In April, the US Sentencing Commission delivered to Congress its annual proposed amendments to the Federal Sentencing Guidelines. Although the Guidelines have been considered advisory only since the US Supreme Court’s 2005 decision in US v. Booker, federal judges still use them to calculate a defendant’s sentence, and they remain an important tool used by defense counsel to assess the level of risk and exposure for criminal defendants in federal court.
Two of the proposed amendments are particularly significant for federal white-collar criminal defendants: those relating to the calculation of loss in white-collar financial crimes, and the proposed amendments for the use of acquitted conduct in sentencing.
Here, federal criminal defense attorney Hope Lefeber provides an analysis of the proposed amendments to the US Federal Sentencing Guidelines and their potential impact on federal white-collar criminal defendants.
On April 30, 2024, the US Sentencing Commission delivered to Congress its proposed annual amendments to the US Federal Sentencing Guidelines. The Guidelines are used to calculate recommended sentencing ranges for people convicted of federal crimes and take into account factors such as the defendant’s conduct, the circumstances of their offense, their personal history, and the need to make victims whole.
Every year, the Sentencing Commission submits proposed amendments to the Guidelines to Congress, which has 180 days to vote to alter or reject them. Absent any changes or objections, the proposed amendments take effect on November 1. Rejection of the proposed amendments is unlikely, as Congress has only rejected two proposed amendments since the Federal Sentencing Guidelines were enacted in 1987.
The Guidelines provide a framework for sentencing defendants accused of financial crimes that involve economic losses. The Commentary to §2B1.1, which addresses “Larceny, Embezzlement, and Other Forms of Theft,” defines “loss” as the greater of the intended loss or actual loss.
In 2022, the Third Circuit Court of Appeals decided USA v. Banks, ruling that courts should use actual loss, and not intended loss, when sentencing defendants for economic crimes.
In response to Banks, the proposed 2024 amendment moves the listed methods for calculating from the “Commentary,” which represents the Sentencing Commission’s interpretation of the Guideline, to the body of the guideline, itself, under “Notes,” thereby eradicating the benefit of the Banks decision.
If enacted, the proposed amendment would result in harsher penalties for white-collar defendants, especially in cases that caused little to no actual financial harm. For example, bank fraud cases often have an intended loss that far exceeds the actual loss suffered by the bank. In those cases, a criminal defendant would face a much harsher sentence under an intended loss standard. Similarly, in wire fraud cases, where a defendant may have made misrepresentations, but the victim suffered no actual loss, the application of intended loss may have extremely negative consequences.
In 1997, the US Supreme Court decided US v. Watts, ruling that courts could sentence a defendant based on prior conduct they had been acquitted of if the court found, by a preponderance of the evidence, that the acquitted conduct was “relevant.”
“Acquitted conduct” refers to actions for which a defendant was indicted but ultimately found Not Guilty, and conduct an appellate court determined to be insufficient to constitute an offense. Acquitted conduct is not currently addressed in the Guidelines, other than in a parenthetical summary citation to Watts, which permitted a sentencing court to consider acquitted conduct.
Under the Commission’s proposed amendment to §1B1.3 and the Commentary to §6A1.3, “acquitted conduct” would be omitted from the scope of relevant conduct that can be considered in sentencing. Enshrining this fact in the Guidelines will help protect the credibility of the criminal justice system and make clear that consideration of acquitted conduct has no place in federal sentencing.
Applying the Federal Sentencing Guidelines to a criminal case is a complex and nuanced undertaking. A seemingly trivial detail can have a significant impact when evaluating risk and calculating a defendant’s potential sentence.
If you were charged with a federal crime or are under investigation, you need a lawyer who has experience defending people in federal court and who has a comprehensive understanding of federal sentencing laws. Hope Lefeber has dedicated her career to defending people accused of crimes in federal court and uses her insight into federal criminal law and the Federal Sentencing Guidelines to achieve superior results for her clients.
To learn more about Ms. Lefeber and how she can help, contact The Law Offices of Hope Lefeber today to schedule a confidential consultation to discuss your situation.
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