It is a semi auto and was built by TNW I'm using new production S&B brass ammo. The gun is punching/heavily deforming primers and deforming the brass
the only two things i can think of (dont have experience with the system) Is that maybe the split pin is compressing under operation and allowing the barrel to move forward or the slot cut in the barrel is in the wrong place and is throwing the headspace off.
There could also be a chance the barrel was chambered too deep.
Have you tried any other type of ammo? that may be the issue
http://www.ppsh41.com/