Marchetti v. United States
390 U.S. 39 (1968)
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Rule of Law:
A proper assertion of the Fifth Amendment privilege against self-incrimination provides a complete defense to a criminal prosecution for failure to comply with federal wagering tax statutes, as the statutes' requirements to register and pay an occupational tax create real and appreciable hazards of incrimination.
Facts:
- Petitioner Marchetti was engaged in the business of accepting wagers in Connecticut.
- Federal law required individuals in the wagering business to pay an annual occupational tax and to register with the Internal Revenue Service (IRS).
- The registration form required disclosure of the registrant's name, address, and confirmation that they were in the wagering business.
- Wagering and associated activities were widely prohibited by state law in Connecticut and almost every other state, as well as by various federal statutes.
- Federal law required the IRS to make lists of those who paid the occupational tax available for public inspection and to provide certified copies to any state or local prosecuting officer upon request.
- The IRS was in 'full cooperation' with the Attorney General's efforts to suppress organized gambling, making information from the wagering tax forms available to law enforcement agencies.
- Marchetti did not register with the IRS or pay the occupational tax as required by the federal statutes.
- Compliance with the federal wagering tax statutes would have provided authorities with a significant 'link in a chain' of evidence to prosecute Marchetti for illegal gambling.
Procedural Posture:
- Petitioner Marchetti was convicted in the U.S. District Court for the District of Connecticut on two indictments for violating federal wagering tax statutes.
- Following the verdict, Marchetti moved to arrest the judgment, arguing that the statutes violated his Fifth Amendment privilege against self-incrimination; the district court denied the motion.
- Marchetti appealed his conviction to the U.S. Court of Appeals for the Second Circuit.
- The Court of Appeals affirmed the conviction, relying on the precedent set by United States v. Kahriger and Lewis v. United States.
- The U.S. Supreme Court granted certiorari to re-examine the constitutionality of the wagering tax statutes under the Fifth Amendment.
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Issue:
Do the federal wagering tax statutes, which require registration and payment of an occupational tax by persons engaged in the business of accepting wagers, violate the Fifth Amendment privilege against self-incrimination when compliance would provide incriminating information to prosecuting authorities?
Opinions:
Majority - Mr. Justice Harlan
Yes. The federal wagering tax statutes violate the Fifth Amendment privilege against self-incrimination because they compel disclosures that an individual may reasonably expect to be used in a criminal prosecution. The Court overruled its prior decisions in United States v. Kahriger and Lewis v. United States, finding their reasoning no longer persuasive. The privilege is not waived by choosing to engage in an illegal activity, nor is it limited to past acts; declaring a present intent to gamble creates immediate hazards of prosecution for conspiracy. The Court reasoned that the wagering statutes were directed at a 'selective group inherently suspect of criminal activities' in an area 'permeated with criminal statutes.' Compliance created 'real and appreciable' hazards of incrimination, not merely 'imaginary and unsubstantial' ones. The 'required records' doctrine from Shapiro v. United States is inapplicable because the requirements did not involve customary business records, the information lacked a 'public aspect,' and the statutory scheme was not in an 'essentially non-criminal and regulatory area.' Finally, the Court declined to impose judicial use-restrictions on the information, stating that it is Congress's role, not the Court's, to balance the competing interests of revenue collection and law enforcement.
Analysis:
This decision significantly strengthened the Fifth Amendment privilege by holding that it protects individuals from being compelled to choose between incriminating themselves under one statutory scheme or facing criminal prosecution for failing to comply with it. By overruling Kahriger and Lewis, the Court shifted from a formalistic view of waiver to a realistic assessment of the 'real and appreciable' risks of incrimination faced by individuals targeted by such laws. The ruling forces Congress to design regulatory and taxing schemes in criminally-permeated areas more carefully, often requiring grants of immunity if it wishes to compel information. This case stands for the principle that the government cannot use its taxing power as an instrument to coerce self-incrimination from a select group suspected of criminal activity.
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