U.S. v. Ibarra-Alcarez

Decision Date03 September 1987
Docket NumberNos. 86-3124,86-3125,IBARRA-ALCAREZ and J,s. 86-3124
Citation830 F.2d 968
PartiesUNITED STATES of America, Plaintiff-Appellee, v. Noelose Adeodato Ibarra-Alcarez, Defendants-Appellants.
CourtU.S. Court of Appeals — Ninth Circuit

Patricia Olson and William Redkey, Seattle, Wash., for plaintiff-appellee.

Alan Zarky and Richard Hansen, Seattle, Wash., for defendants-appellants.

Appeal from the United States District Court for the Western District of Washington.

Before FARRIS, ALARCON and WIGGINS, Circuit Judges.

ALARCON, Circuit Judge:

Defendants-Appellants Jose Adeodato Ibarra-Alcarez (hereinafter Jose Ibarra) and Noel Ibarra-Alcarez (hereinafter Noel Ibarra) appeal from the judgment of conviction for conspiracy, in violation of 18 U.S.C. Sec. 2 (1982), and for transporting United States currency in excess of $10,000 from the United States into Canada without filing a report in violation of 31 U.S.C. Secs. 5316(a) (1982 & Supp. III 1985) and 5322(a) (Supp. III 1985). They seek reversal on two grounds.

One. Failure to file a report of the transportation of United States currency is not a crime because the Secretary of the Treasury did not publish regulations specifying the information to be reported or the form which must be used.

Two. The trial court erred on refusing to instruct the jury on good faith reliance on the advice of counsel and ignorance of the law.

The primary question we must decide is whether the Secretary of the Treasury must publish, as a regulation, the form used for reporting the transportation of United States currency in excess of $10,000 (hereinafter Form 4790) before failure to file such a report can be punished as a criminal violation under 31 U.S.C. Sec. 5316(a). We affirm the judgment. Form 4790 does not impose a duty not already contained in published regulations and the jury was properly instructed.


Jose Ibarra and Noel Ibarra are brothers who live in Tucson, Arizona. Their father, Adeodato Ibarra, was in the money exchange business in Nogales, Arizona, at the border between the United States and Mexico. Jose Ibarra has a construction firm in Mexico. Noel Ibarra did odd jobs for his brother. On November 22, 1985, Noel Ibarra left Tucson in a Chevrolet Blazer Jeep. The vehicle contained $2.1 million hidden in an ice chest and a tire. He arrived at Blaine, Washington at 3:00 a.m. on November 25, 1985. Later that morning, Noel Ibarra met his brother, Jose Ibarra, at a restaurant in Blaine. A tire containing $800,000 was placed in the trunk of a car rented by Jose Ibarra in Vancouver, British Columbia. The car had British Columbia license plates. The brothers then attempted to enter Surrey, British Columbia at the Pacific Highway crossing. They were stopped by Canadian customs officers. Jose Ibarra was asked by a primary inspection officer if he had anything in the vehicle besides personal clothing. Jose Ibarra responded: "Nothing, nothing at all." The primary inspection officer opened the trunk of the automobile. Inside he discovered two spare tires. The brothers were referred to a secondary customs inspector for further search of the vehicle. The secondary inspector noticed that one of the tires in the trunk had a slash in the sidewall. The tire was cut open. Four paper bags containing United States currency were found in the tire.

The Canadian customs inspectors notified a United States customs officer that United States currency had been transported into Canada by the Ibarra brothers. The money was sealed in a box and returned to Jose Ibarra. The Ibarra brothers were permitted to confer with counsel by the Canadian officials. Jose and Noel Ibarra were informed that they would not be allowed to remain in Canada. They were ordered to return to the United States immediately. Jose Ibarra was instructed by a Canadian customs inspector to disclose the money when he returned to the United States.

Upon their reentry into the United States, the Ibarra brothers were detained and questioned. They were followed into the United States by their lawyers. Jose Ibarra was asked if he had anything to declare. He replied that he had $900,000 in United States currency and wanted to fill out the form. The occupants of the automobile were told to park their car and go inside the building for further inspection. Jose Ibarra filled out a copy of Form 4790 on which he stated he had more than $10,000 to declare. In the presence of his attorney, Jose Ibarra showed the box containing the currency to the United States customs inspectors. After he was arrested, Jose Ibarra requested permission to fill out a copy of Form 4790 to report taking more than $10,000 in United States currency into Canada earlier that day. His request was denied. He was told that it should have been filled out prior to his departure from the United States.

A. Sufficiency of the Reporting Regulations

The Ibarra brothers argue that their conviction for failing to report the transportation of United States currency from the United States in excess of $10,000 must be reversed because the Secretary of the Treasury did not publish the reporting requirements set forth in Form 4790 in the Federal Register. They contend that Form 4790 contains a legislative rule which supplies the sole basis for a prosecution under 31 U.S.C. Sec. 5316.

The interpretation of the requirements of a statute is a question of law we review de novo. United States v. Doubleday, 804 F.2d 1091, 1093 (9th Cir.1986) (per curiam), cert. denied, --- U.S. ----, 107 S.Ct. 1628, 95 L.Ed.2d 201 (1987). The Ibarra brothers were charged with violating 31 U.S.C. Sec. 5316. Section 5316(a) provides in pertinent part as follows:

[A] person ... shall file a report under subsection (b) of this section when the person ... knowingly--[p] (1) transports ... monetary instruments of more than $10,000 at one time--[p] (A) from a place in the United States to or through a place outside the United States....

Section 5316(b) provides that "[a] report under this section shall be filed at the time and place the Secretary of the Treasury prescribes." (Emphasis added). The statute does not set forth the time or place that the report must be filed. Congress delegated this duty to the Secretary. The statute itself does not proscribe conduct. Section 5316(b) enables the Secretary to promulgate regulations setting forth the time and place that a person must report the transportation, to or from the United States, of United States currency in excess of $10,000. No punishment can be imposed for such transportation in the absence of a properly promulgated regulation. In California Bankers Ass'n v. Shultz, 416 U.S. 21, 94 S.Ct. 1494, 39 L.Ed.2d 812 (1974), the Supreme Court held that

[t]he Act's civil and criminal penalties attach only upon violation of regulations promulgated by the Secretary; if the Secretary were to do nothing, the Act itself would impose no penalties on anyone.

Id., at 26, 94 S.Ct. at 1500.

Thus, our responsibility is to review the regulations promulgated by the Secretary of the Treasury to determine if they set forth the time and place that the report required by section 5316(a) must be filed.

The Secretary of the Treasury has promulgated two regulations pursuant to the direction of Congress in section 5316(a) and (b). These regulations provide as follows:

Each person who physically transports, mails, or ships, or causes to be physically transported, mailed, or shipped, or attempts to physically transport, mail or ship, or attempts to cause to be physically transported, mailed or shipped, currency or other monetary instruments in an aggregate amount exceeding $10,000 on any one occasion from the United States to any place outside the United States, or into the United States from any place outside the United States, shall make a report thereof. A person is deemed to have caused such transportation, mailing or shipping when he aids, abets, counsels, commands, procures, or requests it be done by a financial institution or any other person.

31 C.F.R. Sec. 103.23(a) (1986) (emphasis added).

Reports required to be filed by Sec. 103.23(a) shall be filed at the time of entry into the United States or at the time of departure, mailing or shipping from the United States, unless otherwise directed or permitted by the Commissioner of Customs. They shall be filed with the Customs officer in charge at any Customs port of entry or departure, or as otherwise permitted or directed by the Commissioner of Customs. If the currency or other monetary instruments with respect to which a report is required do not accompany a person entering or departing from the United States, such reports may be filed by mail on or before the date of entry, departure, mailing or shipping, with the Commissioner of Customs, Attention: Currency Transportation Reports, Washington, D.C. 20226. They shall be on forms to be prescribed by the Secretary and all information called for in such forms shall be furnished.

31 C.F.R. Sec. 103.26(b) (1986) (emphasis added).

In 31 C.F.R. Sec. 103.23(a), the Secretary of the Treasury has set forth the duty imposed pursuant to the express provisions of section 5316(a) that every person who transports more than $10,000 in currency in or out of the United States must file a report. Persons directed to file the report required by section 5316(a) and 31 C.F.R. Sec. 103.23(a) are clearly informed by 31 C.F.R. Sec. 103.26(b) that they must do so at the time of entry or departure with the customs officer at any port of entry and departure. These regulations provide the notice and the specification of the time and the place of reporting of the transportation of currency required by Congress in section 5316(b). Accordingly, the penalties set forth in 31 U.S.C. Sec. 5322(a) are applicable to any person who knowingly violates the reporting requirement of section 5316(a).

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