A Collaboration with the University of Pittsburgh

Court upholds presidential regulation of foreign financial transactions involving US

[JURIST] The US Second Circuit Court of Appeals [official website] Thursday upheld [opinion text, PDF] the constitutional authority of the US president to regulate financial transactions with foreign countries involving the United States. The court
rejected a claim by a Jordanian man, Osameh Al Wahaidy [profile], that former President George H.W. Bush [official profile] improperly invoked the International Emergency Economic Powers Act [PDF] to enforce a series of executive orders after Iraq invaded Kuwait in 1990. The orders made it illegal for a US person to transfer funds [JURIST report] to anyone in Iraq. Wahaidy argued that the power to create new criminal offenses belongs to Congress alone. In 2003, Wahaidy pleaded guilty to willfully trying to violate and evade executive orders by sending $100,000 to Iraq [US DOJ press release] in October and November 1999 and in February 2000. He did, however, reserve the right to challenge the statute's constitutionality. Wahaidy claimed he was donating the money to a Syracuse-based charity called Help the Needy, but officials believed the money was being used to support terrorism; the founder of the organization was later sentenced to 22 years [JURIST report] in prison for funneling donations to Iraq.

In Thursday's decision, the court wrote, quoting a 2003 Second Circuit ruling:

The Constitution vests in Congress the legislative power to define criminal conduct; but "our jurisprudence" has reached "a practical understanding that...Congress simply cannot do its job absent an ability to delegate power under broad general directives." Delegations of congressional authority are upheld "so long as Congress 'shall lay down by legislative act an intelligible principle to which the person or body authorized to [exercise the delegated authority] is directed to conform.'"
The court also cited the 1936 US Supreme Court ruling in US v. Curtiss-Wright Export Corp. [opinion text] in which the high court upheld the president's authority to declare illegal the sale of arms to certain countries, thereby defining a criminal offense. AP has more.

About Paper Chase

Paper Chase is JURIST's real-time legal news service, powered by a team of 30 law student reporters and editors led by law professor Bernard Hibbitts at the University of Pittsburgh School of Law. As an educational service, Paper Chase is dedicated to presenting important legal news and materials rapidly, objectively and intelligibly in an accessible format.

© Copyright JURIST Legal News and Research Services, Inc., 2013.