International bad guys and their flunkies beware: there’s a brand new sheriff looking to stop your nefarious deeds. That’s right, President Trump has determined that “serious human rights abuse and corruption around the world constitute an unusual and extraordinary threat to the national security, foreign policy, and economy of the United States, and I hereby declare a national emergency to deal with that threat.” Now there’s an admirable goal, I’m sure, though quite vague in its generality. The text of Executive Order 13818 similarly leaves many open questions.
Extensive Range of Parties Who May Be Sanctioned
The EO authorizes the Treasury Department to identify “any foreign person” who is “responsible for or complicit in, or . . . directly or indirectly engaged in, serious human rights abuse” or a current or former government official, or a person acting for or on behalf of such an official, who is responsible for or complicit in, or has directly or indirectly engaged in: corruption.” That term includes “the misappropriation of state assets, the expropriation of private assets for personal gain, corruption related to government contracts or the extraction of natural resources, or bribery” It also covers transferring the proceeds of these acts.
In addition to the crooks themselves, leaders and officials of “an entity, including a government entity,” that engaged in such misbehavior are covered. The term “entity” thus appears to encompass non-government actors as well, along with those running them even if they were not themselves involved in the prohibited behavior.
But wait, there’s more. “Any person” who has assisted or supported these activities may also be sanctioned, along with “any entity . . . whose members have engaged in” them. Entities “owned or controlled” by a sanctioned party are fair game as well. The EO also includes the usual prohibitions on evasions, attempts to evade and conspiracies to violate the EO’s terms.
Due Process? What’s That?
This is a remarkable document. Taken at face value, it permits a United States government administrative agency to define, investigate and punish alleged misdeeds by foreign government agencies, officials and private persons, along with “United States persons” who supposedly have assisted them. The violations identified (“corruption”, “human rights abuse”) are vague and ill-defined at best, and there is no guidance on what, if any legal authority will be used to determine when they have occurred. Only one of the statutes which EO 13818 is based addresses this point, and with barely more detail than the EO itself.
Some indication of the types of persons and activities we can expect to be sanctions may be inferred from the baker’s dozen individuals listed in the EO. They include past and current government officials and private citizens, and their alleged abuses strike me as having varying degrees of seriousness. What is more interesting is that most of the allegations are just that; with one exception, none of the named parties is claimed to have had criminal or civil resolution of the claims made against them.
The non-existent standard of proof is problematic not only for foreign rogues. The “any entity” references can encompass United States persons who have done business with sanctioned foreign parties, meaning that they can have their assets frozen by Treasury based on mere association with persons who may not even have been charged anywhere with illegal behavior.
Treasury may be on surer ground if it proceeds against foreign or domestic entities that have violated the Foreign Corrupt Practices Act, such as Mr. Angel Rondon Rijo, one of the persons named in the Executive Order. At least, in those cases, there will have been a resolution of actual charges based on an actual statute with actual standards for determining whether a violation has occurred.
If this sounds cynical, well, I guess it is. Despite its highfalutin language, EO 13818 seems designed to permit Treasury to sanction persons and governments in disfavor with the United States government. Time will tell how extensively, and impartially, it is applied.