390 U.S. 39, 88 S. Ct. 697, 19 L. Ed. 2d 889 (1968)
Petitioner Marchetti was convicted in the United States District Court for the District of Connecticut under two indictments which charged violations of the federal wagering tax statutes.1 The first indictment averred that petitioner and others conspired to evade payment of the annual occupational tax imposed by 26 U.S.C. § 4411.2 The second indictment included two counts: the first alleged a willful failure to pay the occupational tax, and the second a willful failure to register, as required by 26 U.S.C. § 4412, before engaging in the business of accepting wagers.3
After verdict, petitioner unsuccessfully sought to arrest judgment, in part on the basis that the statutory obligations to register and to pay the occupational tax violated his Fifth Amendment privilege against self-incrimination.4 The Court of Appeals for the Second Circuit affirmed, 352 F. 2d 848, on the authority of United States v. Kahriger, 345 U. S. 22, and Lewis v. United States, 348 U. S. 419.5
The Supreme Court granted certiorari to re-examine the constitutionality under the Fifth Amendment of the pertinent provisions of the wagering tax statutes, and more particularly to consider whether Kahriger and Lewis still have vitality.6 Marchetti's wagering activities occurred in Connecticut, which punishes any person who owns, possesses, keeps, manages, maintains or occupies premises employed for purposes of wagering or pool selling under Conn. Gen. Stat. Rev. § 53-295, and imposes additional criminal penalties for possession of premises where policy playing or lotteries occur and for conspiracy to organize or conduct unlawful wagering activities.7
The federal wagering tax system requires those liable for the occupational tax to register each year with the director of their local internal revenue district by submitting Internal Revenue Service Form 11-C, which must provide residence and business addresses, indicate whether they are engaged in accepting wagers, and list the names and addresses of agents and employees.8 Registrants must post revenue stamps conspicuously in their principal places of business or keep them on their persons, preserve daily records of gross wagers, and permit inspection of their books, while each principal internal revenue office maintains for public inspection a listing of all who have paid the occupational tax and provides certified copies to state or local prosecuting officers upon request.9
Whether the registration and occupational tax requirements of the federal wagering tax statutes may be employed to punish criminally those who assert the Fifth Amendment privilege against self-incrimination?10
The privilege against self-incrimination guaranteed by the Fifth Amendment may be asserted as a defense to criminal prosecutions for failure to comply with statutory requirements that create real and appreciable hazards of self-incrimination, and such requirements may not be enforced through criminal punishment against those who properly invoke the privilege.11
Yes. The obligations to register and pay the occupational tax, as applied to Marchetti, made information about his wagering activities available to prosecuting authorities through public listings maintained by internal revenue offices and the requirement to post revenue stamps conspicuously.12 These requirements created substantial hazards of self-incrimination in light of Connecticut's broad criminal prohibitions on wagering under Conn. Gen. Stat. Rev. § 53-295 and related statutes.13
The hazards were real and appreciable. Wagering is an area permeated with criminal statutes throughout the United States. Those engaged in wagering are a group inherently suspect of criminal activities. Every aspect of Marchetti's activities subjected him to possible state or federal prosecution.14
The registration and occupational tax requirements of the federal wagering tax statutes may not be employed to punish criminally those who assert the Fifth Amendment privilege against self-incrimination.15
Whether United States v. Kahriger and Lewis v. United States retain vitality?16
Precedents holding that the privilege against self-incrimination is unavailable because wagering tax requirements are prospective or because there is no constitutional right to gamble are no longer persuasive when the requirements create substantial hazards of incrimination as to past, present, and future acts.17
No. Kahriger and Lewis are overruled. The registration and occupational tax requirements under 26 U.S.C. §§ 4411 and 4412 created real hazards of incrimination as to past or present acts for Marchetti.18 They increased the likelihood that gambling offenses would be discovered. They compelled injurious disclosures that could provide evidence admissible in prosecution.19
The reasoning in those cases that the privilege is inapplicable to prospective acts is deficient. The central standard is whether the claimant faces substantial and real hazards of incrimination.20 This is not a rigid chronological distinction. The facts show that prospective registrants can reasonably expect registration to enhance the likelihood of prosecution for future acts.21
United States v. Kahriger and Lewis v. United States do not retain vitality.22
Whether the required records doctrine from Shapiro v. United States precludes assertion of the Fifth Amendment privilege with respect to the wagering tax registration and tax payment obligations?23
The required records doctrine applies only when the government compels records of the same kind customarily kept, bearing public aspects, in an essentially non-criminal and regulatory area of inquiry; none of these elements are present when the requirements target a selective group inherently suspect of criminal activities.24
No. The required records doctrine from Shapiro v. United States does not preclude assertion of the privilege. Marchetti was not obliged by the wagering tax provisions to keep and preserve records of the same kind as he has customarily kept.25 He was required simply to provide information on Form 11-C unrelated to any records he may have maintained. Whatever public aspects existed in Shapiro are absent here.26
The government's demand for information known to a private individual does not render it public. The requirements are directed to a selective group inherently suspect of criminal activities rather than an essentially non-criminal regulatory area.27
The required records doctrine from Shapiro v. United States does not preclude assertion of the Fifth Amendment privilege with respect to the wagering tax registration and tax payment obligations.28
Whether use restrictions on information obtained from compliance with the wagering tax statutes should be imposed to permit continued enforcement of those statutes?29
Use restrictions on information obtained from compliance with statutory requirements may not be imposed by the Court when the terms of the statute make plain that Congress intended the information to be provided to prosecuting authorities.30 The Constitution entrusts to Congress the task of striking an appropriate balance among competing values.31
No. Use restrictions should not be imposed. The terms of the wagering tax system, particularly 26 U.S.C. § 6107, make quite plain that Congress intended information obtained as a consequence of registration and payment of the occupational tax to be provided to interested prosecuting authorities.32 This has been the consistent practice of the Revenue Service. The imposition of such restrictions would directly preclude effectuation of a significant element of Congress's purposes.33
It would also hamper enforcement of state prohibitions against gambling.34
Use restrictions on information obtained from compliance with the wagering tax statutes should not be imposed to permit continued enforcement of those statutes.35