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NCJ Number: NCJ 215439     Find in a Library
Title: Whiskey and the Wires: The Inadvisable Application of the Wire Fraud Statute to Alcohol Smuggling and Foreign Tax Evasion
Author(s): Jason S. Friedman
  Journal: Journal of Criminal Law and Criminology  Volume:96  Issue:3  Dated:Spring 2006  Pages:911 to 946
Date Published: 2006
Page Count: 36
  Annotation: This article critiques the U.S. Supreme Court's decision in Pasquantino v. United States (2005), which holds that a scheme to defraud a foreign government of tax revenue violates the wire fraud statute and that the common law revenue rule does not preclude prosecutions for wire fraud violations that stem from such a scheme.
Abstract: This ruling affirmed the convictions of three men who had been prosecuted under the wire fraud statute for a scheme to evade Canadian excise taxes by smuggling alcohol into Canada from the United States. The Supreme Court's decision is correct in asserting that the wire fraud statute does not undermine any well-established revenue-rule principle that bars prosecution for a scheme to evade foreign taxes; however, the Court's ruling is ultimately flawed, because a scheme to evade foreign taxes does not properly fall within the scope of the wire fraud statute. The legislative history of the wire fraud statute weighs against the Court's ruling, since the statute was drafted with a focus on domestic schemes and domestic injuries that result from misuse of United States wires. Moreover, the Court's decision departs from the Court's long-held presumption that Congress ordinarily intends for its sentences and restitution awards from wire fraud convictions for smuggling schemes to be calculated based on the combined impact of the domestic and extraterritorial conduct. Absent a clearer directive from Congress, the Court's decision grants an unwarranted extension of the wire fraud statute to conduct whose ultimate harms are in foreign jurisdictions covered by foreign laws. 257 footnotes
Main Term(s): Criminology
Index Term(s): Jurisdiction ; Fraud ; Smuggling/Trafficking ; Tax evasion ; US Supreme Court decisions ; Foreign laws ; Canada ; United States of America
Publisher URL: 
Type: Legislation/Policy Analysis
Country: United States of America
Language: English
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