A federal jury in Brooklyn, New York, this week acquitted Jean Boustani, a Lebanese boat salesman, of all fraud and money-laundering charges. For Boustani, the jurors’ verdict meant personal vindication. For the US government, the outcome was an unexpected blow to its efforts to make America the world’s policeman.

Last winter, the prosecution vowed to prove that Boustani, 41, was the linchpin of a grand conspiracy, “an immense fraud and bribery scheme that took advantage of the US financial system.” But after a six-week trial, all that was left of that narrative was an old-fashioned commercial kickback scheme that involved a pair of European banks.

The US government tried to demonstrate that Boustani was part of a massive fraud disguised as a US$2 billion package of loans that paid for ships and systems sold to the government of Mozambique. The conspirators purportedly lined “their own pockets with hundreds of millions of dollars.” As for Boustani, he was the supposed “mastermind.” The jurors disagreed.

Boustani had never even set foot in the US until he was forcibly detoured to New York’s John F Kennedy International Airport last January. His relationship to the debt securities at the heart of the government’s case was attenuated.

Three former Credit Suisse bankers pleaded guilty to a single conspiracy charge. Their illegal activities occurred in Europe, Africa and the Middle East, not the US.

Credit Suisse and VTB Bank made the loans, not Boustani’s employer, Privinvest, a Middle East–based shipbuilder. Prosecutors had alleged that the purchase agreements were “shams.” But testimonial and physical evidence demonstrated that the ships and systems were delivered as promised.

Prosecutors also tried to assert that the debts were “hidden.” But the evidence showed that multiple Mozambican officials were aware of the projects. An official of the International Monetary Fund also acknowledged one of the loans.

Further, Mozambican officials knew for years that they needed the fishing fleet and coastal security system. Somali pirates cost East Africa more than $24 billion between 2010 and 2017. The Horn of Africa remains a pirate hot spot. Meanwhile, Africa’s fishermen are being overwhelmed by sophisticated fleets from China, Russia and Europe, at a time when global economic growth is projected to decline.

On the other hand, the US government’s appraisers didn’t understand what had been delivered. One of them couldn’t even recognize a photo of a ship his team had supposedly appraised. Against this backdrop, the jury rejected the prosecution’s contention that the Mozambican companies had been defrauded into paying an inflated price for unneeded wares.

As expected, the US government offered no comment in the aftermath of the verdict, and jury acquittals in criminal cases are not subject to appeal. But one implication is obvious. From now on, US prosecutors will have to think twice before proceeding with overseas securities cases, particularly when American investors are not part of the primary market.

Under the US Foreign Corrupt Practices Act (FCPA), foreigners acting abroad may only be prosecuted under a limited set of circumstances. Practically speaking, that would appear to be the desirable rule in securities cases too.

For the US government, all this comes as a surprise. Last month, a federal jury sitting in Connecticut convicted Lawrence Hoskins, a former senior executive with Alstom SA, a French power and transportation company, on FCPA charges. It found that he was acting as an agent of an Alstom US subsidiary. By contrast, Boustani’s ties were exclusively foreign.

As the US Supreme Court has long held: “In general, United States law governs domestically but does not rule the world.” Boustani’s acquittal is a tart reminder that prosecutors would be well served to remember that legal axiom.