The embassy informed me that "we were lucky" we weren't picked up before and that part of the problem was the fact that this change in the law - which came into effect last October - gets very little publicity.
Uh, no. The requirement for a valid US passport under these circumstances was signed into law October 25,
1994. October, sure. But
last October? No. (Of course, I could be missing something here, but I don't think so...)
For those with an interest, the legislation I'm looking at is PL 103-416, codified as 8 USC 1185(b). Prior to the 1994 change, the law said, "...it shall be unlawful for any citizen of the United States to depart from or enter, or attempt to depart from or enter, the United States unless he bears a valid passport." The 1994 change inserted the words "United States" after "valid."
Not defending the rules... just trying to be accurate.
Dave