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Potentially Gentler Sentences For White Collar Criminals

10/7/2010 Articles

Published as a Guest Column on Law360. 

On Nov. 1, absent congressional intervention, several amendments to the federal sentencing guidelines will go into effect that may positively impact sentencing determinations for individual white collar defendants.

Notably, the guidelines' sentencing table will be significantly amended for the first time in 18 years, increasing the availability of nonincarceration sentences and partial imprisonment split-sentences for nonviolent defendants, including those convicted of white collar crimes.

The amendments also introduce a change in the prescribed impact on sentencing of certain individual characteristics of defendants, suggesting, in a departure from prior policy, that these characteristics may now be considered as a basis for departing downward or in imposing nonimprisonment or split-sentences.

The amendments further reflect the U.S. Sentencing Commission's express acknowledgment that sentencing decisions must consider all of the factors in 18 U.S.C. Section 3553(a), generally considered since the 2005 Booker decision to be a more defendant-friendly part of the sentencing analysis.

Coming on the heels of several years of appellate-level and U.S. Supreme Court sentencing decisions post-Booker, the overall effect of which has been an easing up on sometimes harsh and overly mechanical sentencing determinations under the guidelines, the current wave of amendments signals a move by the commission to embrace the increased post-Booker exercise of judicial discretion in sentencing to the benefit of individual defendants.

Guidelines Background

Promulgated pursuant to the Sentencing Reform Act of 1984, the federal sentencing guidelines are a set of rules issued by the U.S. Sentencing Commission to promote uniformity in sentencing for federal crimes including felonies and serious misdemeanors.

Though the 2005 Supreme Court decision in U.S. v. Booker, 543 U.S. 220 (2005), made the guidelines advisory, rather than mandatory, the guidelines are still a statutorily mandated and important consideration in every sentencing decision in federal court today.

Under the guidelines, a defendant's offense level is calculated based on a number of factors, including the type and severity of the crime as well as the defendant's role in carrying it out, along with other applicable offense characteristics called "enhancements."

Once the offense level is calculated, the length of the guidelines sentence is derived by reference to the sentencing table, which accords sentence ranges (in number of months) to various offense levels depending on a defendant's criminal history.

The sentencing table is divided into four zones, labeled A through D and including various offense levels. Sentences within zone A are the least severe, in the range of zero to six months for those with a criminal history category of zero to one, while zones B, C and D sentences are progressively more severe, up to life imprisonment at an offense level of 43 in zone D.

Zones Expanded

The 2010 guideline amendments will expand the availability of alternative incarceration sentences by adjusting the sentencing table itself, a key component of the guidelines that has remained unchanged since 1992.

The amendments will adjust the zones of the sentencing table, thus impacting one of the most important variables affecting the type of sentence available at various offense levels.

Currently, for offense levels within zone A (levels one to eight, including sentences of zero to six months for those with a criminal history category of zero to one) and zone B (levels nine and 10, including sentences of four to 12 months for those with a criminal history category of zero to one), the guidelines expressly permit home confinement, community confinement, confinement in halfway houses or other alternatives to prison as part or all of the sentence.

Within zone C (levels 11 and 12, currently including sentences of eight to 16 months for those with a criminal history of zero to one), sentences may include these alternatives to incarceration, provided that at least half of the minimum term of the applicable guideline range includes a period of imprisonment.

The 2010 amendments will expand zones B and C by one offense level each. After Nov. 1, nonimprisonment sentences will thus be available to those with an offense level up to a level 11, an eight- to 14-month sentence for those with a criminal history category of zero to one.

Split-sentences under zone C will also be available to defendants with offense levels of up to 13, a 10- to 18-month sentence for those at the lowest criminal history category.

To put it another way: As a result of the changes, defendants with sentences of up to 18 months at level 13 may now be eligible for split-sentences rather than being required to serve their entire sentences in prison, and defendants with sentences of up to 14 months at level 11 may be eligible to serve their entire sentences with no prison time, i.e., straight probation or probation with conditions of confinement that do not include prison, such as home detention or a halfway house.

Not only will the expansion of zones B and C of the sentencing table result in the availability of split and nonimprisonment sentences for defendants with lengthier sentences, but the commentary underlying the amendments may be useful as a part of the sentencing discussion in nearly all white collar criminal-defense cases.

The expansion of the zones is the result of a study the sentencing board commissioned to examine alternatives to incarceration. The commission cited two reasons for conducting the study:

  • "Renewed public debate about the size of the federal prison population," including from all three branches of government.
  • "The need for greater availability of alternatives to incarceration for certain nonviolent first offenders."

As the vast majority of white collar defendants are in this latter category, this part of the commentary may be useful in defense of most such cases.

The commission's study considered federal sentencing data, feedback from the public in general as well as judges, recent scholarly literature, current federal and state practices and a two-day national symposium on prison alternatives.

The commission also cited sentencing practicalities, such as the fact that many zone D defendants facing a potential sentencing range of 12 to 18 months often receive a sentence of a year and a day, meaning that with credits for good behavior, they end up serving only 10 1/2 months.

As the commission recognized, those zone D defendants are effectively being sentenced as though they were in zone C.

Though these changes can be significant to defendants with offense levels of 11 to 13, the expansion of the zones stands to impact a relatively small percentage of defendants overall.

As part of its study, the commission determined that, had the new amendments been in place, approximately 3.8 percent of zone D defendants in 2009 would have been in zone C, and 2.2 percent of zone C defendants would have been in zone B.

Not all of these defendants would have been eligible for nonincarceration alternatives for various reasons, including statutory ineligibility for probation or immigration detainers.

As a result, the study concluded, only approximately 2 percent of defendants will be directly affected by the expansion of the zones. And although these amendments would have had an arguably significant impact on sentencing for some number of defendants already incarcerated, it appears unlikely that the amendments will be given retroactive effect as the changes do not appear to fall within the narrow definition of retroactively applicable amendments to sentencing ranges under U.S.S.G. Section 1B1.10.

Despite the relatively limited direct effect of the zone expansion on the overall population of federal defendants, the amendments signal a policy shift towards a decreased focus on incarceration and a willingness to acknowledge that nonincarceration alternatives can meet the goals of sentencing.

The policy language behind the zone changes may thus be relevant outside the relatively small number of defendants directly affected.

In fact, amendments to Section 1B1.1(b) of the guidelines specifically direct a sentencing court to consider, in sentencing, "policy statements or commentary in the guidelines that might warrant consideration in imposing sentence."

Commentary by the commission placing an increased emphasis on nonincarceration sentences would certainly appear to warrant such consideration, particularly for defendants with offense levels in or near the relevant zones.

Recognition of Section 3553(a) Factors

The Supreme Court's decision in Booker, in rendering the guidelines advisory rather than mandatory, placed an increased emphasis on the nonguideline sentencing factors set forth in 18 U.S.C. Section 3553(a), including "the nature and circumstances of the offense and the history and characteristics of the defendant" as well as goals of deterrence, protection of the public and the provision of needed educational, correctional or medical care to defendants.

What has resulted since Booker is a bipartite analysis by sentencing courts: first of the applicable guidelines calculations, and then of the Section 3553(a) factors, generally considered to permit a wider exercise of judicial discretion in favor of defendants.

The 2010 amendments for the first time will introduce into the guidelines an explicit recognition of the importance of the Section 3553(a) factors as a part of sentencing.

Newly amended Section 1B1.1, "application instructions," directs a sentencing court to apply a three-step process in sentencing, already in use by courts in most circuits following Booker.

Courts are directed first to determine the applicable guideline range and then, second, to consider whether upward or downward departures are warranted within the guidelines framework.

Third, an entirely new subsection directs sentencing courts to "consider the applicable factors in 18 U.S.C. Section 3553(a) taken as a whole."

The commentary to the newly amended rule incorporates language from Section 3553(a) often emphasized by defense attorneys: that sentences must be "sufficient, but not greater than necessary" to comply with the purposes of sentencing.

This amendment may further signal that the commission itself recognizes that the rigid application of guidelines calculations in sentencing determinations is a thing of the (increasingly distant) past.

Expanded Scope of the Specific Characteristics of the Defendant That May Be Considered

While the 2010 amendments recognize the importance of the Section 3553(a) factors including "the history and characteristics of the defendant" in sentencing, they also seek to promote the uniform application of these factors by defining, through a series of policy statements and related commentary, the scope of "specific offender characteristics" that may be considered in determining whether a downward departure is warranted, or whether, within the options available under the appropriate zone of the sentencing table, a sentence should be comprised of either probation or imprisonment.

In a reversal from former versions of the guidelines, these specific offender characteristics may now be considered, where relevant to sentencing, as a basis for sentences outside the applicable guidelines range or for nonimprisonment sentences in zones A to C "if the characteristic, individually or in combination with other such characteristics, is present to an unusual degree and distinguishes the case from the typical cases covered by the guidelines."

The characteristics that may be considered include age, mental and emotional conditions, physical condition or appearance and military service.

As in prior guidelines versions, while not ordinarily relevant, the applicable policy statement appears to leave open the possibility that "civic, charitable or public service; employment-related contributions; and similar prior good works" could, in an unusual case, also be considered.

Conclusion

While the extent to which the 2010 guidelines amendments will change sentencing determinations for individual white collar defendants remains to be seen, several of the amendments appear to provide for the exercise of greater leniency in sentencing.

By encouraging the imposition of nonimprisonment sentences, recognizing the relatively pro-defendant language of Section 3553(a) and increasing the scope of specific offender characteristics that may be considered in granting departures under the guidelines, the commission is signaling an acceptance of the sentencing courts' increased post-Booker discretion to fashion nonimprisonment sentences to match white collar and other nonviolent defendants' individual characteristics, while maintaining the policy goal of sentencing uniformity at the heart of the guidelines themselves.

Jessica Nall ([email protected]) is a partner in Farella Braun's San Francisco office in the white collar crime and internal corporate investigations group. Anne-Catherine Padian ([email protected]), an associate in the firm's San Francisco office, also contributed to this guest column.

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