PASQUANTINO et al. v. UNITED STATES

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PASQUANTINO et al. v. UNITED STATES
certiorari to the united states court of appeals for
the fourth circuit
No. 03–725. Argued November 9, 2004—Decided April 26, 2005
Petitioners carried out a scheme to smuggle large quantities of liquor into
Canada from the United States to evade Canada’s heavy alcohol import
taxes. They were convicted of violating the federal wire fraud statute,
18 U. S. C. § 1343, for doing so. That statute prohibits the use of inter-
state wires to effect “any scheme or artifice to defraud, or for obtaining
money or property by means of false or fraudulent pretenses.” The
Fourth Circuit affirmed their convictions, rejecting petitioners’ argu-
ment that their prosecution contravened the common-law revenue rule,
which bars courts from enforcing foreign sovereigns’ tax laws. The
Fourth Circuit also held that Canada’s right to receive tax revenue was
“money or property” within § 1343’s meaning.
Held: A plot to defraud a foreign government of tax revenue violates the
federal wire fraud statute. Pp. 355–372.
(a) Section 1343’s plain terms criminalize a scheme such as petition-
ers’. Their smuggling operation satisfies both of the § 1343 elements
that are in dispute here. First, Canada’s right to uncollected excise
taxes on the liquor petitioners imported into Canada is “property”
within the statute’s meaning. That right is an entitlement to collect
money from petitioners, the possession of which is “something of value”
to the Canadian Government. McNally v. United States, 483 U. S. 350,
358. Such valuable entitlements are “property” as that term ordinarily
is employed. Second, petitioners’ plot was a “scheme or artifice to de-
fraud” Canada of its valuable entitlement to tax revenue, because peti-
tioners routinely concealed imported liquor from Canadian officials and
failed to declare those goods on customs forms. See Durland v. United
States, 161 U. S. 306, 313. Pp. 355–359.
(b) The foregoing construction of § 1343 does not derogate from the
common-law revenue rule. Pp. 359–372.
(1) Relying on the canon of construction that “ ‘[s]tatutes which in-
vade the common law . . . are to be read with a presumption favoring
the retention of long-established and familiar principles, except when a
statutory purpose to the contrary is evident,’ ” United States v. Texas,
507 U. S. 529, 534, petitioners argue that, to avoid reading § 1343
to derogate from the revenue rule, the Court should construe the
otherwise-applicable statutory language to except frauds directed at

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evading foreign taxes. Whether § 1343 derogates from the revenue
rule depends on whether reading the statute to reach this prosecution
conflicts with a well-established revenue rule principle. See United
States v. Craft, 535 U. S. 274, 276. Thus, before concluding that Con-
gress intended to exempt the present prosecution from § 1343’s broad
reach, the Court must find that the revenue rule clearly barred such a
prosecution as of 1952, the year Congress enacted the wire fraud stat-
ute. See Neder v. United States, 527 U. S. 1, 22–23. Pp. 359–360.
(2) No common-law case decided as of 1952 clearly established that
the revenue rule barred the United States from prosecuting a fraudulent
scheme to evade foreign taxes. Pp. 360–368.
(i) The revenue rule has long been treated as a corollary of the
rule that “[t]he Courts of no country execute the penal laws of another.”
The Antelope, 10 Wheat. 66, 123. It was first treated as such in cases
prohibiting the enforcement of tax liabilities of one sovereign in the
courts of another sovereign, such as suits to enforce tax judgments.
The revenue rule’s grounding in these cases shows that, at its core, it
prohibited the collection of tax obligations of foreign nations. The pres-
ent prosecution is unlike these classic examples of actions traditionally
barred by the revenue rule. It is not a suit that recovers a foreign tax
liability, but is a criminal prosecution brought by the United States to
punish domestic criminal conduct. Pp. 360–362.
(ii) Cases applying the revenue rule to bar indirect enforcement
of foreign revenue laws, in contrast to the direct collection of a tax
obligation, cannot bear the weight petitioners place on them. Many of
them were decided after Congress passed the wire fraud statute.
Others come from foreign courts. And, significantly, none involved a
domestic sovereign acting pursuant to authority conferred by a criminal
statute to enforce the sovereign’s own penal law. Moreover, none of
petitioners’ cases barred an action that had as its primary object the
deterrence and punishment of fraudulent conduct—a substantial domes-
tic regulatory interest entirely independent of foreign tax enforcement.
The main object of the action in each of them was the collection of
money that would pay foreign tax claims. The absence of such an ob-
ject here means that the link between this prosecution and foreign tax
collection is incidental and attenuated at best. Thus, it cannot be said
whether Congress in 1952 would have considered this prosecution
within the revenue rule. Petitioners answer unpersuasively that the
recovery of taxes is indeed the object of this suit because restitution of
Canada’s lost tax revenue is required under the federal Mandatory Vic-
tims Restitution Act of 1996. Whether restitution is mandatory is ir-
relevant here because § 1343 advances the Government’s independent
interest in punishing fraudulent domestic criminal conduct. In any

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event, if awarding restitution to foreign sovereigns were contrary to the
revenue rule, the proper resolution would be to construe the later
enacted restitution statute not to allow such awards, rather than to as-
sume that it impliedly repealed § 1343 as applied to this prosecution.
Pp. 362–365.
(iii) Also unavailing is petitioners’ argument that early English
common-law cases holding unenforceable contracts executed to evade
other nations’ revenue laws demonstrate that “indirect” enforcement of
such laws is at the very core of the revenue rule, rather than at its
margins. Those early cases were driven by an interest in lessening the
commercial disruption caused by high tariffs. By the mid-20th century,
however, that rationale was supplanted, and courts began to apply the
revenue rule to tax obligations on the strength of the analogy between
a country’s revenue laws and its penal ones. Because the early English
cases rested on a far different foundation from that on which the reve-
nue rule came to rest, they say little about whether the wire fraud
statute derogated from the revenue rule in its mid-20th-century form.
Pp. 365–366.
(iv) Petitioners’ criminal prosecution “enforces” Canadian reve-
nue law in an attenuated sense, but not in a sense that clearly would
contravene the revenue rule. That rule never proscribed all enforce-
ment of foreign revenue law. For example, at the same time they were
enforcing domestic contracts that had the purpose of violating foreign
revenue law, English courts also considered void foreign contracts that
lacked tax stamps required under foreign revenue law. The line the
revenue rule draws between impermissible and permissible “enforce-
ment” of foreign revenue law has therefore always been unclear. The
uncertainty persisted in American cases, which demonstrate that the
extent to which the revenue rule barred indirect recognition of foreign
revenue laws was unsettled as of 1952. Pp. 366–368.
(3) The traditional rationales for the revenue rule do not plainly
suggest that it barred this prosecution. First, this prosecution poses
little risk of causing the principal evil against which the revenue rule
was traditionally thought to guard: judicial evaluation of the revenue
policies of foreign sovereigns. This action was brought by the Execu-
tive, “the sole organ of the federal government in the field of interna-
tional relations,” United States v. Curtiss-Wright Export Corp., 299
U. S. 304, 320. Although a prosecution like this one requires a court to
recognize foreign law to determine whether the defendant violated U. S.
law, it may be assumed that by electing to prosecute, the Executive
has assessed this prosecution’s impact on this Nation’s relationship with
Canada, and concluded that it poses little danger of causing international
friction. Petitioners’ broader argument that the revenue rule avoids

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giving domestic effect to politically sensitive and controversial policy
decisions embodied in foreign revenue laws worries the Court little.
The present prosecution, if authorized by the wire fraud statute, embod-
ies the policy choice of the two political branches of Government—Con-
gress and the Executive—to free the interstate wires from fraudulent
use, irrespective of the object of the fraud. Such a reading of § 1343
gives effect to that considered policy choice and therefore poses no risk
of advancing Canadian policies illegitimately. Finally, petitioners’ as-
sertion that courts lack the competence to examine the validity of unfa-
miliar foreign tax schemes is not persuasive here. Foreign law posed
no unmanageable complexity in this case, and Federal Rule of Criminal
Procedure 26.1 gives federal courts sufficient means to resolve any inci-
dental foreign law issues that may arise in wire fraud prosecutions.
Pp. 368–370.
(4) The Court’s interpretation does not give § 1343 extraterritorial
effect. Petitioners’ offense was complete the moment they executed
their scheme intending to defraud Canada of tax revenue inside the
United States. See Durland, 161 U. S., at 313. Therefore, only domes-
tic conduct is at issue here. In any event, because § 1343 punishes
frauds executed “in interstate or foreign commerce,” it is not a statute
that involves only domestic concerns. Pp. 371–372.
336 F. 3d 321, affirmed.
Thomas, J., delivered the opinion of the Court, in which Rehnquist,
C. J., and Stevens, O’Connor, and Kennedy, JJ., joined. Ginsburg, J.,
filed a dissenting opinion, in which Breyer, J., joined, and in which
Scalia and Souter, JJ., joined as to Parts II and III, post, p. 372.
Laura W. Brill argued the cause for petitioners. With
her on the briefs were Bruce R. Bryan and Jensen E. Barber.
Deputy Solicitor General Dreeben argued the cause for
the United States. With him on the brief were Acting So-
licitor General Clement, Assistant Attorney General Wray,
Irving L. Gornstein, and Kirby A. Heller.*
Justice Thomas delivered the opinion of the Court.
At common law, the revenue rule generally barred courts
from enforcing the tax laws of foreign sovereigns. The
*Joshua L. Dratel, Quentin Riegel, and Jeremy Maltby filed a brief for
the National Association of Criminal Defense Lawyers et al. as amici cu-
riae urging reversal.

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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).
Because the plain terms of § 1343 criminalize such a scheme,
and because this construction of the wire fraud statute does
not derogate from the common-law revenue rule, we hold
that it does.
I
Petitioners Carl J. Pasquantino, David B. Pasquantino, and
Arthur Hilts were indicted for and convicted of federal wire
fraud for carrying out a scheme to smuggle large quantities
of liquor into Canada from the United States. According to
the evidence presented at trial, the Pasquantinos, while in
New York, ordered liquor over the telephone from discount
package stores in Maryland. See 336 F. 3d 321, 325 (CA4
2003) (en banc). They employed Hilts and others to drive
the liquor over the Canadian border, without paying the
required excise taxes. Ibid. The drivers avoided paying
taxes by hiding the liquor in their vehicles and failing to
declare the goods to Canadian customs officials. Id., at 333.
During the time of petitioners’ smuggling operation, be-
tween 1996 and 2000, Canada heavily taxed the importation
of alcoholic beverages. See 1997 S. C., ch. 36, §§ 21.1(1),
21.2(1); Excise Act Schedule 1.(1), R. S. C., ch. E–14 (1985);
Excise Act 2001, Schedule 4, ch. 22, 2002 S. C. 239. Uncon-
tested evidence at trial showed that Canadian taxes then due
on alcohol purchased in the United States and transported
to Canada were approximately double the liquor’s purchase
price. App. 65–66.
Before trial, petitioners moved to dismiss the indictment
on the ground that it stated no wire fraud offense. 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, repre-
sentations, or promises.” 18 U. S. C. § 1343 (2000 ed., Supp.
II). Petitioners contended that the Government lacked a

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sufficient interest in enforcing the revenue laws of Canada,
and therefore that they had not committed wire fraud. App.
48–57. The District Court denied the motion, and the case
went to trial. The jury convicted petitioners of wire fraud.
Petitioners appealed their convictions to the United States
Court of Appeals for the Fourth Circuit, again urging that
the indictment failed to state a wire fraud offense. They
argued that their prosecution contravened the common-law
revenue rule, because it required the court to take cogni-
zance of the revenue laws of Canada. Over Judge Hamil-
ton’s dissent, the panel agreed and reversed the convictions.
305 F. 3d 291, 295 (2002). Petitioners also argued that Cana-
da’s right to collect taxes from them was not “money or prop-
erty” within the meaning of the wire fraud statute, but the
panel unanimously rejected that argument. Id., at 294–295;
id., at 299 (Hamilton, J., dissenting).
The Court of Appeals granted rehearing en banc, vacated
the panel’s decision, and affirmed petitioners’ convictions.
336 F. 3d 321 (CA4 2003). It concluded that the common-law
revenue rule, rather than barring any recognition of foreign
revenue law, simply allowed courts to refuse to enforce the
tax judgments of foreign nations, and therefore did not pre-
clude the Government from prosecuting petitioners. Id., at
327–329. The Court of Appeals held as well that Canada’s
right to receive tax revenue was “money or property” within
the meaning of the wire fraud statute. Id., at 331–332.
We granted certiorari to resolve a conflict in the Courts of
Appeals over whether a scheme to defraud a foreign govern-
ment of tax revenue violates the wire fraud statute. 541
U. S. 972 (2004). Compare United States v. Boots, 80 F. 3d
580, 587 (CA1 1996) (holding that a scheme to defraud a for-
eign nation of tax revenue does not violate the wire fraud
statute), with United States v. Trapilo, 130 F. 3d 547, 552–
553 (CA2 1997) (holding that a scheme to defraud a foreign
nation of tax revenue violates the wire fraud statute). We

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agree with the Court of Appeals that it does and therefore
affirm the judgment below. 1
II
We first consider whether petitioners’ conduct falls within
the literal terms of the wire fraud statute. The statute pro-
hibits using 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.”
18 U. S. C. § 1343 (2000 ed., Supp. II). Two elements of this
crime, and the only two that petitioners dispute here, are
that the defendant engage in a “scheme or artifice to de-
fraud,” ibid., and that the “object of the fraud . . . be ‘[money
or] property’ in the victim’s hands,” Cleveland v. United
States, 531 U. S. 12, 26 (2000).2 Petitioners’ smuggling oper-
ation satisfies both elements.
Taking the latter element first, Canada’s right to uncol-
lected excise taxes on the liquor petitioners imported into
Canada is “property” in its hands. This right is an entitle-
ment to collect money from petitioners, the possession of
which is “something of value” to the Government of Canada.
McNally v. United States, 483 U. S. 350, 358 (1987) (internal
1 We express no view on the related question whether a foreign govern-
ment, based on wire or mail fraud predicate offenses, may bring a civil
action under the Racketeer Influenced and Corrupt Organizations Act
(RICO) for a scheme to defraud it of taxes. See Attorney General of
Canada v. R. J. Reynolds Tobacco Holdings, Inc., 268 F. 3d 103, 106 (CA2
2001) (holding that the Government of Canada cannot bring a civil RICO
suit to recover for a scheme to defraud it of taxes); Republic of Honduras
v. Philip Morris Cos., 341 F. 3d 1253, 1255 (CA11 2003) (same with respect
to other foreign governments).
2 Although Cleveland interpreted the term “property” in the mail fraud
statute, 18 U. S. C. § 1341 (2000 ed., Supp. II), we have construed identical
language in the wire and mail fraud statutes in pari materia. See Neder
v. United States, 527 U. S. 1, 20 (1999) (“ ‘scheme or artifice to defraud’ ”);
Carpenter v. United States, 484 U. S. 19, 25, and n. 6 (1987) (“scheme or
artifice to defraud”; “money or property”).

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quotation marks omitted). Valuable entitlements like these
are “property” as that term ordinarily is employed. See
Leocal v. Ashcroft, 543 U. S. 1, 9 (2004) (“When interpreting
a statute, we must give words their ordinary or natural
meaning” (internal quotation marks omitted)); Black’s Law
Dictionary 1382 (4th ed. 1951) (defining “property” as “ex-
tend[ing] to every species of valuable right and interest”).
Had petitioners complied with this legal obligation, they
would have paid money to Canada. Petitioners’ tax evasion
deprived Canada of that money, inflicting an economic injury
no less than had they embezzled funds from the Canadian
treasury. The object of petitioners’ scheme was to deprive
Canada of money legally due, and their scheme thereby had
as its object the deprivation of Canada’s “property.”
The common law of fraud confirms this characterization of
Canada’s right to excise taxes. The right to be paid money
has long been thought to be a species of property. See 3
W. Blackstone, Commentaries on the Laws of England 153–
155 (1768) (classifying a right to sue on a debt as personal
property); 2 J. Kent, Commentaries on American Law *351
(same). Consistent with that understanding, fraud at com-
mon law included a scheme to deprive a victim of his entitle-
ment to money. For instance, a debtor who concealed his
assets when settling debts with his creditors thereby com-
mitted common-law fraud. 1 J. Story, Equity Jurisprudence
§ 378 (I. Redfield 10th rev. ed. 1870); Chesterfield v. Janssen,
28 Eng. Rep. 82, 2 Ves. Sen. 125 (ch. 1750); 1 S. Rapalje & R.
Lawrence, A Dictionary of American and English Law 546
(1883). That made sense given the economic equivalence be-
tween money in hand and money legally due. The fact that
the victim of the fraud happens to be the government, rather
than a private party, does not lessen the injury.
Our conclusion that the right to tax revenue is property in
Canada’s hands, contrary to petitioners’ contentions, is con-
sistent with Cleveland, supra. In that case, the defendant,

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Cleveland, had obtained a video poker license by making
false statements on his license application. Id., at 16–17.
We held that a State’s interest in an unissued video poker
license was not “property,” because the interest in choosing
particular licensees was “ ‘purely regulatory’ ” and “[could
not] be economic.” Id., at 22–23. We also noted that “the
Government nowhere allege[d] that Cleveland defrauded the
State of any money to which the State was entitled by
law.” Ibid.
Cleveland is different from this case. Unlike a State’s in-
terest in allocating a video poker license to particular appli-
cants, Canada’s entitlement to tax revenue is a straight-
forward “economic” interest. There was no suggestion in
Cleveland that the defendant aimed at depriving the State
of any money due under the license; quite the opposite, there
was “no dispute that [the defendant’s partnership] paid the
State of Louisiana its proper share of revenue” due. Id.,
at 22. Here, by contrast, the Government alleged and
proved that petitioners’ scheme aimed at depriving Canada
of money to which it was entitled by law. Canada could
hardly have a more “economic” interest than in the receipt
of tax revenue. Cleveland is therefore consistent with our
conclusion that Canada’s entitlement is “property” as that
word is used in the wire fraud statute.
Turning to the second element at issue here, petitioners’
plot was a “scheme or artifice to defraud” Canada of its valu-
able entitlement to tax revenue. The evidence showed that
petitioners routinely concealed imported liquor from Cana-
dian officials and failed to declare those goods on customs
forms. See 336 F. 3d, at 333. By this conduct, they repre-
sented to Canadian customs officials that their drivers had
no goods to declare. This, then, was a scheme “designed to
defraud by representations,” Durland v. United States, 161
U. S. 306, 313 (1896), and therefore a “scheme or artifice to
defraud” Canada of taxes due on the smuggled goods.

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Neither the antismuggling statute, 18 U. S. C. § 546, 3 nor
U. S. tax treaties, see Attorney General of Canada v. R. J.
Reynolds Tobacco Holdings, Inc., 268 F. 3d 103, 115–119
(CA2 2001), convince us that petitioners’ scheme falls outside
the terms of the wire fraud statute.4 Unlike the treaties
and the antismuggling statute, the wire fraud statute pun-
ishes fraudulent use of domestic wires, whether or not such
conduct constitutes smuggling, occurs aboard a vessel, or
evades foreign taxes. See post, at 380, n. 9 (Ginsburg, J.,
dissenting) (noting that the antismuggling statute does not
apply to this prosecution). Petitioners would be equally lia-
ble if they had used interstate wires to defraud Canada not
of taxes due, but of money from the Canadian treasury. The
wire fraud statute “applies without differentiation” to these
two categories of fraud. Clark v. Martinez, 543 U. S. 371,
378 (2005). “To give these same words a different meaning
3 Section 546 provides:
“Any person owning in whole or in part any vessel of the United States
who employs, or participates in, or allows the employment of, such vessel
for the purpose of smuggling, or attempting to smuggle, or assisting in
smuggling, any merchandise into the territory of any foreign government
in violation of the laws there in force, if under the laws of such foreign
government any penalty or forfeiture is provided for violation of the laws
of the United States respecting the customs revenue, and any citizen of,
or person domiciled in, or any corporation incorporated in, the United
States, controlling or substantially participating in the control of any such
vessel, directly or indirectly, whether through ownership of corporate
shares or otherwise, and allowing the employment of said vessel for any
such purpose, and any person found, or discovered to have been, on board
of any such vessel so employed and participating or assisting in any such
purpose, shall be fined under this title or imprisoned not more than two
years, or both.”
4 Any overlap between the antismuggling statute and the wire fraud
statute is beside the point. The Federal Criminal Code is replete with
provisions that criminalize overlapping conduct. See Stuntz, The Patho-
logical Politics of Criminal Law, 100 Mich. L. Rev. 505, 518, and n. 62
(2002); United States v. Wells, 519 U. S. 482, 505–509, and nn. 8–10 (1997)
(Stevens, J., dissenting). The mere fact that two federal criminal stat-
utes criminalize similar conduct says little about the scope of either.

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for each category would be to invent a statute rather than
interpret one.” Ibid. We therefore decline to “interpret
[this] criminal statute more narrowly than it is written.”
Brogan v. United States, 522 U. S. 398, 406 (1998).
III
We next consider petitioners’ revenue rule argument.
Petitioners argue that, to avoid reading § 1343 to derogate
from the common-law revenue rule, we should construe the
otherwise-applicable language of the wire fraud statute to
except frauds directed at evading foreign taxes. Their ar-
gument relies on the canon of construction that “[s]tatutes
which invade the common law . . . are to be read with a
presumption favoring the retention of long-established and
familiar principles, except when a statutory purpose to the
contrary is evident.” United States v. Texas, 507 U. S. 529,
534 (1993) (internal quotation marks omitted). This pre-
sumption is, however, no bar to a construction that conflicts
with a common-law rule if the statute “ ‘speak[s] directly’ to
the question addressed by the common law.” Ibid.
Whether the wire fraud statute derogates from the
common-law revenue rule depends, in turn, on whether read-
ing § 1343 to reach this prosecution conflicts with a well-
established revenue rule principle. We clarified this con-
straint on the application of the nonderogation canon in
United States v. Craft, 535 U. S. 274 (2002). The issue in
Craft was whether the property interest of a tenant by the
entirety was exempt from a federal tax lien. Id., at 276.
We construed the federal tax lien statute to reach such a
property interest, despite the tension between that construc-
tion and the common-law rule that entireties property enjoys
immunity from liens, because this “common-law rule was not
so well established with respect to the application of a fed-
eral tax lien that we must assume that Congress considered
the impact of its enactment on the question now before us.”

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Id., at 288. 5 So too here, before we may conclude that Con-
gress intended to exempt the present prosecution from the
broad reach of the wire fraud statute, we must find that the
common-law revenue rule clearly barred such a prosecution.
We examine the state of the common law as of 1952, the
year Congress enacted the wire fraud statute. See Neder v.
United States, 527 U. S. 1, 22–23 (1999). 6
The wire fraud statute derogates from no well-established
revenue rule principle. We are aware of no common-law
revenue rule case decided as of 1952 that held or clearly im-
plied that the revenue rule barred the United States from
prosecuting a fraudulent scheme to evade foreign taxes.
The traditional rationales for the revenue rule, moreover, do
not plainly suggest that it swept so broadly. We consider
these two points in turn.
A
We first consider common-law revenue rule jurisprudence
as it existed in 1952, the year Congress enacted § 1343.
Since the late 19th and early 20th century, courts have
treated the common-law revenue rule as a corollary of the
5 See also United States v. Texas, 507 U. S. 529, 534 (1993) (requiring the
statute to “ ‘speak directly’ to the question addressed by the common
law”); Astoria Fed. Sav. & Loan Assn. v. Solimino, 501 U. S. 104, 108
(1991) (stating that this presumption is applicable “where a common-law
principle is well established”); United States v. Turley, 352 U. S. 407, 411
(1957) (declining to interpret the term “ ‘stolen’ ” in a federal criminal stat-
ute according to the common law because the term had “no accepted
common-law meaning”).
6 These principles convince us that much more than the summary conclu-
sion that it is “unavoidably obvious . . . that this prosecution directly impli-
cates the revenue rule” and that this prosecution is “ ‘primarily about en-
forcing Canadian law,’ ” post, at 377, 382 (Ginsburg, J., dissenting), is
required to demonstrate that a revenue rule principle firmly established
as of 1952 bars this prosecution. That task requires inquiry into
common-law revenue rule jurisprudence—an inquiry the dissent does not
undertake.

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rule that, as Chief Justice Marshall put it, “[t]he Courts of
no country execute the penal laws of another.” The Ante-
lope, 10 Wheat. 66, 123 (1825). The rule against the enforce-
ment of foreign penal statutes, in turn, tracked the common-
law principle that crimes could only be prosecuted in the
country in which they were committed. See, e. g., J. Story,
Commentaries on the Conflict of Laws § 620, p. 840 (M. Big-
elow ed. 8th ed. 1883). The basis for inferring the revenue
rule from the rule against foreign penal enforcement was an
analogy between foreign revenue laws and penal laws. See
Wisconsin v. Pelican Ins. Co., 127 U. S. 265, 290 (1888);
Leflar, Extrastate Enforcement of Penal and Governmental
Claims, 46 Harv. L. Rev. 193, 219 (1932) (hereinafter Leflar).
Courts first drew that inference in a line of cases prohibit-
ing the enforcement of tax liabilities of one sovereign in the
courts of another sovereign, such as a suit to enforce a tax
judgment. 7 The revenue rule’s grounding in these cases
shows that, at its core, it prohibited the collection of tax obli-
gations of foreign nations. Unsurprisingly, then, the reve-
nue rule is often stated as prohibiting the collection of for-
eign tax claims. See Brief for Petitioners 16 (noting that
“[t]he most straightforward application of the revenue rule
arises when a foreign sovereign attempts to sue directly in
its own right to enforce a tax judgment in the courts of an-
other nation”). 8
7 See Colorado v. Harbeck, 232 N. Y. 71, 85, 133 N. E. 357, 360 (App.
1921); Maryland v. Turner, 75 Misc. 9, 10–13, 132 N. Y. S. 173, 175 (Sup.
Ct. 1911); Detroit v. Proctor, 44 Del. 193, 200–202, 61 A. 2d 412, 415–416
(Super. Ct. 1948); Moore v. Mitchell, 30 F. 2d 600, 603–604 (CA2 1929) (L.
Hand, J., concurring) (citing cases), aff ’d on other grounds, 281 U. S. 18
(1930); Arkansas v. Bowen, 20 D. C. 291, 295 (Sup. Ct. 1891), aff ’d, 3 App.
D. C. 537 (1894); Leflar 216, n. 63 (citing cases).
8 See also Her Majesty the Queen v. Gilbertson, 597 F. 2d 1161, 1163–
1164 (CA9 1979) (stating the revenue rule as an exception to the rule that
a State enforces foreign judgments, citing, inter alia, pre-1952 cases);
Peter Buchanan Ltd. v. McVey, 1955 A. C. 516, 526 (Ir. H. Ct. 1950),

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362 PASQUANTINO v. UNITED STATES
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The present prosecution is unlike these classic examples of
actions traditionally barred by the revenue rule. It is not a
suit that recovers a foreign tax liability, like a suit to enforce
a judgment. This is a criminal prosecution brought by the
United States in its sovereign capacity to punish domes-
tic criminal conduct. Petitioners nevertheless argue that
common-law revenue rule jurisprudence as of 1952 prohib-
ited such prosecutions. Revenue rule cases, however, do not
establish that proposition, much less clearly so.
1
Petitioners first analogize the present action to several
cases that have applied the revenue rule to bar indirect en-
forcement of foreign revenue laws, in contrast to the direct
collection of a tax obligation. They cite, for example, a deci-
sion of an Irish trial court holding that a private liquidator
could not recover assets unlawfully distributed and moved
to Ireland by a corporate director, because the recovery
would go to satisfy the company’s Scottish tax obligations.
Peter Buchanan Ltd. v. McVey, 1955 A. C. 516, 529–530 (Ir.
H. Ct. 1950), app. dism’d, 1955 A. C. 530 (Ir. Sup. Ct. 1951). 9
app. dism’d, 1955 A. C. 530 (Ir. Sup. Ct. 1951) (citing English revenue rule
cases as “establish[ing] that the courts of our country will not enforce the
revenue claims of a foreign country in a suit brought for the purpose by a
foreign public authority”); Leflar 219 (stating the revenue rule as a prohi-
bition on “extrastate actions for revenue collection”); Moore, supra, at 603
(L. Hand, J., concurring) (characterizing the revenue rule as an exception
to the rule that a “liability arising under the law of a foreign state will be
recognized by the courts of another”); Harbeck, supra, at 85, 133 N. E., at
360 (stating that the revenue rule “precludes one state from acting as a
collector of taxes for a sister state”); cf. Restatement (Third) of Foreign
Relations Law of the United States § 483 (1986) (stating that the rule does
not require, but allows, courts to refuse enforcement of foreign tax
judgments).
9 Petitioners also cite QRS 1 Aps v. Frandsen, [2000] Int’l Litig. Proc. 8,
[1999] 3 All E. R. 289 (App.) (holding that a liquidator was not entitled to
recover corporate funds needed to pay foreign taxes); Stringam v. Dubois,
[1993] 3 W. W. R. 273, 7 Alta. L. R. (3d) 120 (App. 1992) (rejecting suit by

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The court found that “the sole object of the liquidation pro-
ceedings in Scotland was to collect a revenue debt,” because
if the liquidator won, “every penny recovered after paying
certain costs . . . could be claimed by the Scottish Revenue.”
Id., at 530. According to the Buchanan court, “[i]n every
case the substance of the claim must be scrutinized, and if it
then appears that it is really a suit brought for the purpose
of collecting the debts of a foreign revenue it must be re-
jected.” Id., at 529.
Buchanan and the other cases on which petitioners rely
cannot bear the weight petitioners place on them. Many of
them were decided after 1952, too late for the Congress that
passed the wire fraud statute to have relied on them. Oth-
ers come from foreign courts. Drawing sure inferences re-
garding Congress’ intent from such foreign citations is peril-
ous, as several of petitioners’ cases illustrate. 10
the U. S. executor of a will to require the sale of real property in Canada
to pay U. S. estate taxes); Banco Do Brasil, S. A. v. A. C. Israel Commod-
ity Co., 12 N. Y. 2d 371, 377, 190 N. E. 2d 235, 237 (App. 1963) (rejecting
suit by instrumentality of Brazil to recover for a conspiracy to circumvent
its foreign exchange regulations); United States v. Harden, [1963] 44
W. W. R. 630, 633, S. C. R. 366, 370–371 (Sup. Ct. Can.) (holding that a
stipulated judgment to pay U. S. taxes was not enforceable in Canadian
courts); Attorney-General for Canada v. Schulze, [1901] 9 Scots Law
Times 4, 4–5 (refusing to enforce judgment for court costs, where costs
were incurred by a foreign state in defending the legality of its forfeiture
of the defendant’s goods as penalty for infraction of revenue laws); Indian
and General Investment Trust, Ltd. v. Borax Consolidated, Ltd., [1920] 1
K. B. 539, 550 (holding that a private debtor was not entitled to deduct
U. S. income tax from its interest payments on loan due in England).
10 For example, in Government of India v. Taylor, 1955 A. C. 491 (H. L.),
on which petitioners rely heavily, the court’s application of the revenue
rule rested in part on a ground peculiar to English law, namely, that an Act
of Parliament had excluded tax judgments from a statute that provided for
the enforcement of foreign judgments. That Act thus demonstrated that
the revenue rule “appear[ed] to have been recognized by Parliament.”
Id., at 506; see also Borax, supra, at 549 (holding that a private debtor
was not entitled to deduct U. S. income tax from its interest payments on
a loan, in part because “there [was] an express Act of Parliament which

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364 PASQUANTINO v. UNITED STATES
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More important, none of these cases clearly establishes
that the revenue rule barred this prosecution. None in-
volved a domestic sovereign acting pursuant to authority
conferred by a criminal statute. The difference is signifi-
cant. An action by a domestic sovereign enforces the sover-
eign’s own penal law. A prohibition on the enforcement of
foreign penal law does not plainly prevent the Government
from enforcing a domestic criminal law. Such an extension,
to our knowledge, is unprecedented in the long history of
either the revenue rule or the rule against enforcement of
penal laws.
Moreover, none of petitioners’ cases (with the arguable ex-
ception of Banco Do Brasil, S. A. v. A. C. Israel Commodity
Co., 12 N. Y. 2d 371, 190 N. E. 2d 235 (App. 1963)) barred
an action that had as its primary object the deterrence and
punishment of fraudulent conduct—a substantial domestic
regulatory interest entirely independent of foreign tax en-
forcement. The main object of the action in each of those
cases was the collection of money that would pay foreign tax
claims. The absence of such an object in this action means
that the link between this prosecution and foreign tax collec-
tion is incidental and attenuated at best, making it not
plainly one in which “the whole object of the suit is to collect
tax for a foreign revenue.” Buchanan, supra, at 529.
Even those courts that as of 1952 had extended the revenue
rule beyond its core prohibition had not faced a case closely
permits payment to the English Income Tax authorities to be a discharge
pro tanto of the debt which a person owes in respect of yearly interest to
another” while “[t]here [was] no Act of Parliament which allows payment
of income tax to another country to be reckoned as discharge”); Schulze,
supra, at 5 (holding that a foreign state could not recover court costs
incurred in defending the legality of a tax forfeiture, in part because “in
our [i. e., Scottish] law, the expenses of an action have always been re-
garded as a mere accessory or incident of the principal claim”). In addi-
tion, as we explain below, features peculiar to the American system of
separation of powers cast doubt on the notion that the revenue rule bars
this prosecution. See infra, at 369–370.

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analogous to this one—and thus we cannot say with any rea-
sonable certainty whether Congress in 1952 would have con-
sidered this prosecution within the revenue rule.
Petitioners answer that the recovery of taxes is indeed the
object of this suit, because restitution of the lost tax revenue
to Canada is required under the Mandatory Victims Restitu-
tion Act of 1996, 18 U. S. C. §§ 3663A–3664 (2000 ed. and
Supp. II).11 We do not think it matters whether the provi-
sion of restitution is mandatory in this prosecution. Re-
gardless, the wire fraud statute advances the Federal Gov-
ernment’s independent interest in punishing fraudulent
domestic criminal conduct, a significant feature absent from
all of petitioners’ revenue rule cases. The purpose of
awarding restitution in this action is not to collect a foreign
tax, but to mete out appropriate criminal punishment for
that conduct.
In any event, any conflict between mandatory restitution
and the revenue rule would not change our holding today.
If awarding restitution to foreign sovereigns were contrary
to the revenue rule, the proper resolution would be to con-
strue the Mandatory Victims Restitution Act not to allow
such awards, rather than to assume that the later enacted
restitution statute impliedly repealed § 1343 as applied to
frauds against foreign sovereigns.
2
We are no more persuaded by a second line of cases on
which petitioners rely. Petitioners analogize the present
case to early English common-law cases from which the reve-
nue rule originally derived. Those early cases involved con-
tract law, and they held that contracts executed with the
purpose of evading the revenue laws of other nations were
enforceable, notwithstanding the rule against enforcing con-
11 See 18 U. S. C. § 3663A(c)(1)(A)(ii) (“This section shall apply in all sen-
tencing proceedings for convictions of . . . an offense against property
under this title . . . including any offense committed by fraud or deceit”).

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tracts with illegal purposes. See Boucher v. Lawson, Cas.
T. Hard. 85, 89–90, 95 Eng. Rep. 53, 55–56 (K. B. 1734);
Planche v. Fletcher, 1 Dougl. 251, 99 Eng. Rep. 164 (K. B.
1779). Petitioners argue that these cases demonstrate that
“indirect” enforcement of revenue laws is at the very core of
the common-law revenue rule, rather than at its margins.
The argument is unavailing. By the mid-20th century, the
revenue rule had developed into a doctrine very different
from its original form. Early revenue rule cases were
driven by the interest in lessening the commercial disruption
caused by the high tariffs of the day. As Lord Hardwicke
explained, if contracts that aimed at circumventing foreign
revenue laws were unenforceable, “it would cut off all benefit
of such trade from this kingdom, which would be of very bad
consequence to the principal and most beneficial branches of
our trade.” Boucher, supra, at 89, 95 Eng. Rep., at 56. By
the 20th century, however, that rationale for the revenue
rule had been supplanted. By then, as we have explained,
courts had begun to apply the revenue rule to tax obligations
on the strength of the analogy between a country’s revenue
laws and its penal ones, see supra, at 360–361, superseding
the original promotion-of-commerce rationale for the rule.
Dodge, Breaking the Public Law Taboo, 43 Harv. Int’l L. J.
161, 178 (2002); Buchanan, 1955 A. C., at 522–524, 528–529.
The early English cases rest on a far different foundation
from that on which the revenue rule came to rest. They
thus say little about whether the wire fraud statute dero-
gated from the revenue rule in its mid-20th-century form.
3
Granted, this criminal prosecution “enforces” Canadian
revenue law in an attenuated sense, but not in a sense that
clearly would contravene the revenue rule. From its earli-
est days, the revenue rule never proscribed all enforcement
of foreign revenue law. For example, at the same time they
were enforcing domestic contracts that had the purpose of

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violating foreign revenue law, English courts also considered
void foreign contracts that lacked tax stamps required under
foreign revenue law. See Alves v. Hodgson, 7 T. R. 241, 243,
101 Eng. Rep. 953, 955 (K. B. 1797); Clegg v. Levy, 3 Camp.
166, 167, 170 Eng. Rep. 1343 (N. P. 1812). Like the present
prosecution, cases voiding foreign contracts under foreign
law no doubt “enforced” foreign revenue law in the sense
that they encouraged the payment of foreign taxes; yet they
fell outside the revenue rule’s scope. The line the revenue
rule draws between impermissible and permissible “enforce-
ment” of foreign revenue law has therefore always been
unclear.
The uncertainty persisted in American courts that recog-
nized the revenue rule. In one of the earliest appearances
of the revenue rule in America, the Supreme Court of New
Hampshire entertained an action that required extensive
recognition of a sister State’s revenue laws. Henry v. Sar-
geant, 13 N. H. 321 (1843). There, the plaintiff sought dam-
ages, alleging that a Vermont selectman had imposed an ille-
gal tax on him. Id., at 331. The court found that the
revenue rule did not bar the action, id., at 331–332, though
the suit required the court to enforce the revenue laws of
Vermont, see id., at 335–338.
Likewise, in In re Hollins, 79 Misc. 200, 139 N. Y. S. 713
(Sur. Ct.), aff ’d, 160 App. Div. 886, 144 N. Y. S. 1121 (1913),
aff ’d, 212 N. Y. 567, 106 N. E. 1034 (App. 1914) (per curiam),
the court held that an estate executor could satisfy foreign
taxes due on a decedent’s estate out of property of the estate,
notwithstanding a legatee’s argument that the revenue rule
barred authorizing such payments. 79 Misc., at 207–208, 139
N. Y. S., at 716–717. The court explained:
“While it is doubtless true that this court will not aid a
foreign country in the enforcement of its revenue laws,
it will not refuse to direct a just and equitable admin-
istration of that part of an estate within its jurisdic-
tion merely because such direction would result in the

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enforcement of such revenue laws.” Id., at 208, 139
N. Y. S., at 717.
These cases demonstrate that the extent to which the rev-
enue rule barred indirect recognition of foreign revenue laws
was unsettled as of 1952. Following the reasoning of In re
Hollins, for instance, Congress might well have thought that
courts would enforce the wire fraud statute, even if doing
so might incidentally recognize Canadian revenue law. The
uncertainty highlights that “[i]ndirect enforcement is . . .
easier to describe than to define,” and “it is sometimes diffi-
cult to draw the line between an issue involving merely rec-
ognition of a foreign law and indirect enforcement of it.” 1
A. Dicey & J. Morris, Conflict of Laws 90 (L. Collins gen. ed.
13th ed. 2000). Even if the present prosecution is analogous
to the indirect enforcement cases on which petitioners rely,
those cases do not yield a rule sufficiently well established
to narrow the wire fraud statute in the context of this crimi-
nal prosecution.
B
Having concluded that revenue rule jurisprudence is no
clear bar to this prosecution, we next turn to whether the
purposes of the revenue rule, as articulated in the relevant
authorities, suggest differently. They do not.
First, this prosecution poses little risk of causing the prin-
cipal evil against which the revenue rule was traditionally
thought to guard: judicial evaluation of the policy-laden en-
actments of other sovereigns. See, e. g., Moore v. Mitchell,
30 F. 2d 600, 604 (CA2 1929) (L. Hand, J., concurring). As
Judge Hand put it, allowing courts to enforce another coun-
try’s revenue laws was thought to be a delicate inquiry
“when it concerns the relations between the foreign
state and its own citizens . . . . To pass upon the provi-
sions for the public order of another state is, or at any
rate should be, beyond the powers of a court; it involves

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the relations between the states themselves, with which
courts are incompetent to deal, and which are intrusted
to other authorities.” Ibid.
The present prosecution creates little risk of causing inter-
national friction through judicial evaluation of the policies of
foreign sovereigns. This action was brought by the Execu-
tive to enforce a statute passed by Congress. In our system
of government, the Executive is “the sole organ of the fed-
eral government in the field of international relations,”
United States v. Curtiss-Wright Export Corp., 299 U. S. 304,
320 (1936), and has ample authority and competence to man-
age “the relations between the foreign state and its own citi-
zens” and to avoid “embarass[ing] its neighbor[s],” Moore,
supra, at 604 (L. Hand, J., concurring); see also Chicago &
Southern Air Lines, Inc. v. Waterman S. S. Corp., 333 U. S.
103, 111 (1948). True, a prosecution like this one requires
a court to recognize foreign law to determine whether the
defendant violated U. S. law. But we may assume that by
electing to bring this prosecution, the Executive has as-
sessed this prosecution’s impact on this Nation’s relationship
with Canada, and concluded that it poses little danger of
causing international friction. We know of no common-law
court that has applied the revenue rule to bar an action ac-
companied by such a safeguard, and neither petitioners nor
the dissent directs us to any. The greater danger, in fact,
would lie in our judging this prosecution barred based on the
foreign policy concerns animating the revenue rule, concerns
that we have “neither aptitude, facilities nor responsibility”
to evaluate. Ibid.
More broadly, petitioners argue that the revenue rule
avoids giving domestic effect to politically sensitive and con-
troversial policy decisions embodied in foreign revenue laws,
regardless of whether courts need pass judgment on such
laws. See Banco Nacional de Cuba v. Sabbatino, 376 U. S.
398, 448 (1964) (White, J., dissenting) (“[C]ourts customarily

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Opinion of the Court
refuse to enforce the revenue and penal laws of a foreign
state, since no country has an obligation to further the gov-
ernmental interests of a foreign sovereign”). This worries
us little here. The present prosecution, if authorized by the
wire fraud statute, embodies the policy choice of the two po-
litical branches of our Government—Congress and the Exec-
utive—to free the interstate wires from fraudulent use, irre-
spective of the object of the fraud. Such a reading of the
wire fraud statute gives effect to that considered policy
choice. It therefore poses no risk of advancing the policies
of Canada illegitimately.
Still a final revenue rule rationale petitioners urge is the
concern that courts lack the competence to examine the va-
lidity of unfamiliar foreign tax schemes. See, e. g., Leflar
218. Foreign law, of course, posed no unmanageable com-
plexity in this case. The District Court had before it uncon-
troverted testimony of a Government witness that petition-
ers’ scheme aimed at violating Canadian tax law. See App.
65–66.
Nevertheless, Federal Rule of Criminal Procedure 26.1 ad-
dresses petitioners’ concern by setting forth a procedure for
interpreting foreign law that improves on those available at
common law. Specifically, it permits a court, in deciding is-
sues of foreign law, to consider “any relevant material or
source—including testimony—without regard to the Federal
Rules of Evidence.” By contrast, common-law procedures
for dealing with foreign law—those available to the courts
that formulated the revenue rule—were more cumbersome.
See Advisory Committee’s Notes on Fed. Rule Crim. Proc.
26.1, 18 U. S. C. App., p. 1606 (noting that the rule improves
on common-law procedures for proving foreign law). Rule
26.1 gives federal courts sufficient means to resolve the inci-
dental foreign law issues they may encounter in wire fraud
prosecutions.

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IV
Finally, our interpretation of the wire fraud statute does
not give it “extraterritorial effect.” 12 Post, at 378 (Gins-
burg, J., dissenting). Petitioners used U. S. interstate
wires to execute a scheme to defraud a foreign sovereign of
tax revenue. Their offense was complete the moment they
executed the scheme inside the United States; “[t]he wire
fraud statute punishes the scheme, not its success.” United
States v. Pierce, 224 F. 3d 158, 166 (CA2 2000) (internal quo-
tation marks and brackets in original omitted); see Durland,
161 U. S., at 313 (“The significant fact is the intent and pur-
pose”). This domestic element of petitioners’ conduct is
what the Government is punishing in this prosecution, no
less than when it prosecutes a scheme to defraud a foreign
individual or corporation, or a foreign government acting as
a market participant. See post, at 379, n. 8 (Ginsburg, J.,
dissenting) (noting that such prosecutions of foreign individ-
uals, corporations, and governments are domestic applica-
tions of the wire fraud statute). 13 In any event, the wire
fraud statute punishes frauds executed “in interstate or for-
12 As some indication of the novelty of the dissent’s “extraterritoriality”
argument, we note that this argument was not pressed or passed upon
below and was raised only as an afterthought in petitioners’ reply brief,
depriving the Government of a chance to respond. Reply Brief for Peti-
tioners 17–18.
13 The dissent says that a scheme to defraud a foreign corporation or
individual “does not necessarily depend on any determination of foreign
law” and therefore “is of a different order.” Post, at 379, n. 8 (opinion of
Ginsburg, J.). That is not so. Many such schemes will necessarily re-
quire interpretation of foreign law. Without proof of foreign law, it is
impossible to tell whether the scheme had the purpose of depriving the
foreign corporation or individual of valuable property interests as defined
by foreign law. See supra, at 355–356; United States v. Pierce, 224 F. 3d
158, 165–168 (CA2 2000). The fact that a prosecution might involve for-
eign revenue law, rather than any other type of foreign law, is relevant to
whether such a prosecution is in derogation of the revenue rule, see supra,
at 359–370, not to whether it is “extraterritorial.”

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eign commerce,” 18 U. S. C. § 1343 (2000 ed., Supp. II), so this
is surely not a statute in which Congress had only “domestic
concerns in mind.” Small v. United States, post, at 388.
* * *
It may seem an odd use of the Federal Government’s re-
sources to prosecute a U. S. citizen for smuggling cheap liq-
uor into Canada. But the broad language of the wire fraud
statute authorizes it to do so, and no canon of statutory con-
struction permits us to read the statute more narrowly.
The judgment of the Court of Appeals is affirmed. 14
It is so ordered.
Justice Ginsburg, with whom Justice Breyer joins,
and with whom Justice Scalia and Justice Souter join
as to Parts II and III, dissenting.
This case concerns extension of the “wire fraud” statute,
18 U. S. C. § 1343 (2000 ed., Supp. II), to a scenario extrater-
ritorial in significant part: The Government invoked the stat-
ute to reach a scheme to smuggle liquor from the United
States into Canada and thereby deprive Canada of revenues
due under that nation’s customs and tax laws. Silent on its
application to activity culminating beyond our borders, the
statute prohibits “any scheme” to defraud that employs in
its execution communication through interstate or interna-
14 Petitioners argue in a footnote that their sentences should be vacated
in light of Blakely v. Washington, 542 U. S. 296 (2004). Brief for Petition-
ers 26, n. 29. Petitioners did not raise this claim before the Court of
Appeals or in their petition for certiorari. We therefore decline to ad-
dress it. See, e. g., Lopez v. Davis, 531 U. S. 230, 244, n. 6 (2001) (declining
to address “matter . . . not raised or decided below, or presented in the
petition for certiorari”); Whitfield v. United States, 543 U. S. 209 (2005)
(affirming federal convictions despite the imposition of sentence enhance-
ments, see Brief for Petitioners therein, O. T. 2004, No. 03–1293 etc., p. 7,
n. 6).

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tional wires. A relevant background norm, known as the
common-law revenue rule, bars suit in one country to enforce
another country’s tax laws.
The scheme at issue involves liquor purchased from dis-
count sellers in Maryland, trucked to New York, then smug-
gled into Canada to evade Canada’s hefty tax on imported
alcohol. 1 Defendants below, petitioners here, were indicted
under § 1343 for devising a scheme “to defraud the govern-
ments of Canada and the Province of Ontario of excise duties
and tax revenues relating to the importation and sale of liq-
uor.” App. to Pet. for Cert. 58a. Each of the six counts in
question was based on telephone calls between New York
and Maryland. Id., at 60a–64a.
The Court today reads the wire fraud statute to draw into
our courts, at the prosecutor’s option, charges that another
nation’s revenue laws have been evaded. The common-law
revenue rule does not stand in the way, the Court instructs,
for that rule has no application to criminal prosecutions
under the wire fraud statute.
As I see it, and as petitioners urged, Reply Brief 17–19,
the Court has ascribed an exorbitant scope to the wire fraud
statute, in disregard of our repeated recognition that “Con-
gress legislates against the backdrop of the presumption
against extraterritoriality.” See EEOC v. Arabian Ameri-
can Oil Co., 499 U. S. 244, 248 (1991) (ARAMCO); Small v.
United States, post, at 388–389 (The Court has “adopt[ed]
the legal presumption that Congress ordinarily intends its
statutes to have domestic, not extraterritorial, application.”);
Reply Brief 17, n. 23 (“This prosecution clearly gives the
wire fraud statute extraterritorial effect in that ‘[t]he actions
in [Canada] are . . . most naturally understood as the kernel
of ’ Petitioners’ alleged fraud.” (quoting Sosa v. Alvarez-
1 The Government offered a Canadian customs officer’s testimony at trial
that if alcohol is purchased for $56 per case in the United States, the
Canadian tax would be approximately $100 per case. App. 65–66; see
infra, at 376, n. 4.

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Ginsburg, J., dissenting
Machain, 542 U. S. 692, 700–701 (2004))). 2 Notably, when
Congress explicitly addressed international smuggling, see
18 U. S. C. § 546, it provided for criminal enforcement of the
customs laws of a foreign nation only when that nation has
a reciprocal law criminalizing smuggling into the United
States. Currently, Canada has no such reciprocal law.
Of overriding importance in this regard, tax collection in-
ternationally is an area in which treaties hold sway. See
Attorney General of Canada v. R. J. Reynolds Tobacco Hold-
ings, Inc., 268 F. 3d 103, 115–119 (CA2 2001) (referencing tax
treaties to which the United States is a party). There is a
treaty between the United States and Canada regarding the
collection of taxes, but that accord requires certification by
the taxing nation that the taxes owed have been “finally de-
termined.” See Protocol Amending the Convention with
Respect to Taxes on Income and on Capital, Sept. 26, 1980,
S. Treaty Doc. No. 104–4, 2030 U. N. T. S. 236, 245, Art. 15,
¶ 2 (entered into force Nov. 9, 1995) (hereinafter Protocol).
Moreover, the treaty is inapplicable to persons, like petition-
ers in this case, who are United States citizens at the time
that the tax liability is incurred. Id., at 246, Art. 15, ¶ 8.
2 Petitioners’ reliance on the presumption against extraterritorial appli-
cation of laws enacted with domestic concerns in mind was no mere after-
thought. See ante, at 371, n. 12. The presumption was explicitly fea-
tured in petitioners’ reply brief. See Reply Brief 17–19, and n. 23
(observing, inter alia, that the presumption against extraterritoriality “is
especially true when criminal liability is at stake”); see also Brief for Peti-
tioners 40, n. 46. Both parties ask us to determine the scope of § 1343,
and the presumption against extraterritoriality is a guide to interpretation
of the kind courts ordinarily bring to bear in endeavoring to discern the
meaning of a legislative text. Moreover, the Government’s responses to
petitioners’ revenue rule arguments coincide with the Government’s posi-
tion on the presumption against extraterritoriality. Compare Brief for
United States 22–26 with Tr. of Oral Arg. 35, 46–47 (responding to the
Court’s questions about extraterritoriality, counsel for the Government
asserted that Congress left to executive discretion the determination
whether “enforcement of [foreign] tax systems” is appropriate).

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375 Cite as: 544 U. S. 349 (2005)
Ginsburg, J., dissenting
Today’s novel decision is all the more troubling for its fail-
ure to take account of Canada’s primary interest in the mat-
ter at stake. United States citizens who have committed
criminal violations of Canadian tax law can be extradited to
stand trial in Canada. 3 Canadian courts are best positioned
to decide “whether, and to what extent, the defendants have
defrauded the governments of Canada and Ontario out of
tax revenues owed pursuant to their own, sovereign, excise
laws.” 336 F. 3d 321, 343 (CA4 2003) (en banc) (Gregory,
J., dissenting).
I
The Government’s prosecution of David Pasquantino, Carl
Pasquantino, and Arthur Hilts for wire fraud was grounded
in Canadian customs and tax laws. The wire fraud statute,
18 U. S. C. § 1343, required the Government to allege and
prove that the defendants engaged in a scheme to defraud a
victim—here, the Canadian Government—of money or prop-
erty. See ante, at 356 (describing Canada as the “victim” of
a scheme having “as its object the deprivation of Canada’s
‘property’ ”). To establish the fraudulent nature of the de-
fendants’ scheme and the Canadian Government’s entitle-
ment to the money withheld by the defendants, the United
States offered proof at trial that Canada imposes import du-
ties on liquor, and that the defendants intended to evade
those duties. See App. to Pet. for Cert. 58a; App. 65–74.
The defendants’ convictions for wire fraud therefore resulted
from, and could not have been obtained without proof of,
their intent to violate Canadian revenue laws. See United
States v. Pierce, 224 F. 3d 158, 166–168 (CA2 2000) (“If no
Canadian duty or tax actually existed, the [defendants] were
no more guilty of wire fraud than they would have been had
3 Indeed, the defendants have all been indicted in Canada for failing to
report excise taxes and possession of unlawfully imported spirits, 336 F. 3d
321, 343 (CA4 2003) (en banc) (Gregory, J., dissenting), but Canada has not
requested their extradition, see Tr. of Oral Arg. 12–13, 30.

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376 PASQUANTINO v. UNITED STATES
Ginsburg, J., dissenting
they used the wires” to smuggle liquor into New York City,
“in the sincere but mistaken belief that New York City im-
poses a duty on such . . . shipments.”).
The United States Government’s reliance on Canadian cus-
toms and tax laws continued at sentencing. The United
States Sentencing Guidelines mandated that the defendants
be sentenced on the basis of, among other things, the amount
by which the defendants defrauded the Canadian Govern-
ment. See United States Sentencing Commission, Guide-
lines Manual § 2F1.1(b)(1) (Nov. 2000). Accordingly, the Dis-
trict Court calculated the number of cases of liquor smuggled
into Canada and the aggregate amount of import duties
evaded by the defendants. The court concluded that the
Pasquantinos avoided over $2.5 million in Canadian duties,
and Hilts, over $1.1 million. See App. 97–101, 104–105. 4
The resulting offense-level increases yielded significantly
4 The casual manner in which the Government and the District Court
reached these totals detracts from the Court’s assertion that “[f]oreign
law, of course, posed no unmanageable complexity in this case.” Ante,
at 370. In making its sentencing recommendation to the court, the Gov-
ernment did not proffer evidence of the precise rate at which Canada taxes
liquor imports, or reference any provisions of Canadian law. Rather, it
relied on the trial testimony of an intelligence officer with Canadian Cus-
toms, who surmised, based on her experience in working at the border,
that Canadian taxes on a $56 case of liquor would be approximately $100.
See App. 104. The customs officer was not offered as an expert witness
and “[t]he [D]istrict [C]ourt never determined whether [her] calculations
were accurate as a matter of Canadian law.” 336 F. 3d, at 343 (Gregory,
J., dissenting). Thus, if foreign law posed no complexity in this case, it is
not because the parties and the court were easily able to interpret and
apply Canadian law, but rather because the Government and the court
made no serious attempt to do so. That no such effort was made here, in
derogation of the Government’s and the court’s shared obligation to ensure
that the calculations potentially affecting a defendant’s sentence are as
accurate as possible, is “deeply troubling,” ibid., and suggests that the
Government was unprepared to grapple with the details of foreign reve-
nue laws.

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377 Cite as: 544 U. S. 349 (2005)
Ginsburg, J., dissenting
longer sentences for the defendants. 5 As Judge Gregory
stated in dissent below, the fact that “the bulk of the defend-
ants’ sentences were related, not to the American crime of
wire fraud, but to the Canadian crime of tax evasion,” shows
that “this case was primarily about enforcing Canadian law.”
336 F. 3d, at 342–343.
Expansively interpreting the text of the wire fraud stat-
ute, which prohibits “any scheme or artifice to defraud, or
for obtaining money or property by means of . . . fraudulent
pretenses,” the Court today upholds the Government’s de-
ployment of § 1343 essentially to enforce foreign tax law.
This Court has several times observed that the wire fraud
statute has a long arm, extending to “everything designed
to defraud by representations as to the past or present, or
suggestions and promises as to the future.” Durland v.
United States, 161 U. S. 306, 313 (1896). But the Court has
also recognized that incautious reading of the statute could
dramatically expand the reach of federal criminal law, and
we have refused to apply the proscription exorbitantly. See
McNally v. United States, 483 U. S. 350, 360 (1987) (refusing
5 I note that petitioners’ sentences were enhanced on the basis of judicial
factfindings, in violation of the Sixth Amendment. See United States v.
Booker, 543 U. S. 220, 230–234 (2005) (Stevens, J., for the Court); see
also Blakely v. Washington, 542 U. S. 296 (2004). Despite the Court’s
affirmance of their convictions, therefore, petitioners may be entitled to
resentencing. See Booker, 543 U. S., at 268 (Breyer, J., for the Court).
The Court declines to address the defendants’ plea for resentencing, stat-
ing that “[p]etitioners did not raise this claim before the Court of Appeals
or in their petition for certiorari.” See ante, at 372, n. 14. This omission
was no fault of the defendants, however, as the petition in this case was
filed and granted well before the Court decided Blakely. Petitioners thus
raised Blakely at the earliest possible point: in their merits briefing. The
rule that we do not consider issues not raised in the petition is prudential,
not jurisdictional, see Izumi Seimitsu Kogyo Kabushiki Kaisha v. U. S.
Philips Corp., 510 U. S. 27, 32–33 (1993) (per curiam), and a remand on
the Blakely-Booker question would neither prejudice the Government nor
require this Court to delve into complex issues not passed on below.

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378 PASQUANTINO v. UNITED STATES
Ginsburg, J., dissenting
to construe 18 U. S. C. § 1341, the mail fraud statute, to reach
corruption in local government, stating: “[W]e read § 1341
as limited in scope to the protection of property rights. If
Congress desires to go further, it must speak more clearly
than it has.”); see also Cleveland v. United States, 531 U. S.
12, 24–25 (2000) (holding that § 1341 does not reach schemes
to make false statements on a state license application, in
part based on reluctance to “approve a sweeping expan-
sion of federal criminal jurisdiction in the absence of a clear
statement by Congress”). 6
Construing § 1343 to encompass violations of foreign reve-
nue laws, the Court ignores the absence of anything signal-
ing Congress’ intent to give the statute such an extraordi-
nary extraterritorial effect. 7 “It is a longstanding principle
of American law,” ARAMCO, 499 U. S., at 248, that Con-
gress, in most of its legislative endeavors, “is primarily con-
cerned with domestic conditions,” ibid. (quoting Foley Bros.,
Inc. v. Filardo, 336 U. S. 281, 285 (1949)). See also Small,
post, at 388 (interpreting the phrase “convicted in any
court,” 18 U. S. C. § 922(g)(1), in light of the “commonsense
notion” that Congress ordinarily intends statutes to have
only domestic application (quoting Smith v. United States,
507 U. S. 197, 204, n. 5 (1993))). Absent a clear statement of
“the affirmative intention of the Congress,” Benz v. Com-
pania Naviera Hidalgo, S. A., 353 U. S. 138, 147 (1957), this
Court ordinarily does not read statutes to reach conduct that
is “the primary concern of a foreign country,” Foley Bros.,
336 U. S., at 286; cf. F. Hoffmann-La Roche Ltd v. Empagran
6 I note that, on the Court’s interpretation, federal prosecutors could
resort to the wire and mail fraud statutes to reach schemes to evade not
only foreign taxes, but state and local taxes as well.
7 I do not read into § 1343’s coverage of frauds executed “in interstate
or foreign commerce,” ante, at 371–372, congressional intent to give § 1343
extraterritorial effect. A statute’s express application to acts committed
in foreign commerce, the Court has repeatedly held, does not in itself indi-
cate a congressional design to give the statute extraterritorial effect. See
ARAMCO, 499 U. S. 244, 250–253 (1991).

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379 Cite as: 544 U. S. 349 (2005)
Ginsburg, J., dissenting
S. A., 542 U. S. 155, 164 (2004) (referring to presumption that
“legislators take account of the legitimate sovereign inter-
ests of other nations when they write American laws”).
Section 1343, which contains no reference to foreign law
as an element of the domestic crime of wire fraud, contrasts
with federal criminal statutes that chart the courts’ course
in this regard. See, e. g., 18 U. S. C. § 1956(c)(1) (defendant
must know that transaction involved the proceeds of activity
“that constitutes a felony under State, Federal, or foreign
law”); 16 U. S. C. § 3372(a)(2)(A) (banning importation of
wildlife that has been “taken, possessed, transported, or sold
in violation of any . . . foreign law”). These statutes indicate
that Congress, which has the sole authority to determine the
extraterritorial reach of domestic laws, is fully capable of
conveying its policy choice to the Executive and the courts.
I would not assume from legislative silence that Congress
left the matter to executive discretion. 8
The presumption against extraterritoriality, which guides
courts in the absence of congressional direction, provides
ample cause to conclude that § 1343 does not extend to the
instant scheme. Moreover, as to foreign customs and tax
laws, there is scant room for doubt about Congress’ general
8 The application of 18 U. S. C. § 1343 (2000 ed., Supp. II) to schemes to
defraud a foreign individual or corporation, or even a foreign governmen-
tal entity acting as a market participant, is of a different order, and does
not necessarily depend on any determination of foreign law. As the Court
of Appeals observed in United States v. Boots, 80 F. 3d 580, 587 (CA1
1996), upholding a defendant’s wire fraud conviction in a case like the one
here presented “would amount functionally to penal enforcement of Cana-
dian customs and tax laws.” See also ibid. (noting that courts “will en-
force foreign non-tax civil judgments unless due process, jurisdictional, or
fundamental public policy considerations interfere” (citing Restatement
(Third) of Foreign Relations Law of the United States § 483, and Report-
ers’ Notes, n. 1 (1986)), but “[o]ur courts customarily refuse to enforce the
revenue and penal laws of a foreign state, since no country has an obliga-
tion to further the governmental interests of a foreign sovereign” (quoting
Banco Nacional de Cuba v. Sabbatino, 376 U. S. 398, 448 (1964) (White,
J., dissenting))).

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380 PASQUANTINO v. UNITED STATES
Ginsburg, J., dissenting
perspective: Congress has actively indicated, through both
domestic legislation and treaties, that it intends “strictly [to]
limit the parameters of any assistance given” to foreign na-
tions. Attorney General of Canada v. R. J. Reynolds To-
bacco Holdings, Inc., 268 F. 3d, at 119; see also United States
v. Boots, 80 F. 3d 580, 588 (CA1 1996) (“National [foreign]
policy judgments . . . could be undermined if federal courts
were to give general effect to wire fraud prosecutions for . . .
violating the revenue laws of any country.”).
First, Congress has enacted a specific statute criminalizing
offenses of the genre committed by the defendants here: 18
U. S. C. § 546 prohibits transporting goods “into the territory
of any foreign government in violation of the laws there in
force.” Section 546’s application, however, is expressly con-
ditioned on the foreign government’s enactment of reciprocal
legislation prohibiting smuggling into the United States.
See ibid. (prohibition applies “if under the laws of such for-
eign government any penalty or forfeiture is provided for
violation of the laws of the United States respecting the cus-
toms revenue”). The reciprocity limitation reflects a legisla-
tive determination that this country should not provide other
nations with greater enforcement assistance than they give
to the United States. The limitation also cabins the Govern-
ment’s discretion as to which nation’s customs laws to en-
force, thereby avoiding the appearance of prosecutorial over-
reaching. See 305 F. 3d 291, 297, n. 9 (CA4 2002) (Gregory,
J.) (“Where do we draw the line as to which countries’ laws
we will help enforce?”), vacated and reh’g en banc granted,
2003 U. S. App. LEXIS 585, *1 (CA4, Jan. 14, 2003). Sig-
nificantly, Canada has no statute criminalizing smuggling
into the United States, rendering § 546 inapplicable to
schemes resembling the one at issue here. 9
9 Section 546’s requirement that a vessel have been used to transport
the goods to the foreign country would render § 546 inapplicable to these
defendants’ conduct in any event.

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381 Cite as: 544 U. S. 349 (2005)
Ginsburg, J., dissenting
Second, the United States and Canada have negotiated,
and the Senate has ratified, a comprehensive tax treaty, in
which both nations have committed to providing collection
assistance with respect to each other’s tax claims. See Pro-
tocol Art. 15. Significantly, the Protocol does not call upon
either nation to interpret or calculate liability under the oth-
er’s tax statutes; it applies only to tax claims that have been
fully and finally adjudicated under the law of the requesting
nation. Further, the Protocol bars assistance in collecting
any claim against a citizen or corporation of “the requested
State.” Id., at 246, Art. 15, ¶ 8(a). These provisions would
preclude Canada from obtaining United States assistance
in enforcing its claims against the Pasquantinos and Hilts.
I would not assume that Congress understood § 1343 to pro-
vide the assistance that the United States, in the considered
foreign policy judgment of both political branches, has spe-
cifically declined to promise.
II
Complementing the principle that courts ordinarily should
await congressional instruction before giving our laws extra-
territorial thrust, the common-law revenue rule holds that
one nation generally does not enforce another’s tax laws.
See Banco Nacional de Cuba v. Sabbatino, 376 U. S. 398, 448
(1964) (White, J., dissenting) (noting that “our courts custom-
arily refuse to enforce the revenue and penal laws of a for-
eign state”); cf. Milwaukee County v. M. E. White Co., 296
U. S. 268, 275–276 (1935). The Government argues, and the
Court accepts, that domestic wire fraud prosecutions prem-
ised on violations of foreign tax law do not implicate the
revenue rule because the court, while it must “recognize for-
eign [revenue] law to determine whether the defendant vio-
lated U. S. law,” ante, at 369, need only “enforce” foreign law
“in an attenuated sense.” See ante, at 366; Brief for United
States 17–19. As discussed above, however, the defendants’
conduct arguably fell within the scope of § 1343 only because

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382 PASQUANTINO v. UNITED STATES
Ginsburg, J., dissenting
of their purpose to evade Canadian customs and tax laws;
shorn of that purpose, no other aspect of their conduct was
criminal in this country. See supra, at 375–377; Boots, 80
F. 3d, at 587 (“[U]pholding defendants’ section 1343 convic-
tion would amount . . . to penal enforcement of Canadian
customs and tax laws.”). It seems to me unavoidably obvi-
ous, therefore, that this prosecution directly implicates the
revenue rule. It is equally plain that Congress did not en-
deavor, by enacting § 1343, to displace that rule.
The application of the Mandatory Victims Restitution Act
of 1996, 18 U. S. C. § 3663A, to wire fraud offenses is corrobo-
rative. Section 3663A applies to all “offense[s] against prop-
erty,” § 3663A(c)(1)(A)(ii), and directs that “[n]otwithstand-
ing any other provision of law . . . the court shall order . . .
that the defendant make restitution to the victim of the
offense,” § 3663A(a)(1) (emphasis added). The Government
acknowledges, however, that it “did not urge the district
court to order restitution in this case on the theory that it
was not ‘appropriate . . . since the victim is a foreign govern-
ment and the loss derives from tax laws of the foreign gov-
ernment.’ ” Brief for United States 19–20 (quoting Letter
from United States Attorney S. Schenning to United States
District Chief Judge J. Motz, Feb. 16, 2001, App. 106). The
Government now disavows this concession. See Tr. of Oral
Arg. 36 (While “the prosecutor did concede below that resti-
tution was not appropriately ordered,” it is in fact “[t]he posi-
tion of the United States . . . that restitution under the man-
datory statute should be ordered and it does not infringe
the revenue rule.”). Nevertheless, the very fact that the
Government effectively invited the District Court to over-
look the mandatory restitution statute out of concern for
the revenue rule is revealing. It further demonstrates that
the Government’s expansive reading of § 1343 warrants this
Court’s disapprobation.
Any tension between § 3663A and the wire fraud statute,
the Government suggests and the Court accepts, would be

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383 Cite as: 544 U. S. 349 (2005)
Ginsburg, J., dissenting
relieved if this Court construed § 3663A to exclude restitu-
tion that might encounter a revenue rule shoal. See ante,
at 365; Brief for United States 21. Congress, however, has
expressed with notable clarity a policy of mandatory restitu-
tion in all wire fraud prosecutions. In contrast, Congress
was “quite ambiguous” concerning § 1343’s coverage of
schemes to evade foreign taxes. Tr. of Oral Arg. 38. The
Mandatory Victims Restitution Act, in my view, is an addi-
tional indicator that “Congress . . . [did not] envision foreign
taxes to be the object of [a] scheme to defraud,” id., at 35–36,
and I would construe § 1343 accordingly.
III
Finally, the rule of lenity counsels against adopting the
Court’s interpretation of § 1343. It is a “close ques-
tion” whether the wire fraud statute’s prohibition of “any
scheme . . . to defraud” includes schemes directed solely at
defrauding foreign governments of tax revenues. See id.,
at 33. We have long held that, when confronted with “two
rational readings of a criminal statute, one harsher than the
other, we are to choose the harsher only when Congress has
spoken in clear and definite language.” McNally, 483 U. S.,
at 359–360; see United States v. Universal C. I. T. Credit
Corp., 344 U. S. 218, 221–222 (1952).
This interpretive guide is particularly appropriate here.
Wire fraud is a predicate offense under the Racketeer In-
fluenced and Corrupt Organizations Act (RICO), 18 U. S. C.
§ 1961(1) (2000 ed., Supp. II), and the money laundering
statute, § 1956(c)(7)(A) (2000 ed.). See Cleveland, 531 U. S.,
at 25. A finding that particular conduct constitutes wire
fraud therefore exposes certain defendants to the severe
criminal penalties and forfeitures provided in both RICO,
see § 1963 (2000 ed.), and the money laundering statute,
§ 1956(a), (b) (2000 ed. and Supp. II).
* * *

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384 PASQUANTINO v. UNITED STATES
Ginsburg, J., dissenting
For the reasons stated, I would hold that § 1343 does not
extend to schemes to evade foreign tax and customs laws.
I would therefore reverse the judgment of the Court of
Appeals.