The dangers of imposing U.S. law on others

Brad Cates Former Director of DOJ Asset Fortfeiture Office
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The United States is increasing its efforts to impose its laws on sovereign countries and their citizens. These efforts will prove to be counterproductive and dangerous for both U.S. citizens and businesses.

Every sovereign country, but especially those in the democratic developed world, has a right to devise its own laws. This is the essence of sovereignty. Where international sovereign desires conflict or are silent, international law dictates that the conflict is resolved by convention or treaty, or by a mutual legal assistance treaty (MLAT).

Countries have different customs, beliefs, practices, and legal and legislative process. Actions that are legal, or illegal, in one country, or even one state, are not necessarily viewed the same elsewhere. Citizens of Little Rock may fly to Las Vegas to gamble, something prohibited in their city. Americans have been known to legally take a toke while in Amsterdam.

Would we enforce an Iranian fatwa of death upon an American living in Los Angeles who chose to exercise his right of free speech to make religious comments? Women working at the Exxon offices in Saudi Arabia might well be required to wear burqas, or even be prohibited from working at all. Would we allow all the female employees of Exxon at the corporate offices in Dallas to be fired, if that were a Saudi law? If we claim the right to extend our laws outside our borders, do not other countries have an equal right to extend their laws outside of their borders — and into the United States?

The American legal system is rightly considered among the best in the world. It is honest and transparent. It is not without flaws however. It is expensive and thus inaccessible to most except the poor and rich, it is slow, and it is not especially predictable in its outcome. Certainly, we have no right to force our legal system on others, any more than we as Americans would be inclined to obey dictates of foreign governments if they tried to impose their will on us. We fought a revolution to secure the basic rights of individual freedom and sovereignty. These rights include habeas corpus, warrants, sovereignty, and, fundamentally, a right to be left alone.

The rights to financial privacy are guaranteed in the Swiss constitution. The U.S. Justice Department (DOJ) is seeking to require Swiss banks to violate their constitutional mandate, and, specifically, their own financial privacy laws, as duly passed by one of the most democratic and peaceful governments in the world. Martin Naville, CEO of the Swiss-American Chamber of Commerce, remarked that the Swiss banking system is “the cleanest in the world, with strict laws on money laundering, terrorist finances, corruption, and other illicit activities.” Yet, we seek to impose U.S. law on them, inside their own country.

How would we react if North Korea proposed to require American banks to turn over data on our citizens? What if Mexico demanded that the U.S. government confiscate all guns in America, because some feel that they contribute to violence in Mexico?

Switzerland invests about $200 billion into the U.S. economy each year, and is America’s 15th largest export partner. This trade and investment creates hundreds of thousands of American jobs. As retaliation for the DOJ’s threatened actions, the Swiss banks are threatening to withhold this investment.

For reasons of crime control, terrorism, currency control, and tax policy, the U.S. has chosen a path which significantly infringes on traditional rights of its own citizens. The warrantless searches of financial data and interceptions of private conversations are but two examples. When King George sought to criminally prosecute the businessmen of Boston who were not inclined to yield to the heavy-handed and illegal warrantless searches by Royal officials, John Adams, a legal observer at the trial, remarked “the child independence was born that day.”

Will Rogers remarked upon the irony that America would send ships up the Yangtze River to protect American businessmen and missionaries. Yet, he speculated, we would frown upon the Chinese navy sending gunboats up the Mississippi to protect Chinese laundries in the case of a riot in Memphis.

In a diverse world, one size does not fit all. America can assure more respect for its laws if it respects the rights of others to pursue different paths for their own legal and financial systems.

Mr. Brad Cates is an attorney in private practice who specializes in money laundering compliance. He was formerly head of the U.S. Justice Department Asset Forfeitures Office and a federal prosecutor.