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IS IT U.S. WIRE FRAUD TO DUCK YOUR ZIMBABWE TAXES?

April 27, 2005

The U.S. Supreme Court passed down two decisions yesterday on the impact of foreign laws on U.S. citizens.

In Pasquantino v. U.S., the Court held that conspiracy to evade Canadian alcohol import duties constituted wire fraud under U.S. law.

In Small v. U.S., (via Instapundit), the Court held that U.S. laws prohibiting felons from posessing firearms don't apply when the felony conviction was by a foreign government. The New York Times sums up the Court's logic:

Justice Breyer said the gun law would create anomalies if applied to foreign convictions, because foreign legal systems have made different choices of what conduct to regard as criminal. Citing the Russian criminal code as an example, he said that someone might be regarded as a felon "for engaging in economic conduct that our society might encourage." A foreign conviction does not necessarily indicate that a person is dangerous, Justice Breyer said.

That seems sensible, but it also seems the same logic ought to apply to tax law. Third world and former east-bloc kleptocracies are notoriously capricious and selective in drafting and enforcing their tax laws. If Robert Mugabe decides to confiscate your property and you try to flee Zimbabwe with some of it, does that become "wire fraud?" This doesn't sound like a good thing.

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