Bureau of Alcohol, Tobacco, Firearms and Explosives, or ATF, for two years over “regulatory and compliance mistakes.”

But in federal court last week, owner Shawn Nealon admitted that he and his company illegally sold as many as 40 weapons to an out-of state buyer, and he voluntarily surrendered his federal firearms licenses, meaning Cavalry will no longer be able to import, manufacture or deal in weapons or ammunition.

“This is not some individual setting up a stand at a gun show,” U.S. Attorney Dennis Burke said Friday. “These are the preliminary steps that individuals take to get around federal laws in order to traffic in illegal firearms.”

Sebastian makes the point that the firearm industry is unique in that unlike other heavily regulated industries, such as pharmaceuticals, it is made up of lots of small companies.

One reason I think we see a lot of things like this and like this in the firearms industry is that you’re dealing with smaller players who don’t have the money to hire full time legal staff, or maintain staff that deal specifically with ensuring regulatory compliance