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A Good Carrot? U.S. Travel Restrictions in Cartel Enforcement

J. Mark Gidley, Patrick Eyers, Oct 14, 2011

Based on an obscure memorandum, foreign executives accused of price-fixing in the United States face a Hobson's Choice: plead guilty and serve time in a U.S. prison, or refuse to plead guilty and incur criminal jeopardy, plus restricted travel to the United States. For executives in the early or middle stages of successful careers in which regular business travel to the United States is essential, the prospect of serving a reduced sentence in a low-security U.S. prison might appear initially as a better option than refusing to plead and risking conviction and a career-ruining ban on travel to the United States.

The Antitrust Division of the U.S. Department of Justice ("DOJ"), recognizing the substantial leverage it possesses as gatekeeper to the world's largest economy, has seized upon this dynamic in negotiating an ever-increasing number of guilty pleas from foreign executives in antitrust investigations. Scott Hammond, Deputy Assistant Attorney General for criminal enforcement at DOJ, recently characterized DOJ's immigration leverage as "a good carrot."

Disturbingly, the immigration consequences which DOJ brings to bear on plea negotiations in antitrust cases derive from an obscure (and questionable) 1996 Memorandum of Understanding ("MoU") between two U.S. government departments: the Antitrust Division and the Immigration and Naturalization Service ("INS"). Today, the INS is now the Immigration and Customs Enforcement Division of the Department of Justice ("ICE"). The 1996 MoU states that the INS "considers" criminal antitrust offenses to be "crimes involving moral turpitude," thereby rendering convicted price-fixing offenders inadmissible into the United States for a 15-year period under 18 U.S.C. §1182. The untested memorandum of the U.S. government notwithstanding, no court in the United States has ever held an antitrust offense to be a crime of moral turpitude.

That antiquated expression, crime involving moral turpitude ("CIMT"), is typically reserved for "inherently base, vile or depraved" crimes, such as bank robbery and attempted murder.  As such, there appears to be no legal basis whatsoever to ban antitrust offenders from the United States for such lengthy periods, or to threaten them with such in the course of plea negotiations under the CIMT rubric. Until the legality of characterizing antitrust offenses as CIMTs is challenged, however, DOJ is likely to continue to convince foreign executives to submit to U.S. prisons regardless of the strength of the government's case against them.

 

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