A Nevada man has been indicted by a federal grand jury in Sacramento on charges that he sold dozens of firearms in California, including weapons that were later seized by law enforcement as far away as Chiapas, Mexico.
Gary Keith Osterhout, a Sparks, Nevada, man who formerly lived in Tracy, was charged in a six-count indictment that resulted in federal Bureau of Alcohol, Tobacco, Firearms and Explosives agents seizing nearly 500 weapons from him.
The case began with the ATF and Sacramento Police Department jointly investigating guns being purchased by a south Sacramento gang. Their efforts led them back to Osterhout as having originally sold one of the weapons, authorities say.
Osterhout could not be reached for comment, but court documents say he sold 45 weapons to undercover buyers – 35 of them in roadside sales from his car in Truckee and Emigrant Gap – as part of an illegal firearms dealing business he operated by buying weapons at gun shows in Reno or online and reselling them at a profit.
“Firearms trafficking from Nevada to California has been a longstanding problem for us in this area with the Interstate 80 corridor,” said Graham Barlowe, resident agent in charge of the Sacramento ATF office. “Over the course of my career, it’s been an issue we’ve had to pay constant attention to.”
Court documents say that undercover buyers purchased 45 weapons from Osterhout from May through November 2018 at buys in Truckee, Emigrant Gap, Reno and Verdi, Nevada, and that authorities seized another 436 weapons from his home.
Osterhout first came to the ATF’s attention after he purchased a firearm from a federal firearms license dealer and it later ended up being sold by a convicted felon during an undercover buy operation.
“This transaction took place 31 days after Osterhout lawfully purchased the firearm,” according to a search warrant affidavit by ATF Special Agent Mark Giacomantonio. “I subsequently reviewed firearm purchase records for Osterhout, which revealed that Osterhout has been the initial purchaser on at least 14 firearms that have been recovered by law enforcement as part of criminal investigation(s).”
According to court records, those weapons include:
▪ a .308-caliber rifle recovered by Roseville police in April 2016 from a man who “possessed the rifle in violation of a protective order.”
▪ a .38-caliber revolver recovered by Sacramento police from a validated gang member and convicted felon in October 2017.
▪ and a 9 mm Beretta pistol recovered by Mexican police in Chiapas from a car that was believed to be en route to deliver weapons to Guatemala.
Court filings say that since March 2015 Osterhout purchased at least 290 firearms, including some in and around the dates of Reno gun shows such as the Crossroads of the West and the Big Reno gun shows.
The ATF has long targeted sales of weapons at such gun shows to California buyers who plan to bring them back across the state line illegally, and court records say an undercover ATF agent purchased two firearms from Osterhout on May 19, 2018, at the Crossroads of the West gun show despite mentioning “several times” that he was from California.
Later that same day, a confidential informant working for the ATF tried to buy weapons from Osterhout and told him they were not from Nevada, but Osterhout refused, saying the transaction had to be made through a federally licensed firearms dealer, court documents say.
Despite that refusal, Osterhout later sold weapons to undercover buyers in Nevada and California, and advised one undercover agent that if he was trying to buy at a gun show he “should act like he was from Nevada,” court documents say.
“Osterhout went on to say he did not have a problem selling firearms to the (undercover agent) but he would not sell to ‘Oakland people,’” the documents say.
“I live in Nevada ...” Osterhout added, according to the documents. “I don’t have to wait 30 days for one gun. I can buy 10 guns in one day if I want to ... it’s sad we have to do what we do.”
Osterhout told one ATF undercover buyer that he could gross $20,000 to $30,000 at a big gun show, “but his net is approximately 15 percent,” court documents say.
During an undercover buy in Truckee in October 2018, “Osterhout relayed to the (undercover buyer) that ‘I don’t have a problem selling to people from California because I lived in California and know how f----- up it is,’” court documents say.
He also offered to walk an undercover buyer through a gun show and buy any weapons the buyer picked out, documents say, and did so the next week, procuring a vendor pass for the buyer to gain access to the show, which was not open to the general public. The buyer obtained one weapon through Osterhout at the show and Osterhout “intentionally introduced him to other proprietors who would more than likely sell firearms” to him, court documents say.
Osterhout faces charges of unlawful dealing in firearms, unlawful sale to an out-of-state resident and criminal forfeiture allegations seeking surrender of the 436 weapons seized. He could face up to five years in prison and $250,000 in fines.
“He’s not the only person who’s doing this, and we will continue to investigate people that are involved in schemes like this to traffic firearms from Nevada to California,” Barlowe said.