The USA PATRIOT Act: new adventures in American extraterritoriality

Abstract

Gives the background to the Act, whose Title III was meant in part to deal with financial secrecy jurisdictions. Reviews the antagonism of American courts towards financial secrecy when it interferes with domestic disclosure of documents, mentioning the Aerospatiale, Westinghouse and other legal cases. Discusses the extraterritorial provisions of the PATRIOT Act: indirect regulation through domestic institutions, and direct regulation of foreign financial institutions through the extension of American money laundering regulations. Points out that the first major application of the Act was in fact against tax evasion rather than terrorist finance, and concerned VISA International; the Attorney General’s intention was to use VISA credit cards to identify American tax evaders who have stashed money in financial secrecy jurisdictions, and this may sever the links between these jurisdictions and the US banking and financial system. Sets the Act in the context of previous American attempts to legislate outside US jurisdiction, such as the Helms‐Burton Act. Concludes that the new legislation may ultimately hurt long term American interests, both business and diplomatic, all for the sake of impeding tax evasion.

Citation

Preston, E. (2002), "The USA PATRIOT Act: new adventures in American extraterritoriality", Journal of Financial Crime, Vol. 10 No. 2, pp. 104-116. https://doi.org/10.1108/13590790310808664