Friday, April 24, 2015

Attorneys for another convicted CIA leaker urges judges to follow Petraeus sentencing lead

This notable new Washington Post article, headlined "Attorneys ask judge to consider Petraeus in sentencing ex-CIA officer Sterling," the seemingly lenient treatment given yesterday to former CIA director David Petraeus for leaking information to his journalist/mistress (basics here) is already having an echo effect in other federal criminal cases.  Here are the interesting details:

Defense attorneys for the former CIA officer convicted of giving classified information to a New York Times reporter urged a federal judge on Friday to sentence their client in line with the terms faced by other so-called leakers — noting that not 24 hours ago, a retired general and ex-CIA director was given mere probation in a similar case.

Defense attorneys for Jeffrey Sterling did not endorse a specific penalty, but they urged U.S. District Judge Leonie M. Brinkema to consider the impact of the case and be fair. The defense attorneys argued that in three other recent leak cases, those convicted received — at the most — 30 months in prison. On Thursday retired general and former CIA chief David Petraeus was sentenced to two years of probation and a $100,000 fine. “In meting out justice,” defense attorneys wrote, “the Court cannot turn a blind eye to the positions the Government has taken in similar cases.”

Sterling, 47, was convicted in January of nine criminal counts after jurors determined unanimously that he gave classified information to New York Times reporter James Risen about a sensitive operation to put faulty nuclear plans in the hands of Iranian officials. Federal prosecutors earlier this week urged a judge to impose a “severe” sentence and said they felt the U.S. probation office had correctly calculated the range in the federal sentencing guidelines as 19 years 7 months on the low end and 24 years 5 months on the high end.

Such a sentence would have few parallels: The closest might be the 35-year prison term imposed by a military judge on Chelsea Manning, who leaked the largest volume of classified documents in U.S. history. And Sterling’s defense attorneys argued that a prison term within the guidelines would be “plainly excessive,” essentially penalizing Sterling for not taking a plea deal. “Mr. Sterling was convicted, under the Espionage Act, for ‘leaking’ information to a reporter,” defense attorneys wrote. “He should be treated similarly to others convicted for the same crimes and not singled out for a long prison sentence because he elected to exercise his right to a trial.”

Defense attorneys pointed to two similar cases in which alleged leakers reached plea agreements and avoided decades behind bars. Former CIA officer John Kiriakou, who revealed the name of another covert officer, was ultimately sentenced to 30 months in prison, and former State Department arms expert Stephen Jin-Woo Kim, who leaked classified information to a Fox News reporter, was ultimately sentenced to 13 months in prison, defense attorneys argued. They argued that Petraeus, who lied to the FBI, reached a deal to avoid prison entirely. “Mr. Sterling should not receive a different form of justice than General Petraeus,” Sterling’s defense attorneys wrote.

Prosecutors have characterized Sterling’s case as “unique” and argued that the harm he caused to national security was grave. They have argued that Sterling, motivated by “pure vindictiveness,” leaked details that compromised one of the nation’s few ways to deter Iran’s nuclear ambitions, and in doing so, put a Russian scientist who was working with the CIA in danger....

Sterling is scheduled to be sentenced May 11.

April 24, 2015 in Federal Sentencing Guidelines, Offense Characteristics, White-collar sentencing, Who Sentences? | Permalink | Comments (1) | TrackBack

Why the US Sentencing Commission's moderate moderation of fraud guidelines has few fans

This new Huffington Post piece, headlined "Why Nobody Is Really Happy With New Guidelines For Punishing White-Collar Criminals," provides an effective review of why the US Sentencing Commissions new amendments to the fraud guidelines is not garnering widespread praise. Here are excerpts:

A federal panel voted earlier this month to amend the guidelines that federal judges use when sentencing people who commit economic crimes. But few are happy with those changes: Sentencing reform advocates say they don't go far enough to fix draconian sentences, while the U.S. Department of Justice contends that the changes could give some white-collar criminals a new avenue for unfair leniency.

Recommended sentences for economic crimes under the current rubric are so severe, they are no longer taken seriously, some prosecutors and judges suggest. Those guidelines have relied on complicated calculations involving criminal gain and inflicted losses that spit out sentences that can appear inconsistent or absurd. One federal New York judge called the math "hocus-pocus." In 2008, for example, a federal judge sentenced a 72-year-old man to 330 years in prison for an investment scam.

The U.S. Sentencing Commission is responsible for coming up with the road map that federal judges can use when issuing these sentences. On April 9, the commission approved new guidelines, which now will be submitted to Congress and will go into effect in November, unless lawmakers intervene.

Chief Judge Patti Saris, who chairs the commission, contended last week that the economic crime guidelines are not broken, but has acknowledged that they could provide more clarity on what to do in the cases of certain first-time, low-level offenders. The changes aim to make punishments more fair by giving greater weight to a criminal's role and his or her intent....

In March, the Justice Department came out against some of these changes, in favor of more targeted reforms. DOJ is worried that the intent clarification could allow white-collar criminals to claim they never meant to hurt anyone. A fraudster running a Ponzi scheme who is caught early, for example, could argue that he hoped the scheme wouldn't fail.

It makes sense that the Justice Department would want to preserve the option to impose harsher sentences in certain cases. Frank Bowman, a professor at the University of Missouri School of Law who has commented on the draft guidelines, said that from DOJ's perspective, stringent guidelines can give them leverage when negotiating plea bargains.

But some legal experts argue that the Obama administration is missing the point in this case. "All we want to do is make guidelines such that a federal prosecutor can actually look a federal judge in the face and say, 'Impose these guidelines as written,'" Bowman said. If the guidelines had more credibility, he added, judges might be more inclined to follow them and hand down stronger sentences. "The Justice Department is cutting off its nose to spite its face," he said.

Mark Holden, senior vice president and general counsel for Koch Industries, told The Huffington Post that he considered the commission's emphasis on offender intent "a positive development and consistent with the Bill of Rights." He added that the guidelines "are an effort to make the punishment fit the crime," but that more needs to be done on criminal justice reform overall....

Advocates say that when it comes to sentencing reform, there are parallels between drug crimes and economic crime. Mary Price, general counsel for Families Against Mandatory Minimums, asked, "Do we just count drugs, or do we look at [the harm] people really intended? How much harm did they cause? … Are they the courier or the mastermind?" She added that she was disappointed with the pending changes to the economic crime guidelines, calling them "rather minimal."

Prior related posts:

April 24, 2015 in Federal Sentencing Guidelines, Offense Characteristics, White-collar sentencing, Who Sentences? | Permalink | Comments (1) | TrackBack

Thursday, April 23, 2015

Should judge follow federal prosecutors' recommendation of no prison time for CIA leaker David Petraeus?

Petraeus-broadwellThe question in the title of this post is prompted by the sorted story surrounding the criminal misdeeds of former CIA director David Petraeus.  This press report, with the subheadline "Former CIA director and military commander expected to plead guilty to sharing government secrets with his biographer and lover, Paula Broadwell," provide the backstory leading up to this afternoon's sentencing of a high-profile federal defendant:

A scandal that began to unravel in Charlotte ends in Charlotte on Thursday when former CIA Director David Petraeus is expected to admit sharing top government secrets with his biographer and lover.

Under a February agreement with prosecutors, Petraeus, 62, will plead guilty to one count of unauthorized removal and retention of classified material, a misdemeanor that carries a maximum sentence of one year in prison and a $100,000 fine. The government will recommend that punishment for the former commanding general in Iraq and Afghanistan be limited to two years’ probation and a $40,000 fine.

U.S. Magistrate Judge David Keesler, who will preside over Petraeus’ hearing, is not bound by the plea deal. But legal experts say judges typically give great weight to such agreements.

Critics say the retired general is getting off light, given how zealously the Obama administration has pursued government leaks. By comparison, CIA analyst and case officer John Kiriakou, the whistleblower who revealed the secret CIA torture program, is serving a 30-month sentence. Open-government groups say President Barack Obama’s lieutenants have prosecuted more leakers than the rest of U.S. administrations combined.

“It’s hard to reconcile cases like that, and it leads to the conclusion that senior officials are held to a different and more forgiving standard than others,” said Steven Aftergood, director of the Project on Government Secrecy for the Federation of American Scientists in Washington, D.C.

The case against Petraeus, a former Obama confidant, has apparently troubled the administration from the start. The New York Times reported earlier this year that Attorney General Eric Holder was resisting the recommendations of his staff to charge Petraeus with a felony that could have led to possible prison time.

Petraeus resigned three days after Obama’s 2012 re-election. Up to then, the retired four-star general was among the most respected military leaders of modern times. He was sometimes mentioned as a future presidential or vice presidential candidate.

That all began to change three years ago. Paula Broadwell of Charlotte had already written “All In,” Petraeus’ biography. But in May 2012, the West Point graduate began sending a series of anonymous emails disparaging Jill Kelley of Tampa, Fla. Kelley was a friend of Petraeus and other military leaders. Broadwell, documents say, considered her a romantic rival.

Using “Tampa Angel” and at least one other pseudonym, Broadwell sent some of her emails from the old Dilworth Coffee shop on East Boulevard. Within weeks, the FBI had traced the messages back to Broadwell. In June 2012, agents visited the Dilworth home she shares with her husband, radiologist Scott Broadwell, and their two children. A search of her email accounts uncovered the affair. Prosecutors say Broadwell’s computer housed classified information that went far beyond her security clearance as a major in the Army Reserve.

Petraeus resigned as CIA director on Nov. 9, 2012. Court documents filed by acting U.S. Attorney Jill Rose of Charlotte and others say Petraeus shared eight “black books” with Broadwell that he compiled in Afghanistan. Prosecutors say the books held everything from secret codes and the identities of covert officers, to war strategy and notes from National Security Council meetings. Broadwell kept the books for at least four days beginning in August 2011, prosecutors say. The FBI later seized the books during an April 2013 raid on Petraeus’ home.

Petraeus lied to investigators about both having classified information and sharing it with Broadwell, according to court documents. Prosecutors say none of the classified material appeared in Broadwell’s book.

I am troubled by the appearance of disparate favorable treatment being shown to Petraeus, especially given how serious his offense conduct seems and his lies to investigators (which could have been charged as obstruction of justice).  Unfortunately, I do not think federal prosecutors have ever explained — or will ever have to explain — just why they gave Petraeus a seemingly "sweetheart" deal (every pun intended there).  Without any such explanation from federal prosecutors concerning how they exercised their charging and bargaining discretion in this case, it is difficult for me to make an informed judgment on the sentence being recommended by prosecutors for the former CIA director.

UPDATE: This CNN piece reports on the outcome via its headline: "Petraeus sentenced: 2 years probation; $100K fine." By Theodore Schleifer,

April 23, 2015 in Celebrity sentencings, Offender Characteristics, Offense Characteristics, White-collar sentencing, Who Sentences? | Permalink | Comments (6) | TrackBack

Tuesday, April 14, 2015

Tough (and record-long) sentences for cheating Atlanta school administrators

Images (7)As reported in this lengthy USA Today article, "3 in Atlanta cheating scandal to serve 7 years prison," today was final sentencing day in a high-profile and seemingly unique state white-collar criminal case from Georgia.  Here are the details (with my emphasis added):

In a testy courtroom Tuesday, a judge presided over the sentencing of 10 former Atlanta public school educators convicted of participating in a widespread conspiracy to cheat on state tests, telling three defendants that they would serve seven years in prison.

Despite the contentions from Sharon Davis-Williams' and Tamara Cotman's lawyers that they had maintained their innocence and are first offenders, Judge Jerry Baxter of Fulton County Superior Court said that each is being sentenced to 20 years in prison, will serve 7 years of incarceration with the balance as probation and also must do 2,000 hours of community service and pay a $25,000 fine.

"She's convicted, and she's at the top of the food chain," Baxter said of Davis-Williams, who along with Cotman and Michael Pitts were regional directors in the city's school system during one of the country's largest cheating scandals. "Your client ran numerous fine educators out. She non-renewed them."

Pitts received the same sentence and also was sentenced to five years, to run concurrently, on a charge of influencing a witness. The sentences were higher than prosecutors' recommendations.

Although Baxter initially did not want to consider the top administrators as first offenders, he decided to allow that status for all 10. That will allow each to have their convictions erased upon completion of their sentences.

Two of those convicted, former testing coordinator Donald Bullock and former teacher Pamela Cleveland, decided to take a plea deal that prosecutors had offered. Cleveland became the only one of the former educators to elude jail time.

Any deals required an acceptance of responsibility from the former educators, District Attorney Paul Howard said. Bullock, who took the deal before Tuesday's hearing, was sentenced to five years probation, will serve six months in jail on weekends, give 1,500 hours of community service and pay a $5,000 fine.

Cleveland, who apologized in court, was sentenced to five years probation including one year 7 p.m.-to-7-a.m. home confinement, 1,000 hours of community service and a $1,000 fine. Prosecutors took into consideration her elderly parents, so she will be able to serve her home confinement at their house or any hospital where either might be a patient.

Bullock also will apologize and both waived their right to appeal. All were sentenced Tuesday after the judge in the case gave them extra time to negotiate deals with prosecutors.

The former educators' community service will be served at Atlanta's jail teaching inmates, some of whom are the victims of the problems in Atlanta's school system, Baxter said. "I think there were hundreds, thousands of children who were harmed," the judge said. "That's what gets lost in all of this."

Some of the defendants' lawyers pushed back at the expectation of a deal being reached, causing Baxter to cut them off and say he was ready to deliver his sentences immediately. He had delayed sentencing after learning that Howard had been talking to defense attorneys and thought the case could be resolved with sentencing deals. "I just wanted them to get a taste of it," Baxter said of the sentences he had in mind after he quickly delivered Davis-Williams' and Cotman's punishment. "Apparently, that didn't quite move them."

In an exchange with Pitts' lawyer, Baxter said he was worried that some of those convicted were more remorseful that they were caught than they were about cheating young students out of an education. "They should have rose up and said no," the judge said of pressure to alter standardized test scores. "They didn't, and here we are."

The former educators were convicted April 1 on a racketeering charge. Some faced additional charges. They had been accused of falsifying test results to collect bonuses or keep their jobs in Atlanta Public Schools. In all, 35 educators were indicted in 2013 on charges including racketeering, making false statements and theft. Many pleaded guilty and some testified at the trial.

A state investigation found that as far back as 2005, educators fed answers to students or erased and changed answers on tests after they were turned in. Evidence of cheating was found in 44 schools with nearly 180 educators involved, and teachers who tried to report it were threatened with retaliation.

This is fascinating stuff both with respect to sentencing procedure and sentencing outcomes, especially because it seems that the failure to show remorse and waive rights to appeal explains the length of the various sentences as much, if not more, than the actual criminal conduct.  Wowsa (and perhaps the basis for some interesting future appeal issues).

As the title to this post indicates, I would guess these sentences are harshest ever given to cheating school administrators.  That said, it does seem the behavior here was maybe the worst, long-running examples of school cheating ever prosecuted criminally.

April 14, 2015 in Offender Characteristics, Offense Characteristics, Procedure and Proof at Sentencing, White-collar sentencing, Who Sentences? | Permalink | Comments (12) | TrackBack

Friday, April 10, 2015

Basic report on basic changes to fraud guidelines promulgated by US Sentencing Commmission

Though the US Sentencing Commission's vote yesterday to revise the fraud sentencing guidelines is very big news for white-collar sentencing in future high-profile federal cases (basic here), this notable sentencing reform got very little news attention.  Here are excerpts from this Reuters piece with the most fulsome coverage I have seen:

A federal judicial panel on Thursday adopted new guidelines for sentencing white-collar criminals in fraud cases, in an effort to make punishments more fairly reflect the harm suffered by victims and the intent of offenders to cause harm. The changes approved by the U.S. Sentencing Commission will take effect on Nov. 1 unless Congress objects.

They follow years of criticism from defense lawyers and some judges who say federal sentencing guidelines have led to overly severe punishments, potentially reaching life in prison, because they emphasize financial losses such as from falling stock prices. Judges need not follow the guidelines, but must consider them. "These amendments emphasize substantial financial harms to victims rather than simply the mere number of victims and recognize concerns regarding double-counting and over-emphasis on loss," said Chief Judge Patti Saris of the federal court in Massachusetts, who chairs the commission.

The changes call for "intended" losses to reflect financial harm that defendants "purposely sought to inflict," and give judges greater discretion in factoring actual losses in stocks, bonds or commodities into punishments. They also permit greater punishments when even just one or a few people suffer "substantial financial hardship" from fraud, while current guidelines emphasize the number of victims, even if their losses are small. Another change adjusts fraud losses for inflation for the first time.

The U.S. Department of Justice had expressed concern that the new definition of intended loss could let defendants claim they never intended to financially harm anyone. It also said an inflation adjustment could negate the "overwhelming societal consensus" favoring tougher punishments for fraud, and reduce the length of typical sentences by roughly one-fourth. On the other hand, the Justice Department welcomed the greater focus on actual harm inflicted. A Justice Department spokesman declined to comment on Thursday.

David Debold, a Gibson, Dunn & Crutcher partner who led an advisory group to the commission, said the changes on balance "tend to make sentences more fair" in fraud cases. "They make punishment better reflect the harm that defendants actually intended," he said. "That's an important change, and a good one."

Prior related post:

April 10, 2015 in Federal Sentencing Guidelines, White-collar sentencing, Who Sentences? | Permalink | Comments (2) | TrackBack

Thursday, April 09, 2015

US Sentencing Commission votes to amend fraud guidelines (but not really "fix" that much)

As reported in this official press release, "United States Sentencing Commission voted today to adopt changes to the fraud guideline to address longstanding concerns that the guidelines do not appropriately account for harm to victims, individual culpability, and the offender’s intent. The Commission also voted to change the drug quantity table to account for the rescheduling of hydrocodone." Here are some details from the press release concerning this important federal white-collar sentencing news:

The Commission altered the victim enhancement in the fraud guideline to ensure that where even one victim suffered a substantial financial harm, the offender would receive an increased sentence. It also made changes to refocus economic crime penalties toward the offender’s individual intent, while maintaining an underlying principle of the fraud guideline that the amount of loss involved in the offense should form a major basis of the sentence.

“We found through comprehensive examination that the fraud guideline provides an anchoring effect in the vast majority of cases, but there were some problem areas, particularly at the high-end of the loss table,” said Chief Judge Patti B. Saris, chair of the Commission. “These amendments emphasize substantial financial harms to victims rather than simply the mere number of victims and recognize concerns regarding double-counting and over-emphasis on loss.”

The Commission also acted today to provide additional guidance as to which offenders are eligible to receive a reduced sentence as a minor or minimal participant in an offense. “This change is intended to encourage courts to ensure that the least culpable offenders, such as those who have no proprietary interest in a fraud, receive a sentence commensurate with their own culpability without reducing sentences for leaders and organizers,” Saris said....

The Commission also made an adjustment to monetary tables to account for inflation. This goodgovernment measure derives from a methodology provided by Congress and will have an effect on both penalty and fine tables.  The amendments will be transmitted to Congress by May 1, 2015. If Congress does not act to disapprove some or all of the amendments, they will go into effect November 1, 2015.  More information about this process and the amendments approved today will be available on the Commission’s web site at www.ussc.gov.

At the USSC's website, one can now find this "Preliminary 'Reader-Friendly' Version of Amendments. Though "reader-friendly," the amendments themselves do not really provide a complete picture of just how much these amendments, assuming they are not disapproved by Congress, could impact guideline-sentencing ranges in future high-loss white-collar cases.  In addition, and of perhaps particular interest to some currently incarcerated  defendants, the Commission has to my knowledge not yet indicated in any formal documents whether, when and how it might consider making these amendment retroactive in a manner that might impact past high-loss white-collar cases.

IMPORTANT FRAUD AMENDMENT RETROACTIVITY UPDATE: A helpful colleague who was able to watch the USSC meeting and votes provided this report on the topic of the potential retroactivity of these amendments:

At the end of the hearing, USSC staff brought up the question of retroactivity and said a motion would be appropriate at this time if the Sentencing Commission wanted the staff to conduct a retroactivity impact analysis. USSC Chair Saris asked whether anyone wanted to make such a motion and no one did. Saris then read a brief statement saying they have a statutory obligation to consider whether any amendments should be retroactive, and they had determined in this case that for these amendments that would not be appropriate.

Notably, if Congress was truly eager to help with prison-crowding problems by doing something for some notable non-violent offenders, I think Congress could provide by statutory direction either that the amendments be made retroactive in whole or in part (or it might at least direct that the Commission consider more fully whether these amendments be made retroactive in whole or in part). Also, back in 2007, when the crack guidelines were first adjusted downward slightly, the Commission did not take up the retroactivity issue until many months after it promulgated amendments lowering the guidelines. But, I suspect absent some significant advocacy by the white-collar defense bar, the die may be already permanently cast against any even partial retroactivity of these new fraud amendments.

April 9, 2015 in Federal Sentencing Guidelines, Sentences Reconsidered, White-collar sentencing, Who Sentences? | Permalink | Comments (9) | TrackBack

Wednesday, April 08, 2015

Terrific review of possible USSC fraud guideline amendments (and DOJ's foolish opposition)

As detailed in this official notice, the US Sentencing Commission has a public meeting scheduled for tomorrow, April 9, 2015, at 1:00 pm (which is to be live-streamed here). The big agenda item of note for the meeting is the "Vote to Promulgate Proposed Amendments," and the most consequential amendments being considered concerns proposals to tweak § 2B1.1, the key guideline for fraud cases and many other white-collar offenses.  

I doubt the actual USSC meeting will be a must-see event, though I have urged my sentencing students to tune in.  (I plan to watch the meeting live on my iPad while also keeping an eye on another notable on-going event in Augusta, Georgia.)  But I have a must-read for anyone interested in white-collar federal sentencing: this fantastic Jurist commentary by Prof Randall Eliason titled "The DOJ Opposition to the Proposed Sentencing Guideline Amendments: Fighting the Wrong Battles in Fraud Cases." The entire commentary is a must-read (with lots of great links) for all federal sentencing fans, and here are a few choice excerpts:

On March 12, 2015, the US Sentencing Commission held a public hearing on its annual proposed amendments to the Federal Sentencing Guidelines. A number of the proposals concern the guideline for economic crimes and fraud cases, § 2B1.1. The amendments would reduce the recommended sentence in many such cases, particularly those involving large dollar amounts.

At the hearing the US Department of Justice opposed most of these amendments. DOJ argued that any move to reduce the sentences in fraud cases would be bad policy and would ignore the "overwhelming societal consensus" in favor of harsh punishment for these crimes.... But given the current realities of federal sentencing, DOJ is fighting the wrong battles....

At the March 12 hearing DOJ opposed the inflation adjustment; opposed the amendments concerning sophisticated means, intended loss, and fraud on the market; and supported the new enhancement based on causing victims substantial hardship. In other words, DOJ opposed virtually any amendment that could lead to lower sentences while supporting changes that could lead to higher ones. While this may seem predictable, I think it's a mistake.

DOJ was a lonely voice at the hearing and is definitely swimming against the tide by opposing the amendments. There is a widespread and growing belief that the sentences called for in major fraud cases have become excessive. More broadly, there is an emerging bipartisan movement in the country favoring criminal justice reform, including measures to reduce skyrocketing sentences (particularly for non-violent offenders) and our enormous prison population.

Law professor Frank Bowman provided some compelling hearing testimony tracing the history of the fraud guideline and demonstrating how various forces, both intentional and unintentional, have combined over the years to escalate the sentences in such cases dramatically. As he pointed out, given the large dollar values involved in some recent Wall Street frauds, it's relatively easy for a white-collar defendant to zoom to the top of the sentencing table and end up with a recommended sentence of 30 years or even life in prison—on a par with sentences recommended for homicide, treason, or a major armed bank robbery.

DOJ's resistance to virtually any amendment that might lead to lower sentences in economic crime cases appears short-sighted and runs the risk of looking reflexive. The Sentencing Commission has researched these questions for several years, gathering input from all stakeholders. The proposals seem reasonable and justified, and in fact are more modest than many had hoped.

It's hard to see what criminal justice purpose is being served by the escalating sentences in fraud cases. The prospect of prison does have a powerful and important deterrent effect that is unique to criminal law. But for a typical business executive it's hard to believe there's much additional marginal deterrent value in a possible twenty or twenty-five year sentence as opposed to, say, a fifteen year one.

But the more important fact is that legal developments have rendered DOJ's position in favor of higher guidelines sentences increasingly beside the point. It's been ten years since the Supreme Court ruled in US v. Booker that the mandatory sentencing guidelines were unconstitutional and the guidelines must be advisory only. Later in Kimbrough v. US the Court made it clear that a judge is free to depart from the recommended sentence if the judge disagrees with a policy decision underlying the guidelines.

In this legal environment, DOJ's push for higher guidelines looks like a struggle to keep the barn door closed when the horse left for greener pastures long ago. In the post- Booker/Kimbrough world, if judges believe a sentence called for by the guidelines is out of whack they will simply reduce it. For example, in the recent public corruption case involving former Virginia Governor Robert McDonnell, the judge called the recommended guidelines sentence of six to eight years in prison "ridiculous" and proceeded to sentence McDonnell to only two years.

There's evidence that the same thing is already happening in fraud cases. According to the Sentencing Commission's data, judges sentence below the recommended guidelines range in about 21 percent of fraud cases (not counting those cases where the government itself requests a reduced sentence). But in the Southern District of New York, home to Wall Street and many of the big-dollar fraud cases, judges depart below the guidelines in a whopping 45.6 percent of such cases. It does no good for DOJ to continue to push for extremely high guidelines numbers only to have judges ignore the guidelines and impose the lower sentences that they feel are just and reasonable.

DOJ's approach is worse than futile, it's counter-productive. The more that judges come to regard the guidelines as calling for inappropriate sentences, the more comfortable they may become not following them. This could lead to more widespread departures from the guidelines not merely in fraud cases but in cases across the board, accelerating a deterioration in the force and influence of the guidelines that so far has been held relatively in check since Booker.

April 8, 2015 in Federal Sentencing Guidelines, Offense Characteristics, Procedure and Proof at Sentencing, Purposes of Punishment and Sentencing, Scope of Imprisonment, White-collar sentencing, Who Sentences? | Permalink | Comments (1) | TrackBack

Wednesday, March 25, 2015

You be the judge: what federal sentence for modern sheriff playing Robin Hood?

ImagesIn the legend of Robin Hood, the Sheriff of Nottingham is the tale's primary villain. But this sentencing story out of South Carolina raises the question of what federal sentence ought to be given to a local sheriff who was committing fraud as a kind of modern Robin Hood. The press report is headlined "Convicted Williamsburg sheriff asks for sentencing leniency," and here are the details:

The convicted former sheriff of Williamsburg County should be sentenced to less than the three years in prison recommended by federal officials because he succeeded despite a troubled upbringing and is being treated for a painkiller addiction, his lawyer said.

Ex-sheriff Michael Johnson faces a judge Wednesday to learn his fate after a federal jury convicted him in September of mail fraud. Prosecutors said Johnson created hundreds of fake police reports for a friend who ran a credit repair business so people could claim their identities were stolen and get out of credit card debt. The sentencing recommendation for Johnson is 30 months to 37 months in prison, according to court papers filed this week.

Johnson's attorney said that is too harsh for a man with no criminal record who cooperated with authorities. Johnson's request asks for a lesser sentence, but is not specific. Johnson has suffered from depression and anxiety the past four years. He also has migraines, high blood pressure and insomnia, lawyer Deborah Barber said in court papers.

The former sheriff also was raised in a broken home, saw his mother abused by a boyfriend and left at age 17 to relieve her of financial burden, Barber said. "He resided in a poverty-stricken area in Kingstree, South Carolina, with the family not having enough money to adequately survive," Barber wrote....

Johnson joined the Williamsburg County Sheriff's Office in 1997, two years after graduating high school and rose to chief deputy, becoming sheriff in April 2010 when the former sheriff, Kelvin Washington, was named U.S. Marshal for South Carolina.

He is one of nine sheriffs in South Carolina's 46 counties to be charged or investigated while in office since 2010. Seven have pleaded guilty or been convicted, and another died while under investigation. Only two of those sheriffs so far have been sentenced to prison.

Intriguingly, this long earlier article explains some of the details of the fraud, and it suggests that sheriff Johnson may not have made any money from the scheme designed to help people to (falsely) improve their credit rating. I am disinclined to assert that sheriff Johnson is as noble or heroic as Robin Hood, but it does seem like his fraud involved trying to help some folks down on their luck by pulling a fast one on the (big bad monarchy?) credit companies. Given that the federal sentencing guidelines still call for a prison term of at least 2.5 years, I am now wondering what the real Robin Hood might have been facing in a federal fraud guideline range if he were facing sentencing today.

March 25, 2015 in Offender Characteristics, Offense Characteristics, Procedure and Proof at Sentencing, Purposes of Punishment and Sentencing, White-collar sentencing | Permalink | Comments (2) | TrackBack

Thursday, March 19, 2015

Sentencing judgment days this week in federal court for two pols behaving very badly

Two prominent politician faced federal sentencing for two distinct crimes this week.  Here are headlines reflecting the outcome for each on judgment day along with links to stories providing the details:

March 19, 2015 in Offender Characteristics, White-collar sentencing | Permalink | Comments (1) | TrackBack

Saturday, March 14, 2015

Reviewing DOJ's opposition to any fraud guideline amendments

This Reuters article, headlined "Justice Department objects to white-collar sentencing reforms," details that the US Department of Justice is not too keen on proposed reformed to the federal sentencing guidelines for fraud offenses. Here are the excerpts:

The U.S. Justice Department has come out broadly against a series of proposals from a federal panel that would cut prison time for white-collar criminals. The department's views, revealed on Thursday at a hearing of the U.S. Sentencing Commission, marked a potential setback for the proposals, which defense lawyers had already criticized for being too moderate.

In a letter released at the meeting, the department objected to a proposal to adjust victim losses for inflation for the first time since 1987. Losses directly influence recommended prison term lengths, and the move would reduce fraud sentences by 26 percent on average. "It seems a somewhat odd thing to do," Benjamin Wagner, the U.S. Attorney for the Eastern District of California, said at the hearing.

The Justice Department also objected to a proposal to shift the emphasis in calculating sentences for stock fraud cases to financial gains instead of investor losses, a change that could reduce the amount of prison time some executives would face. The department's position came amid continuing debate over whether changes to the guidelines are necessary to address what even some judges have said are overly harsh recommended punishments for fraud offenders.

Fraud offenses constitute the third largest type of federal crime in America, behind only immigration and drugs cases. Over the last decade, average prison sentences for fraud have lengthened three-fold, the commission said. But after the U.S. Supreme Court declared the guidelines advisory in 2005, judges increasingly gave shorter terms than what the commission recommended. In 2012, the average fraud sentence was 22 months, compared to the 29-month minimum recommended, the commission said.

Critics say the data shows many judges view the guidelines as overly-driven by victim losses, at times resulting in potential life sentences in cases like stock frauds with high-dollar amounts.

The commission's proposals, released in January, were viewed as too moderate by groups like the American Bar Association, which had pushed for broader revision de-emphasizing the influence losses have not just in cases involving the stock market but also for other frauds, such as in mortgages and healthcare. Still, the commission said its proposal to adjust the loss calculations for inflation would itself reduce sentence lengths.

The Justice Department said any reduction would be contrary to "overwhelming societal consensus." Several commissioners, though, appeared skeptical of the department's position.

Prior related posts:

March 14, 2015 in Federal Sentencing Guidelines, White-collar sentencing, Who Sentences? | Permalink | Comments (1) | TrackBack

Friday, March 13, 2015

Utah establishes criminal registry for white-collar offenders

Via this New York Times piece, I see that Utah has extended the idea of a criminal registry to fraudsters. Though I have reservations about criminal registries for a variety of reasons, I think this particular kind of registry might make a lot of sense as a recidivism/crime prevention measure.  Here is how this fascinating story gets started:

With just a point and a click, you can browse a face book of felons, a new government website that will warn of the danger these criminals pose to society. Only these are not the faces of sex offenders and serial killers. These criminals are mortgage schemers and inside traders, most likely armed with nothing more than an M.B.A. or a law degree.

Their faces will soon appear online courtesy of the Utah Legislature, which on Wednesday approved a measure to build the nation’s first white-collar offender registry, appending a scarlet letter of sorts on the state’s financial felons.  The registry — quirky even by the standards of a legislature that this week reinstated firing squads as a method of execution — will be replete with a “a recent photograph” of Utah’s white-collar offenders and, in case they try to run or hide, their “date of birth, height, weight, and eye and hair color.”

“White-collar crime is an epidemic in Utah,” said Sean Reyes, the state’s attorney general who formulated the idea for the registry when he was a defense lawyer, “representing some of these bad guys.” A former mixed martial arts fighter who has a metal plate lodged in his eye socket from a basketball injury, Mr. Reyes noted that while violent crimes were devastating, many “physical wounds heal,” whereas white-collar crimes “can forever deplete your life savings.”

While some Utah lawmakers fear that the registry is overkill, the idea does tap into a vein of populist outrage over financial misdeeds. As much as sex offender registries spread state by state, so too could a white-collar crime registry find favor across the nation, say its supporters.

The legislation’s sponsor in the Utah Senate, Curtis S. Bramble, a Republican, plans to promote the idea through his role as president-elect of the National Conference of State Legislatures, an influential group, saying that “the registry could become a best practices for other states.”

March 13, 2015 in Collateral consequences, Criminal Sentences Alternatives, Procedure and Proof at Sentencing, Purposes of Punishment and Sentencing, White-collar sentencing, Who Sentences? | Permalink | Comments (11) | TrackBack

Thursday, March 12, 2015

US Sentencing Commission hearing on proposed fraud and other guideline amendments

Download (2)Today, as detailed at this webpage with the official agenda, the US Sentencing Commission is holding a public hearing to receive testimony from invited witnesses on proposed amendments to the federal sentencing guidelines. This event is being streamed live (for the first time, I think), and can be watched at this link.

This webpage with the official agenda also provides links to the submitted written testimony of the scheduled witnesses. Most of the interesting conceptual and technical debate about guideline amendments this cycle are focused on the fraud guidelines, which have been subject to an array of criticisms due especially to their severity in cases including significant "loss" calculations. But, as the Department of Justice's written testimony (available here) makes the case that there is nothing really broken in the fraud guideline that needs to be fixed:

Lessening penalties for economic crime would be contrary to the overwhelming societal consensus that exists around these offenses. All three branches of government have expressed a belief that the sentences for fraud offenses are either appropriate or too low....

The Department also feels that penalties for economic crimes should remain unchanged and not be decreased. The proportionality established between loss and offense level is based upon numerous policy considerations, including how economic crimes should be punished and deterred. In the Department's experience and judgment, the harm from economic crimes is generally not being overstated.

In notable contrast, the written testimony of Professor Frank O. Bowman, III (available here) has a very different take on the realities of the fraud guidelines:

[F]or the last decade or so, the loudest complaint about §2B1.1 has been that it prescribes sentences which, at least for some defendants, are far too high. In particular, many observers have argued that for some high-loss defendants the guidelines now are divorced both from the objectives of Section 3553(a) and, frankly, from common sense....

Accordingly, one would have expected the proposed 2015 amendments to §2B1.1 to concentrate on the class of high-loss offenders the Commission seems to agree are over-punished by the guidelines. Curiously, however, the proposed amendments – though in several cases laudable for other reasons – would have virtually no material impact on the guidelines ranges for very high loss offenders, while producing modest guidelines reductions for significant numbers of low-to-moderate-loss offenders.

<P>I agree with the Commission’s basic conclusion that for many, perhaps most, economic offenders the Guidelines do not suggest manifestly unreasonable sentences.  But I also agree with Judge Saris’s implicit conclusion that for many high-loss offenders the fraud guideline is “fundamentally broken.”  The Commission doubtless believes that the modest proposals put forward in this cycle will at least ameliorate the high-loss offender problem. Unfortunately, the guidelines for high-loss offenders are so “fundamentally broken” that these modest measures will have no meaningful effect.

March 12, 2015 in Federal Sentencing Guidelines, Offense Characteristics, White-collar sentencing, Who Sentences? | Permalink | Comments (1) | TrackBack

Tuesday, March 03, 2015

"Fishy SOX: Overcriminalization's New Harm Paradigm"

The title of this post is the title of this new paper by Todd Haugh available via SSRN. The piece argues that the recently decided Yates case is more consequential than the standard fish shory. Here is the abstract:

The harms of overcriminalization are usually thought of in a particular way—that the proliferation of criminal laws leads to increasing and inconsistent criminal enforcement and adjudication. For example, an offender commits an unethical or illegal act and, because of the overwhelming depth and breadth of the criminal law, becomes subject to too much prosecutorial discretion and faces disparate enforcement or punishment. But there is an additional, possibly more pernicious, harm of overcriminalization.

Drawing from the fields of criminology and behavioral ethics, this Article makes the case that overcriminalization actually increases the commission of criminal acts themselves, particularly by white collar offenders. This occurs because overcriminalization, by delegitimatizing the criminal law, fuels offender rationalizations. Rationalizations are part of the psychological process necessary for the commission of crime—they allow offenders to square their self-perception as “good people” with the illegal behavior they are contemplating, thereby allowing the behavior to go forward. Overcriminalization, then, is more than a post-act concern. It is inherently criminogenic because it facilitates some of the most prevalent and powerful rationalizations used by would-be offenders. Put simply, overcriminalization is fostering the very conduct it seeks to eliminate. This phenomenon is on display in the recently argued Supreme Court case Yates v. United States. Using Yates as a backdrop, this Article presents a new paradigm of overcriminalization and its harms.

March 3, 2015 in Purposes of Punishment and Sentencing, White-collar sentencing | Permalink | Comments (5) | TrackBack

Friday, February 20, 2015

Virginia's former first lady facing sentencing after hubby got only two years

Today brings another high-profile white-collar sentencing in the federal court in Virginia as Maureen McDonnell, former first lady, is to come before the same judge who sentenced former Virginia Gov Robert McDonnell to two years' imprisonment last month. Helpfully, Randall Eliason at the Sidebars Legal Blog provides this preview, titled "What to Expect at Maureen McDonnell’s Sentencing." Randall provides this refined summary of the guideline basics and the parties' recommendations:

The Presentence Report prepared by the U.S. Probation Department concludes that the Sentencing Guidelines call for a sentence of 63-78 months in prison. The prosecution agrees with those calculations but recommends the judge sentence her to only 18 months in prison to avoid an unwarranted disparity between her sentence and that of her husband. Mrs. McDonnell’s attorneys argue that, properly calculated, the Sentencing Guidelines call for only 33-41 months, but urge the judge to depart even further from the Guidelines and sentence her to probation along with 4000 hours of community service.

In addition, the Washington Post has this article headlined "Everything you need to know about Maureen McDonnell’s sentencing." But that piece does not set out these guideline basics, so the headline is not accurate for hard-core federal sentencing geeks like me.

UPDATE:  As this Washington Post piece reports, "Maureen McDonnell was sentenced Friday to a year and a day in federal prison after an emotional, hours-long hearing in which the former first lady of Virginia apologized publicly for the first time since she and her husband were accused of public corruption."

As all competent federal sentencing lawyers know, a sentence of a year and a day for the former first lady is actually better than a sentence of one year. That extra day makes her formally eligible to earn good-time credit, which nearly all non-violent offenders earn. So, practically, Ms. McDonnell is now likely to be released from federal custody after only 10.5 months in the federal graybar hotel.

February 20, 2015 in Federal Sentencing Guidelines, Offender Characteristics, Offense Characteristics, Procedure and Proof at Sentencing, White-collar sentencing | Permalink | Comments (1) | TrackBack

Thursday, February 05, 2015

You be the judge: what federal sentence for Silk Road creator Ross Ulbricht?

Ross-ulbricht-600x450This Wired article provides the basic story on a notable modern federal defendant who, thanks to a jury verdict yesterday, is now a high-profile convicted felon awaiting sentencing:

A jury has spoken, and the mask is off: Ross Ulbricht has been convicted of being the Dread Pirate Roberts, secret mastermind of the Silk Road online narcotics empire.

On Wednesday, less than a month after his trial began in a downtown Manhattan courtroom, 30-year-old Ulbricht was convicted of all seven crimes he was charged with, including narcotics and money laundering conspiracies and a “kingpin” charge usually reserved for mafia dons and drug cartel leaders.  It took the jury only 3.5 hours to return a verdict.  Ulbricht faces a minimum of 30 years in prison; the maximum is life.  But Ulbricht’s legal team has said it will appeal the decision, and cited its frequent calls for a mistrial and protests against the judge’s decisions throughout the case.

As the verdict was read, Ulbricht stared straight ahead. His mother Lyn Ulbricht slowly shook her head, and his father Kirk put a hand to his temple. After the verdict, Ulbricht turned around to give his family a stoic smile.  “This is not the end,” Ulbricht’s mother said loudly as he was led out of the courtroom. “Ross is a hero!” shouted a supporter.

From his first pre-trial hearings in New York, the government’s evidence that Ulbricht ran the Silk Road’s billion-dollar marketplace under the pseudonym the Dread Pirate Roberts was practically overwhelming.  When the FBI arrested Ulbricht in the science fiction section of a San Francisco public library in October of 2013, his fingers were literally on the keyboard of his laptop, logged into the Silk Road’s “mastermind” account.  On his seized laptop’s hard drive, investigators quickly found a journal, daily logbook, and thousands of pages of private chat logs that chronicled his years of planning, creating and day-to-day running of the Silk Road. That red-handed evidence was bolstered by a college friend of Ulbricht’s who testified at trial that the young Texan had confessed creating the Silk Road to him. On top of that, notes found crumpled in his bedroom’s trashcan connected to the Silk Road’s code.  Ulbricht’s guilty verdict was even further locked down by a former FBI agent’s analysis that traced $13.4 million worth of the black market’s bitcoins from the Silk Road’s servers in Iceland and Pennsylvania to the bitcoin wallet on Ulbricht laptop.

Ulbricht’s defense team quickly admitted at trial that Ulbricht had created the Silk Road. But his attorneys argued that it had been merely an “economic experiment,” one that he quickly gave up to other individuals who grew the site into the massive drug empire the Silk Road represented at its peak in late 2013.  Those purported operators of the site, including the “real” Dread Pirate Roberts, they argued, had framed Ulbricht as the “perfect fall guy.”...

But that dramatic alternative theory was never backed up with a credible explanation of the damning evidence found on Ulbricht’s personal computer.  The defense was left to argue that Ulbricht’s laptop had been hacked, and voluminous incriminating files injected into the computer — perhaps via a Bittorrent connection he was using to download an episode of the Colbert Report at the time of his arrest.  In their closing arguments, prosecutors called that story a “wild conspiracy theory” and a “desperate attempt to create a smokescreen.” It seems the jury agreed.

Despite the case’s grim outcome for Ulbricht, his defense team seemed throughout the trial to be laying the grounds for an appeal.  His lead attorney Joshua Dratel called for a mistrial no less than five times, and was rejected by the judge each time. Dratel’s protests began with pre-trial motions to preclude a large portion of the prosecution’s evidence based on what he described as an illegal, warrantless hack of the Silk Road’s Icelandic server by FBI investigators seeking to locate the computer despite its use of the Tor anonymity software. As the trial began, Dratel butted heads with the prosecution and judge again on the issue of cross-examining a Department of Homeland Security witness on the agency’s alternative suspects in the case, including bitcoin mogul and Mt. Gox CEO Mark Karpeles. And in the last days of the trial, Dratel strongly objected again to a decision by the judge to disallow two of the defense’s expert witnesses based on a lack of qualifications....

Ulbricht will nonetheless be remembered not just for his conviction, but also for ushering in a new age of online black markets.  Today’s leading dark web drug sites like Agora and Evolution offer more narcotics listings than the Silk Road ever did, and have outlived law enforcement’s crackdown on their competitors. Tracking down and prosecuting those new sites’ operators, like prosecuting Ulbricht, will likely require the same intense, multi-year investigations by three-letter agencies.

Though I am not familiar with all the likely sentencing particulars, I would expect a guidelines calculation in this case to be life and that prosecutors will urge a guideline-recommended LWOP sentence. The defense surely will seek the minimum sentence, which in this case is the not-so-minimum 30 years in the federal greybar hotel.

In addition to pursuing their appeal, Ulbricht's defense team might reach out to Brian Doherty at Reason, who has this provocative commentary headlined "Silk Road: Ross Ulbricht's Loss is a Loss for Justice, Liberty, Safety, and Peace: The operation Ulbricht was found guilty of managing was one guaranteed to save lives, reduce real crime, and preserve liberty." Here are excerpts:

[T]he government's multi-year, incredibly expensive attempt to take down the site and prosecute Ulbricht were bad for liberty, bad for markets, bad for the safety of those who choose to use substances the government has declared forbidden, and bad for America....

Ulbricht, if he's guilty of what they tried him for, is guilty of nothing but trying, and for a while succeeding, in doing a good thing for his fellow citizens, the world, and the future. His case will be remembered not as one of stalwart cops saving the world from dangerous crime, but of a visionary martyr punished for the good he did.

The combination of cryptography and Bitcoin are out of the bottle, and what it ultimately means is that the war on drugs is even more hopeless than it always was. But the government seems to never run out of candidates to be the last person to be a victim of that war, a victim of that mistake. May Ulbricht be among the last.

February 5, 2015 in Drug Offense Sentencing, Offense Characteristics, Purposes of Punishment and Sentencing, White-collar sentencing | Permalink | Comments (7) | TrackBack

Friday, January 30, 2015

Notable new commentary on Yates v. US and overcriminalization

Via email I learned about these two notable new commentaries discussing issues surrounding the federal criminal case Yates v. United States soon to be resolved by the Supreme Court:

SOX on Fish: A New Harm of Overcriminalization by Todd Haugh

Going Overboard: Yates and DOJ’s “Most Serious Offense” Charging Policy by Scott Coffina & Edward James Beale

January 30, 2015 in Offense Characteristics, White-collar sentencing, Who Sentences? | Permalink | Comments (5) | TrackBack

Tuesday, January 13, 2015

Brief account of what proposed fraud guideline changes might amount to

This new Reuters article, headlined "U.S. panel proposes changes to white-collar prison sentences," provides a reasonable summary of the likely import and impact of the guideline reform proposes announced by the US Sentencing Commission late last week (discussed here). Here are excerpts:

Some executives and others convicted of stock fraud could face shorter prison terms under a U.S. commission's proposal to change how white-collar criminals are sentenced. The U.S. Sentencing Commission on Friday released proposals to amend advisory federal guidelines that would shift the emphasis in calculating a sentence for frauds on the market to financial gains instead of investor losses.

The proposal follows years of criticism by defense lawyers and some judges who say that the guidelines focus too much on financial losses caused by fraud, leading in certain cases to sentences that are too harsh. Judges have discretion to impose any sentence, but are required to consider the guidelines.

In stock fraud cases, losses can be in the hundreds of millions of dollars, contributing to an advisory sentence of life in prison. Under the commission's proposal, judges in these cases would consider the gains from a fraud, a number defense lawyers say would often be considerably smaller.

The Sentencing Commission has scheduled a March 12 hearing on the proposals. The panel has until May 1 to submit any amendments to Congress. If Congress does not act by Nov. 1, the changes become law....

The commission has proposed setting a threshold sentencing level for gains, ensuring punishment in cases where profits are minimal. Depending on what floor is set, there is a "very good chance a number of cases would result in lower guideline sentencing ranges," said David Debold, a lawyer at Gibson, Dunn & Crutcher who heads up an advisory group to the commission.

Defense lawyers cautioned that the proposed changes would not always result in a lower sentencing range. Some frauds like penny stock manipulation, for example, could involve significant gains to defendants and might still lead to lengthy sentences. Other proposals would affect the weight given to factors such as the harm to victims and the sophistication of a fraud.

Some defense lawyers say the proposals overall do not sufficiently emphasize a defendant's culpability and leaves loss as a driving factor for the bulk of fraud cases involving identity theft, mortgage fraud and healthcare fraud. "These changes don't go nearly as far as we would have liked," James Felman, a Florida lawyer and member of an American Bar Association task force advocating changes to the guidelines.

U.S. District Judge Patti Saris, the commission's chair, said in a statement that the panel did not consider "the guideline to be broken for most forms of fraud," but that its review had identified "some problem areas where changes may be necessary." 

Prior related post:

January 13, 2015 in Federal Sentencing Guidelines, Offense Characteristics, White-collar sentencing, Who Sentences? | Permalink | Comments (2) | TrackBack

Friday, January 09, 2015

US Sentencing Commission proposes (modest but significant) changes to the fraud guidelines

Download (1)As reported in this official news release, the "United States Sentencing Commission voted today to publish proposed guideline amendments, including revisions to the sentencing guideline governing fraud." Here are the basics from the release:

The bipartisan Commission voted to seek comment on a proposed amendment to revise guideline §2B1.1 governing fraud offenses by clarifying the definition of “intended loss,” which contributes to the degree of punishment, and the enhancement for the use of sophisticated means in a fraud offense. The proposed amendment also revises the guideline to better consider the degree of harm to victims, rather than just the number of victims, and includes a modified, simpler approach to “fraud on the market” offenses which involve manipulation of the value of stocks.

The proposed revisions to the fraud guidelines come after a multi-year study, which included a detailed examination of sentencing data, outreach to experts and stakeholders, and a September 2013 symposium at John Jay College of Criminal Justice in New York. “We have heard criticism from some judges and members of the bar that the fraud guideline may be fundamentally broken, particularly for fraud on the market cases,” said Judge Patti B. Saris, Chair of the Commission. “Based on our extensive examination of data, we have not seen a basis for finding the guideline to be broken for most forms of fraud, like identity theft, mortgage fraud, or healthcare fraud, but this review has helped us to identify some problem areas where changes may be necessary.”...

Consistent with the Commission’s mission to make the guidelines more efficient and more effective, the Commission also voted today to clarify the provisions allowing for sentence reductions for offenders with mitigating roles in the offense and the provisions governing jointly undertaken criminal activity.  The Commission similarly proposed adjusting the tables based on amounts of money for inflation in an attempt to keep the guidelines current and follow the approach generally mandated by statute for most civil monetary penalties....

The proposed amendments and issues for comment will be subject to a public comment period running through March 18. A public hearing on the proposed amendments will be scheduled in Washington, D.C., on March 12. More information about these hearings, as well as a data presentation on today’s proposed fraud amendment and other relevant data, will be available on the Commission’s web site at www.ussc.gov.

Here are links to new materials already posted on the USSC website this afternoon:

As the title of this post indicates, these new proposed amendments strike me as relatively modest but still quite significant. Most notably, the white-collar defense bar is likely to be very interested in what these changes signal and suggest, and any federal fraud defendants currently serving very long guideline sentences may want to start thinking about whether these proposed amendments might help their cause if they are formally adopted and thereafter made retroactive.

January 9, 2015 in Federal Sentencing Guidelines, Offense Characteristics, White-collar sentencing, Who Sentences? | Permalink | Comments (3) | TrackBack

Tuesday, January 06, 2015

Former Virginia Gov McDonnell gets (way-below-guideline) sentence of two years in prison

As reported here by the Washington Post, a "federal judge sentenced former Virginia governor Robert F. McDonnell to two years in prison Tuesday — a term far lower than what prosecutors had sought and one that means the popular politician will be free before his 63rd birthday." Here is more:

U.S. District Judge James R. Spencer said he was moved by the outpouring of support for McDonnell, though he could not ignore the jury’s verdict. “A price must be paid,” Spencer said. “Unlike Pontius Pilate, I can’t wash my hands of it all.  A meaningful sentence must be imposed.”

The penalty is a win for defense attorneys, who had asked that the former governor be sentenced to mere community service even as prosecutors initially advocated for a prison term stretching longer than a decade.  The U.S. probation office had determined that federal sentencing guidelines called for a term of incarceration between 10 years and a month and 12 years and seven months.

Spencer ordered the former governor to report to prison on Feb. 9. Though McDonnell (R) will certainly appeal his conviction, the sentence brings to a close a stunning narrative of politics, greed and family drama that reached a climax in September when McDonnell, 60, and his wife, Maureen, were convicted of public corruption. A jury found unanimously that the couple used the governor’s office to help a wealthy dietary supplement company executive advance his business interests, and in exchange, the businessman gave the McDonnells $177,000 in loans, gifts and luxury goods.

January 6, 2015 in Celebrity sentencings, White-collar sentencing | Permalink | Comments (3) | TrackBack

Monday, January 05, 2015

Previewing (and predicting) federal sentencing prospects for former Virginia Gov McDonnell

The Washington Post has this lengthy article, headlined "What to expect at former Virginia governor Robert McDonnell’s sentencing," providing an effective preview of a high-profile white-collar sentencing taking place in federal court tomorrow. Here are highlights:

As a federal judge on Tuesday sets the punishment for former Virginia governor Robert F. McDonnell, he will consider legal issues as well as sweeping personal questions.  U.S. District Judge James R. Spencer will look first to guidelines that call for McDonnell to receive as much as 12 years and seven months for trading the influence of his office to a smooth-talking businessman in exchange for sweetheart loans, lavish vacations and high-end merchandise.

But the judge is not bound by those recommendations.  And his ultimate decision rests, in part, on intangible considerations: How serious was McDonnell’s public corruption?  What penalty might deter others in the former governor’s shoes?  What weight should be given to the good the former governor has done?...

rosecutors want McDonnell to spend at least 10 years and a month in prison.  The former governor’s attorneys believe a sentence of community service — and no time behind bars — would be sufficient.

Both sides will make their best pitches to the judge in person beginning at 10 a.m. McDonnell may offer a personal plea, as may some of his supporters.  Spencer has been given more than 440 letters that friends, family members and others wrote on the governor’s behalf, urging leniency and extolling the virtues of the onetime Republican rising star.  Spencer also has reviewed filings from prosecutors, who have accused McDonnell of feeling no remorse and still seeking to blame others....

The starting point for determining the former governor’s punishment is this: The U.S. probation office — the federal agency tasked with calculating a range of appropriate penalties according to the federal sentencing guidelines — has recommended that McDonnell face between 10 years and a month to 12 years and seven months in prison. There is no parole in the federal system, and if McDonnell were to be incarcerated, he would be able to reduce his time behind bars with good behavior by only 54 days a year, at most.

Spencer is not bound by the probation office’s recommendation — it is merely a technical calculation of how the office believes federal sentencing guidelines should be applied in the case — but experts say he typically heeds its advice....

After Spencer determines the guideline range, he will weigh entirely different factors as he fashions what he considers an appropriate punishment.  Among those that prosecutors and defense attorneys highlighted in McDonnell’s case: the nature and circumstances of his offenses, McDonnell’s personal history and characteristics, and the need to deter others from ending up in similar straits....

A former prosecutor and Judge Advocate General’s Corps officer, Spencer was appointed to the court by President Ronald Reagan in 1986.  Known as a no-nonsense and efficient jurist, he took senior status on the bench last year, meaning he is now semi-retired.  Jacob Frenkel, a former federal prosecutor who now does white collar criminal defense work, said Spencer probably will not impose a decade-long sentence, but defense attorneys’ bid for only probation is something of a “Hail Mary.”

I share the view that it is unlikely McDonnell will get either probation as he wishes or the 10 years in prison sought by the feds. As a betting man, I would put the over-under line at around three years. The nature of the crime and the defendant leads me to think the sentencing judges will be likely to impose a substantial prion term, but still something less (perhaps much less) than half a decade.

Prior related posts:

UPDATE: I just discovered that Randall Eliason at his Sidebars Legal Blog has this lengthy post about the McDonnell sentencing which provides much more detailed review of the interesting guideline calculation issues that are in dispute in the case.  

January 5, 2015 in Federal Sentencing Guidelines, Offense Characteristics, Procedure and Proof at Sentencing, White-collar sentencing | Permalink | Comments (1) | TrackBack