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Keywords

defendantstatutetax lawcommon law

defendantstatute

Related Cases

Pasquantino v. U.S., 544 U.S. 349, 125 S.Ct. 1766, 161 L.Ed.2d 619, 96 A.F.T.R.2d 2005-5392, 73 USLW 4287, 05 Cal. Daily Op. Serv. 3482, 2005 Daily Journal D.A.R. 4705, 2005 Daily Journal D.A.R. 4712, 18 Fla. L. Weekly Fed. S 237, 4 A.L.R. Fed. 2d 747

Facts

Petitioners Carl J. Pasquantino, David B. Pasquantino, and Arthur Hilts were indicted for wire fraud after carrying out a scheme to smuggle large quantities of liquor into Canada from the United States. They ordered liquor over the phone from stores in Maryland and employed drivers to transport the liquor across the Canadian border without paying the required excise taxes. The drivers concealed the liquor and failed to declare it to Canadian customs officials, thereby evading substantial taxes that were approximately double the liquor's purchase price.

Issue

Whether a plot to defraud a foreign government of tax revenue violates the federal wire fraud statute, 18 U.S.C. § 1343.

The question presented in this case is whether a plot to defraud a foreign government of tax revenue violates the federal wire fraud statute, 18 U.S.C. § 1343 (2000 ed., Supp. II).

Rule

The wire fraud statute prohibits the use of interstate wires to effect 'any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses.'

The wire fraud statute prohibits the use of interstate wires to effect 'any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises.'

Analysis

The court determined that the petitioners' actions constituted a scheme to defraud Canada of its right to collect excise taxes, which was deemed 'property' under the wire fraud statute. The court found that the right to collect taxes is an economic interest and that the petitioners' conduct, which involved concealing imported liquor from Canadian officials, satisfied the elements of wire fraud. The court also concluded that the prosecution did not violate the common law revenue rule, as it was a criminal prosecution for domestic conduct rather than an enforcement of foreign tax laws.

The court determined that the petitioners' actions constituted a scheme to defraud Canada of its right to collect excise taxes, which was deemed 'property' under the wire fraud statute.

Conclusion

The Supreme Court affirmed the Fourth Circuit's decision, holding that the defendants' scheme to defraud Canada of tax revenue violated the federal wire fraud statute.

Who won?

The United States prevailed in the case because the Supreme Court upheld the convictions, affirming that the defendants' actions constituted wire fraud under U.S. law.

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