Cite as: 531 U. S. 12 (2000)
Syllabus
(a) Section 1341 is largely limited to the protection of money and property. McNally v. United States, 483 U. S. 350, 360; Carpenter v. United States, 484 U. S. 19, 25. The only nonproperty right protected by § 1341 is "the intangible right of honest services," § 1346, a right not implicated by this case. Pp. 18-20.
(b) Section 1341 does not reach fraud in obtaining a state or municipal license of the kind here involved, for such a license is not "property" in the government regulator's hands. Whatever interests Louisiana might be said to have in its video poker licenses, the statute itself shows that the State's core concern is regulatory: It licenses, subject to certain conditions, engagement in pursuits that private actors may not undertake without official authorization. The Government offers two reasons why the State also has a property interest in its video poker licenses. The Court rejects both because they stray from traditional concepts of property. First, the Government stresses that the State receives a substantial sum of money in exchange for each license and continues to receive payments from the licensee as long as the license remains in effect. However, Louisiana receives the lion's share of its expected revenue not while the licenses remain in its own hands, but only after they have been issued to licensees. Licenses pre-issuance merely entitle the State to collect a processing fee from applicants. Were such an entitlement sufficient to establish a state property right, then States would have property rights in drivers' licenses, medical licenses, and other licenses requiring an upfront fee—licenses that the Government concedes are purely regulatory. Tellingly, the Government does not allege that Cleveland defrauded Louisiana of any money to which it was entitled by law. If Cleveland defrauded the State of "property," the nature of that property cannot be economic. The Government's second assertion—that the State has significant control over the issuance, renewal, suspension, and revocation of licenses—is also unavailing. Far from composing an interest that "has long been recognized as property," Carpenter, 484 U. S., at 26, these intangible rights of allocation, exclusion, and control amount to no more and no less than paradigmatic exercises of the State's traditional police powers. Pp. 20-23.
(c) Comparison of the State's interest in video poker licenses to a patent holder's interest in an unlicensed patent does not aid the Government. Although both involve the right to exclude others, Louisiana does not conduct gaming operations itself and does not hold video poker licenses to reserve that prerogative. And while a patent holder may sell her patent, the State may not sell its licensing authority. Comparison of the State's licensing power to a franchisor's right to select its franchisees fares no better. While the latter right typically derives from a franchisor's ownership of some product that it may trade or sell
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