Prohibitions and Penalties Under Section 582 of the 1990 Foreign Operations, Export Financing, and Related Programs Appropriations Act ( 1990 )

Prohibitions and Penalties Under Section 582 of the 1990
Foreign Operations, Export Financing, and Related Programs
Appropriations Act
S e c tio n 5 8 2 o f th e 1 9 9 0 F oreign O p e ra tio n s , E x p o r t F in a n c in g , an d R e la te d P ro g ra m s A p p ro ­
p r ia tio n s A c t p ro h ib its only th e fo llo w in g : an e x p lic it q u id p ro q u o a rra n g e m e n t p u rs u a n t to
w h ic h b o th th e U n ite d States a n d a n o th e r g o v e rn m e n t o r p e rso n th a t is to re c e iv e fin a n c ia l
a s s is ta n c e fro m th e U n ite d S ta te s ag re e th a t re c e ip t o f th e a ss is ta n c e is e x p re s s ly c o n d itio n e d
u p o n th e r e c ip ie n t u n d e rta k in g a n a ctio n th a t th e U n ite d S ta te s w o u ld b e s p e c ific a lly p ro h ib ­
ite d b y U n ite d S ta te s law from c a r ry in g o u t.
N e ith e r v io la tio n o f s e c tio n 582, n o r c o n sp ira c y to v io la te s e c tio n 5 8 2 . is p u n is h a b le a s a c rim i­
n a l o ffe n s e .
April 16, 1990
M e m o r a n d u m O p in io n f o r t h e L e g a l A d v is e r
D e pa r tm en t o f State
This memorandum responds to your request for our opinion on (1) the
scope of the prohibition in section 582 of Public Law No. 101-167, 103 Stat.
1195, 1251 (1989), the Foreign Operations, Export Financing, and Related
Programs Appropriations Act, 1990, and (2) whether violation of or con­
spiracy to violate section 582 is punishable as a criminal offense. We
conclude, as did your office,1 that section 582 prohibits only an explicit quid
pro quo arrangement pursuant to which both the United States and another
government or person that is to receive financial assistance from the United
States agree that receipt of the assistance is expressly conditioned upon the
recipient undertaking an action that the United States would be specifically
prohibited by United States law from carrying out. As to the second ques­
tion, we also concur in your conclusion that Congress did not intend to
punish criminally either violation o f or conspiracy to violate section 582.
I.
The first version of the Foreign Operations, Export Financing, and Re­
lated Programs Appropriations Act, 1990 (“the Act”) passed by Congress
1 L e tte r fo r W illia m P. Barr, A ssista n t A ttorney G en eral, O ffice o f Legal C ounsel, from A braham D.
S o fae r, L e g a l A d v iser, U nited S tates D ep artm en t o f State (Jan. 19, 1990).
84
was H.R. 2939, 101st Cong., 1st Sess. (1989). President Bush vetoed that
measure on November 19, 1989, see 2 Pub. Papers of George Bush 1545
(Nov. 19, 1989), in large part because of constitutional concerns with the
version of section 582 that appeared in that Act. Id. Two days later, on
November 21, 1989, Congress passed that Act in its current form, specifi­
cally to address the A dm inistration’s concerns that had prom pted the
President’s veto. See, e.g., 135 Cong. Rec. S16,332 (daily ed. Nov. 20,
1989) (statement of Sen. Leahy); id. at H9088 (statement of Rep. Obey).
Section 582(a) of the Act provides as follows:
None of the funds appropriated by this Act may be provided
to any foreign government (including any instrumentality or
agency thereof), foreign person, or United States person in
exchange for that foreign government or person undertaking
any action which is, if carried out by the United States Gov­
ernment, a United States official or employee, expressly
prohibited by a provision of United States law.
103 Stat. at 1251. It is clear from this and the remaining provisions of
section 5822 that the section was intended to be only a narrow appropriation
limitation, not a criminal prohibition. Congressman Edwards explained the
purpose of the section in this way:
What we prohibit in this bill is a quid pro quo which would
allow the money we are appropriating here for the United
States’ foreign policy purposes to be provided to another gov­
ernment or person in exchange for that government or person
agreeing to do something which, if it were done by an Ameri­
can citizen or by our Government, would be a violation of
U.S. law. That is all it does. It prohibits a quid pro quo.
2Section 58 2 (b ) and (c) provides:
(b) F o r the p u rposes o f this sectio n the term “funds ap p ro p riated by th is A ct” in c lu d e s
only (1 ) assistance o f any kind un d er the F oreign A ssistance A ct o f 1961; and (2) cred its,
and g u aran ties un d er the Arms E x p o rt C ontrol Act.
(c) N o th in g in th is sectio n sh all be construed to lim it —
(1 ) the ability o f the President, the Vice P resident, o r any official o r e m ployee o f the
U nited States to m ake statem en ts or otherw ise express th e ir view s to any party o n any
subject;
(2) the a b ility o f an official o r em ployee o f the U nited States to e xpress the p o lic ie s o f
the President; o r
(3 ) the ability o f an official o r em ployee o f the U nited S tates to com m unicate w ith any
foreign country g o vernm ent, g ro u p o r individual, either d irectly or thro u g h a third party,
w ith respect to the p rohibitions o f this section including the reasons fo r such p ro h ib i­
tio n s, and the a ctio n s, term s, o r c o n d itio n s w hich m ight lead to the rem oval o f the
pro h ib itio n s o f this section.
103 Stat. a t 1251.
85
135 Cong. Rec. H9089 (daily ed. Nov. 20, 1989). By its terms, section
582(a) applies only to funds appropriated by the Act; unlike other similar
provisions, section 582 does not purport to restrict in any manner funds that
are appropriated by other acts.3 Section 582 is further limited by the restric­
tive definition of “funds” in subsection (b) and the additional interpretive
restrictions imposed by subsection (c). Thus, for example, subsection (c) —
despite the prohibition in subsection (a) — explicitly permits an employee
o f the United States to express the view to another government that it should
undertake an action that would be prohibited by United States law, because
“nothing” in section 582 “shall be construed to limit the ability of . . . [any]
employee o f the United States to . . . express their views to any party on any
subject.” And the restriction extends only through fiscal year 1990.4
Perhaps the most significant substantive term in the provision is “in ex­
change for” in subsection (a), and this term was the subject of considerable
discussion in the legislative history. It is evident that this language was
intended as a significant limitation on what otherwise might be read as
prohibited under this section.
Senators Cystine and Rudman engaged in an extended colloquy to clarify
the meaning o f the phrase. Senator Rudman explained:
It is not Congress’ intent in approving this amendment to cre­
ate a trap for the unwary. Accordingly, there is no intent to
prohibit the provision of U.S. assistance where, coinciden­
tally, the recipient undertakes an action that the United States
itself is prohibited to carry out. Therefore, the words “in
exchange for” in the [section] must be understood to require
an agreement between the United States and the aid recipient
under which, as an express condition for receiving the U.S.
assistance, the recipient undertakes an action which the United
States itself is prohibited to carry out.
135 Cong. Rec. S 16,363 (daily ed. Nov. 20, 1989).
Notably, earlier the same day, Senator Kasten had introduced a substitute
version o f section 582(a) to clarify that the subsection was only to apply to
3See, e.g., section 4 0 3 o f Public L a w No. 101 -45, tit. IV, 103 S tat. 97, 128 (19 8 9 ) (“N o funds a p p ro ­
p ria te d u n d e r this A ct o r any other A c t shall be a v ailab le to the B ureau o f A lcohol, T obacco and F ire ­
a rm s fo r th e e n fo rc e m e n t” o f various la w s.); section 303 o f Public L aw No. 98-3 9 6 , 98 Stat. 1369, 1422
(1 9 8 4 ) ( “N o n e o f the fu n d s made a v aila b le to the U n ite d States P ostal S ervice u n d e r this A ct or any
other A ct m ay b e u sed to restructure em p lo y ee c o m p en sation p ractices as in effe c t u n d e r the m ost
re c e n tly e ffe c tiv e c o lle ctiv e bargaining agreem ent. . . .” ) (em phasis added).
A d d itio n a lly , by its te rm s, the sec tio n is violated o n ly w here the specified funds are p rovided and the
re c ip ie n t g o v e rn m e n t o r person a ctu ally undertakes th e action that w ould be p ro h ib ited u n d e r the law o f
th e U n ite d S ta te s. T h u s, a request by a U nited States o fficial that the g o vernm ent o r person undertake
th a t a ctio n is, in itse lf, insufficient to im p licate the pro h ib itio n o f the section.
86
“an actual quid pro quo,” “pursuant to an agreement under which, as an
express condition for receipt of such assistance, the recipient is required to
take the prohibited action.” The proposed amendment provided:
None of the funds appropriated for assistance by this Act
may be provided to any foreign government (including any
instrumentality or agency thereof), foreign person, or United
States persons pursuant to an agreement under which, as an
express condition for receipt of such assistance, the recipient
is required to fund or carry out a military or foreign policy
activity which is expressly prohibited by a provision of United
States law.
Id. at S I6,361. Following his colloquy with Senator Rudman clarifying that
section 582(a) as drafted was indeed intended by Congress only to apply to
such a narrow class of circumstances, Senator Kasten withdrew his amend­
ment. Id. at S I6,361-63.
Congressman Obey, the chairman of the House subcommittee responsible
for the Act and one of the drafters of section 582, similarly stated that “the
word ‘exchange’ should be understood to refer to a direct verbal or written
agreement.” Id. at H9231 (daily ed. Nov. 21, 1989). As noted above, Con­
gressm an E dw ards, the ranking R epublican m em ber of the H ouse
subcommittee and another of the drafters of section 582, declared that sec­
tion 582 was designed to prohibit only quid pro quo arrangements. Id. at
H9089 (daily ed. Nov. 20, 1989). President Bush in his signing statement
accompanying the Act also stated:
I agree with the view expressed on the House and Senate
floor that this section is intended only to prohibit “quid pro
quo” transactions — that is, transactions in which U.S. funds
are provided to a foreign nation on the express condition that
the foreign nation provide specific assistance to a third coun­
try, which assistance U.S. officials are expressly prohibited
from providing by U.S. law. As reflected both in Congress­
man Edwards’ statements and in the explanatory colloquy
between Senators Kasten and Rudman, a “quid pro quo” ar­
rangement requires that both countries understand and agree
that U.S. aid will not be provided if the foreign government
does not provide the specific assistance.
It is important to note that Section 582 does not affect the
ability of the executive branch to urge any course of action
upon a foreign government or any third party. In addition, the
section applies only where there is a provision of U.S. law
87
that “expressly prohibits” the United States Government, or a
U.S. official or employee, from undertaking a particular ac­
tion, and thus would not apply to provisions that merely limit
funding to undertake such an action.
In these and other key respects, Section 582 is substantially
narrower than a related provision that prompted my veto of
H.R. 2939 on November 19, 1989.
2 Pub. Papers of George Bush 1573-74 (Nov. 21, 1989).
It is clear from the foregoing that the term “in exchange for” was pur­
posely chosen to ensure prohibition of only explicit quid pro quo arrangements
pursuant to which both the United States and the recipient nation(s) intend
and agree, verbally or in writing, that receipt of United States assistance is
expressly conditioned upon the recipient undertaking an action that the United
States would be specifically prohibited by United States law from carrying
out. We believe that the section should be interpreted and applied consis­
tently with this purpose.
II.
You also requested our opinion on whether either violation of section 582
or conspiracy to violate that provision could give rise to criminal penalties.
We believe that it is clear that Congress intended that neither violation of nor
conspiracy to violate the section would be punished criminally.
Section 582 contains no criminal penalties for its violation, nor does it
incorporate by reference any penalties existing under criminal (or any other)
law. If Congress had intended to render United States officials — including
the President him self — potentially criminally liable under the section, it
may fairly be assumed that this intention would have been evident from the
face o f the statute. See, e.g., United States v. Campos-Serrano, 404 U.S.
293, 297 (1971) (a defendant ‘“ is not to be subjected to a penalty unless the
words of the statute plainly impose it,’” (quoting Keppel v. Tiffin Savings
Bank, 197 U.S. 356, 362 (1905))). In fact, by Senate amendment, the State
Departm ent Authorization Act of FY 1990 that the President vetoed con­
tained a leveraging provision that had expressly included criminal penalties.5
Thus, there can be little question that when it passed section 582 without
s See H .R . 1487, 101st C o n g ., 1st S ess. § 109 (1 989). Section 109 w ould have am ended the Foreign
A ss is ta n c e A c t o f 1961 to provide in p art:
(a) P ro h ib itio n . — (1 ) W henever any pro v isio n o f U nited States law ex p ressly re fe rs to
th is sec tio n an d e x p re ssly p rohibits all U nited S tates assistance, or all assistan ce u n d e r a
C o n tin u ed
88
providing for criminal penalties, the Congress purposely chose not to crim i­
nally punish violations of section 582.
This intention is confirmed by the legislative history. Senator Rudman
stated unequivocally that “[section 582] does not contain criminal penal­
ties.” 135 Cong. Rec. S 16,362 (daily ed. Nov. 20, 1989); id. (section 582
“contains no criminal sanctions”). He observed: “If a criminal penalty were
intended, it would have been provided on the face of the provision. In the
absence of such a provision, it should be understood that Congress intends
that no criminal penalties will apply to the [section].” Id. Senator Moynihan
had introduced legislation similar to section 582 that would have explicitly
provided for criminal penalties. Id. Accordingly, we conclude that Con­
gress did not intend to, nor did it impose criminal penalties for violation of
section 582.6
That Congress chose not to criminalize violations of section 582 does not
necessarily mean that it did not intend to punish criminally, under 18 U.S.C.
§ 3 7 1,7 a conspiracy to violate the provision. It is clear also, however, that
’ (....co n tin u ed )
specified U nited States assistance account, from being provided to any specified foreign re ­
gion, country, g o vernm ent, group, o r individual for all o r specified a ctivities, then n o o fficer
o r em p lo y ee o f the E x ecu tiv e branch m ay —
(B ) use any U nited States funds o r facilities to assist any transaction w hereby a foreign
g o v ernm ent (in clu d in g any in stru m en tality o r agency thereof), foreign person, o r U nited
States person p ro v id es any fu n d s o r property to any third party . . . .
if the pu rp o se o f any such act is the furthering o r carrying out o f the sam e activ ities, w ith
respect to that region, country, g o vernm ent, g roup, or individual, for w hich U n ite d States
assistance is expressly prohibited ;
(b) Penalty. — A ny p erso n w ho know ingly and w illfully v iolates the provision o f subsec­
tion (a)(1) shall be im p riso n ed not m ore than S years o r fined in accordance w ith title 18.
U nited S tates C ode, o r both.
S e n a to r M oy n ih an noted in debate on section 582 that section 109, the e x p licit c rim in al le veraging
prov isio n , “ is not before us tonight. It is part o f the State D epartm ent authorization bill. Should it not
b eco m e law in this session . . . w e w ill retu rn to this m atter in the next o n e." 135 C ong. R ec. S I 6,362
(d a ily ed. Nov. 20, 1989). T h is com m ent, com ing im m ediately after S enator R u d m a n ’s statem en t that
sectio n 582 “d o es not contain crim inal p enalties,” w e believe is best u nderstood as S e n a to r M o y n ih a n 's
acq u iescen ce in w hat by th a t tim e appeared to be the S e n a te 's con clu sion th at crim inal p enalties w ould
not attach.
‘ C ong ressm an O bey, the principal d raftsm an o f section 582, never stated that violation o f the pro v isio n
w ould be p u nishable crim inally. Even a fte r attention had been focused on the sp ecific question o f p o s­
sib le crim inal penalties u n d e r the p rovision, he com m ented only that the provision “ is not an a tte m p t to
ham strin g g o vernm ent o fficials in the course o f their norm al duties o r to m ake them v ulnerable to w a y ­
w ard or runaw ay p ro secu to rs.” 135 C ong. Rec. H 9 2 3 1 (daily ed. Nov. 2 1 ,1 9 8 9 ).
’ S ectio n 371 provides:
If tw o o r more p erso n s co n sp ire eith e r to co m m it any offense against the U nited States, o r
to d efrau d the U nited States, o r any agency th e re o f in any m anner or for any purpose, and
one o r m ore persons d o any act to effect the o bject o f the conspiracy, each shall be fined not
m ore than $10,000 o r im prisoned not m ore than five years, o r both.
If, how ever, the offen se, the com m ission o f w hich is the object o f the conspiracy, is a
m isd em ean o r only, th e punishm ent for such con sp iracy shall not exceed the m axim um p u n ­
ishm ent pro v id ed fo r su ch m isdem eanor.
89
Congress did not intend for the general conspiracy statute to apply to con­
duct proscribed by section 582. In fact, Congress considered potential
applicability o f 18 U.S.C. § 371, and determined that it would not apply to
violations of section 582. On November 20, 1989, Senators Kasten and
Rudman specifically discussed on the floor of the Senate the fact that the
general conspiracy statute would have no applicability to section 582:
Mr. Kasten. I note that section 582 . . . does not provide a
criminal penalty for violation of its leveraging prohibition.
Does this indicate congressional intent that there be no crimi­
nal penalty for violation of section 582?
Mr. Rudman. Yes Senator, that is my understanding. If a
criminal penalty were intended, it would have been provided
on the face of the provision. In the absence of such a provi­
sion, it should be understood that Congress intends that no
criminal penalties will apply to the [section]. In particular, it
should be understood that the criminal conspiracy statute will
not apply to the [section].
Mr. Kasten. I want the record to reflect that my support for
section 582 is conditioned on the clarifications that [the] Sena­
tor has provided. I could not vote for this bill if I believed
that section 582 could provide a basis for criminal liability
. . . . I know that many Senators on my side of the aisle share
this view.
Mr. Rudman. I fully agree with this interpretation of section
582, and I know that the votes of many Senators are similarly
conditioned.
135 Cong. Rec. S16,362-63 (daily ed. Nov. 20, 1989) (emphasis added).
Immediately afterwards, Senator Dole concurred that section 582 should not
be interpreted as giving rise to any criminal penalties:
We cannot have lawful, but confident and creative, handling
o f our foreign policy — if every administration official hereafter
is always looking over his shoulder to see if some aggressive
special prosecutor — out to get his name in the headlines —
might be concocting some fanciful charge based on vague language.
90
Id. at S 16,363.® Senator Rudman explained the rationale for not imposing
criminal penalties:
The absence of a criminal penalty reflects the fact that the
leveraging prohibition is to apply across-the-board to essen­
tially all existing prohibitions on U.S. assistance. Without
individually examining these prohibitions to determine whether,
in the context of each prohibition, a criminal penalty for le­
veraging would be appropriate, it would be unwise for Congress
to apply such a penalty across-the-board.
Id.President Bush signed the bill into law on this understanding that neither
violation of section 582, nor conspiracy to violate the section, would be
criminally punishable:
Consistent with the expressed intent of the Congress and to
avoid constitutional problems, I intend to construe this sec­
tion [section 582] narrowly . . . . The Senate record also
makes clear that neither the criminal conspiracy statute, nor
any other criminal penalty, will apply to any violation of this
section. My decision to sign this bill is predicated on these
understandings of Section 582.
2 Pub. Papers of George Bush 1573 (Nov. 21, 1989).9 Thus, there appears to
have been consensus agreement that the general conspiracy provisions of 18
'C o n s is te n t w ith the view that C ongress did not intend v io latio n s of, or conspiracies to vio late sectio n
5 82 to b e c rim in ally punishable. S en ato r Leahy described sectio n 582 as “a bipartisan re v isio n [of th e
e a rlie r version o f sectio n 582 v etoed by P resident B ush] do n e by C o n gressm en O bey a n d E dw ards to
m ake it m ore accep tab le to the a d m in istratio n .” 135 C ong. R ec. S16.332 (d a ily ed. N ov. 20, 1989).
T h e A d m in istratio n had earlier n o tified C ongress that the p re d e ce sso r version o f section 5 8 2 w as u n a c ­
c ep tab le , inter alia , precisely because the th reat o f crim inal p ro secu tions u n d e r that v e rsio n “w ou ld
cle arly h av e a negative im pact on the conduct o f foreign re la tio n s.” L etter fo r C ongressm an Jaim ie L.
W hitten, C hairm an, H o u se C om m ittee on A ppropriations, from C aro l T. C raw ford, A ssista n t A ttorney
G e n eral, O ffice o f L eg islativ e A ffairs, at 2 n.2 (Nov. 1, 1989). S en ator D ole had a lso inform ed the
S en ate, p rio r to p assag e o f the A ct, that “S en io r W hite H ouse officials have told me th a t they w ould
advise the P resid en t to veto the bill unless this m atter [the scope o f section 582, including the q u estion
o f c rim in al penalties] is satisfacto rily clarified ." 135 C ong. R ec. S 16,363 (daily ed. Nov. 20 , 1989).
’ T he P resid e n t’s c o n stru ctio n o f section 582 in his signing statem en t is particularly im p o rtan t in th is
co n tex t. T h e P resid en t’s interpretation o f the section c o n stitu tes h is in struction, as head o f the e x e c u ­
tiv e branch , on im plem entation o f the section — an instru ctio n w ith w hich this D epartm ent, charged
w ith c rim in a l law enfo rcem ent, m u st comply. C ourts p roperly lo o k to presidential sig n in g statem ents
to assist in the in terp retatio n o f statutes. See. e.g.. Berry v. Department o f Justice, 7 33 F.2d 1343,
1349-50 (9 th Cir. 1984).
91
U.S.C. § 371 would have no applicability to section 582. Indeed, there is no
evidence whatever to the contrary.10
In U nited States v. Hutto, 256 U.S. 524, 528-29 (1921), the Supreme
Court held that a defendant could be indicted for criminal conspiracy to
commit an offense against the United States11 even where the predicate of­
fense was not itself criminally punishable. There, the underlying offense
was punishable by a civil penalty. It may be that conspiring to violate any
federal law — even a law that itself contains no criminal or civil penalties
— may be criminally punishable under 18 U.S.C. § 371 as a conspiracy to
commit an offense against the United States.12 We need not determine here,
however, the full reach of the principle announced in Hutto. The availability
of section 371 will always be a question of legislative intent. See, e.g.,
U nited States v. Universal C.I.T. Credit Corp., 344 U.S. 218, 221-22 (1952).
Thus, where, as here, there is affirmative, uncontradicted evidence that Con­
gress considered the question and intended that criminal penalties under
section 371 not be available, that section may not be invoked to impose such
a penalty.13 Accordingly, we conclude that a conspiracy to violate section
10 Compare 42 U .S .C . § 3795b (explicitly providing th a t the program s and p rojects in that c h a p te r “ shall
b e su b je c t to th e p ro v isio n s o f section 371 o f Title 18").
" In H utto, th e d e fe n d an ts were c h a rg e d w ith v io la tio n o f section 37, C rim inal C ode, w hich w as in
su b sta n c e id e n tic al to 18 U .S.C . § 371. S ectio n 37 p ro v id ed : “ If tw o o r more p e rso n s conspire e ith e r to
c o m m it any o ffen se a g ain st the U nited S ta te s, or to d e fra u d the U n ite d States in any m anner or fo r any
p u rp o se , an d o n e o r m ore o f such p a rtie s d o any act to effect the o b je c t of the conspiracy, each o f the
p a rtie s to su ch c o n sp irac y shall be fined . . . . ” Act o f M ar. 4, 1909, ch. 321, 35 Stat. 1096.
12 W e h a v e fo u n d no c ase addressing th e validity o f an indictm ent o r c o n viction under sec tio n 371,
w h e re the c h arg e w as conspiracy to c o m m it an o ffen se against the U nited S tates and the u nderlying
o ffe n se that the d e fe n d an ts allegedly c o n sp ire d to c o m m it did not itse lf carry e ith e r crim inal o r civil
p e n a ltie s.
H o w ev e r, ev en if o n e c o u ld not be ch arg ed w ith o r convicted o f conspiring to com m it an offense
a g a in st th e U n ite d S ta te s u n d e r these circ u m stan c e s, it still could be that prosecution w ould b e possible
u n d e r sec tio n 37 1 . S e c tio n 371 also c rim in a liz e s co n sp iracy to d e fra u d the U nited States T h e offense
o f c o n sp ira c y to d e fra u d th e United S ta te s does not seem to depend upon the ex isten ce and c h a ra c te r o f
a se p a ra te s tatu to ry o r o th e r prohibition, as does the o ffen se o f co n sp irin g to co m m it an offense a gainst
th e U n ite d S tates. See, e.g., Haas v. H enkel, 216 U .S. 4 6 2 . 4 79-80 (1910) (“ [A ]ny conspiracy w hich is
c a lc u la te d to o b s tru c t o r im pair [a g o v ern m en tal d e p artm e n t’s] o p e ra tio n s and re p o rts as fair, im p artial
an d re a so n a b ly a cc u ra te w o u ld be to d e fra u d the U n ited States ”); Hammerschmidt v. United States, 265
U .S . 182, 188 (1 9 2 4 ) (to defraud the U n ite d States “ m ean s p rim arily to cheat the G o v ern m en t ou t o f
p ro p e rty o r m oney, but it a lso means to in terfere w ith o r obstruct o n e o f its law ful g overnm ental fu n c ­
tio n s b y d e ce it, c ra ft o r trickery, or at le a st by m eans th a t are d ish o n est") Several cases have sustained
e ith e r in d ic tm e n ts o r co n v ictio n s for c o n sp irac y to d e fra u d the U n ite d States w here there w as n o t any
sp ec ific p ro h ib itio n o f the allegedly frau d u le n t conduct. Haas v. Henkel, 216 U .S. 462 (1910); United
States v. Klein, 2 4 7 F.2d 9 0 8 (2d Cir. 1 957), cert, denied, 355 U.S. 9 2 4 (1958); United States v. A nder­
son, 5 7 9 F.2d 4 5 5 (8th C ir.) (dicta), cert, denied, 439 U .S . 980 (1978).
,J T h a t C o n g re ss e x p lic itly considered and decided ag ain st the application o f sectio n 371 to conduct
p ro s c rib e d u n d e r sec tio n 5 8 5 d istinguishes the circu m stan ces h erein discussed from those und erly in g
th e in d ic tm e n t o f O liv e r N orth and o th e rs in United States v. Poindexter, C rim . N o. 88-0 0 8 0 (D .D .C .). ■
T h a t in d ic tm e n t, w h ile charging a c o n sp irac y to v iolate several c rim in al statutes that them selves c a rry 1
e x p lic it p e n a ltie s, a lso ch arg ed co n sp irac ie s to v io la te th e so-called B oland A m endm ent, as w ell as
m o re g e n e ra l p ro h ib itio n s (e.g., co n sp iracy to d efrau d th e U nited S ta te s “by im p ed in g , im p airin g , d e­
fe a tin g an d o b s tru c tin g th e lawful g o v ern m en tal fu n ctio n s o f the U nited States, including . . c o n g re s­
sio n al co n tro l o f ap p ro p riatio n s and e x e rc ise o f o v e rsig h t"). C o n g re ss did not exp licitly c o n sid e r the
a p p lic a tio n o f 18 U .S .C . § 371 to a lle g e d violations o f the B oland A m endm ent. T here is sim ilarly
n o th in g to in d ic a te th at C ongress in te n d e d to foreclose application o f section 371 to the m ore general
c o n sp ira c y v io la tio n s w ith which the d e fe n d an ts w ere charged.
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582 would not be punishable under 18 U.S.C. § 371.14This is not to say that section 582 may be violated with impunity. The
President has a constitutional duty to “take Care that the Laws be faithfully
executed.” U.S. Const, art. II, § 3. Moreover, it can be anticipated that
Congress will seek to monitor executive branch compliance with the section,
and that an intentional failure to comply may provoke any of a host of
constitutional or political sanctions, if not remedial legislation. The State
Department and other affected executive agencies therefore should, by means
of appropriate directives, urge compliance with the prohibition.
CONCLUSION
We conclude for the reasons set forth above that section 582 prohibits
only an explicit quid pro quo arrangement pursuant to which both the United
States and another government or person that is to receive financial assis­
tance from the United States agree that receipt of the assistance is expressly
conditioned upon the recipient undertaking an action the United States would
be specifically prohibited by United States law from undertaking. Addition­
ally, we conclude that neither violation of section 582 of Public Law No.
101-167, nor conspiracy to violate section 582, is punishable as a criminal
offense.15
J. M ICHAEL LUTTIG
Principal Deputy
Assistant Attorney General
Office o f Legal Counsel
14T h e fact th at sectio n 371 is un av ailab le in this context o f course w ou ld not p re v e n t p ro se cu tio n for
co n d u ct v iolative o f other crim inal statutes.
15T he C rim in al D iv isio n o f the D epartm ent o f Justice co n cu rs in these conclusions.
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