Authors: Gregory Herrold and Eric Boden
Tackling complex and evolving issues surrounding sentencing in federal fraud cases, a panel of distinguished jurists and white collar practitioners shared their thoughts at this year’s ABA White Collar Conference in San Diego, California in a discussion titled: “Effective Sentencing Advocacy – Guidelines, Mitigation, and Data.” The panel, including U.S. District Court Judges Charles Breyer and Trina Thompson of the Northern District of California, explored mitigation strategies defense counsel should implement early in a client’s criminal justice process to most effectively advocate for an appropriate sentence.
Strategies for Mitigation and Advocacy – Challenging the Loss Amount and Sentencing Policies
The panel emphasized loss amount as the single largest component of the court’s calculation of the Guidelines range, making it the natural starting point for defense advocacy. Panelists identified several avenues through which practitioners can challenge or contextualize this figure.
First, the panel encouraged counsel to scrutinize the government’s loss calculation for mathematical or methodological errors. As highlighted during the discussion, there are multiple ways to calculate loss, and the chosen methodology can dramatically affect the outcome. One panelist pointed to the prosecution of embattled Theranos founder Elizabeth Holmes, commenting that arguing for diminution of the investment amount over the actual amount invested often is a more accurate—and lower—measure of the economic loss inflicted.
Second, the panel advised practitioners to carefully examine applicable exclusions from the loss calculation, such as interest, which ordinarily under the Guidelines does not apply to the loss calculation.
Third, the panel suggested that attorneys should consider policy-based arguments to attack the guideline itself, thereby avoiding any appearance of downplaying a defendant’s conduct or dismissing any harm to victims. The fraud guidelines (U.S.S.G. Sec. 2B1.1) have drawn criticism from many district judges, including Judge Breyer, who remarked during the panel that the loss table makes “little sense,” noting that—unlike the tables for many other criminal offenses—the current, operative version of the fraud loss table was not empirically derived but instead evolved over time, largely as a reaction by the Sentencing Commission to punish fraud more severely in the wake of Sarbanes–Oxley. Indeed, as the panel observed, the Sentencing Commission over the last several decades has increasingly added considerably more levels at similar loss amounts to a defendant’s exposure while also introducing additional enhancements, effectively doubling down on the impetus to sentence financial fraud defendants more severely. The ABA published a “shadow guideline” in 2015 that offers an alternative framework, as one panelist observed, evaluating culpability in a “more meaningful way” and providing a useful reference point for defense arguments.
Finally, the panelists noted that sentencing now involves a two-step process, allowing practitioners to move to their best variance arguments under the 18 U.S.C. § 3553(a) factors immediately after the court’s Guideline range calculation. No longer will an attorney have to struggle through the often awkward and cumbersome former Step Two analysis addressing technical, guideline-based departures.
Judge Breyer offered a practical tip for those attorneys assessing a criminal defendant’s likely sentencing exposure in a fraud case: when the loss amount is even slightly complicated, counsel should request a hearing on the loss calculation before the date of sentencing. By increasing the time between the loss determination and the broader sentencing hearing, counsel can “ameliorate the impact of the loss” and take the steam out of the bottom-line number. After the loss amount is determined, defense counsel then can return—preferably days or weeks later—to advocate for their client under the Section 3553(a) factors.
That said, defense counsel should always remain mindful of their audience. Not every judge will be receptive to the argument that the Guidelines themselves are fundamentally flawed. Counsel therefore should have a Plan B: even if the court declines the invitation to question the Fraud Guideline’s validity, it may still be receptive to the argument that the defendant’s conduct was only minimally responsible for the overall loss.
Personalization and Mitigation: Telling the Defendant’s Story
Effective sentencing advocacy goes well beyond the numbers. Panelists emphasized that personalizing the defendant—telling the court who they are and why they ended up before a sentencing judge—is equally critical.
One presenter outlined a comprehensive mitigation approach that begins well before the sentencing hearing. Practitioners should engage proactively during the U.S. Probation Office’s Presentence Investigation Report stage, ideally by providing the assigned Probation Officer with supportive documents including character letters, a statement from the defendant demonstrating remorse, documentation of military service, and relevant medical history, including letters from clinicians with diagnoses regarding mental or other health issues. The earlier these materials are submitted to the Probation Officer, the more impactful they are toward shaping the narrative about who the defendant is and who the defendant is not. Waiting until the filing of the sentencing memorandum—or the sentencing hearing itself—to introduce the court to your client leaves the judge little time to form a meaningful understanding of who the defendant is. Defense counsel should also speak with their client early in the process about their client’s remorse, personal growth, and lessons learned, as these aspects will inform the court’s assessment of any need to impose a sentence to achieve the goals of both specific and general deterrence. Character letters on behalf of the defendant should be solicited by counsel well in advance of sentencing. These letters should be organized around consistent themes that reinforce the narrative that the defendant is a person whose conduct as reflected in the charging instrument or plea agreement was aberrant from who the defendant is over a lifetime of good conduct.
Where the defendant has the ability to pay restitution, doing so is a straightforward way to improve the defendant’s position at sentencing. Additionally, while many practitioners consider victims to be adverse to the defense’s sentencing goals, counsel should explore whether any victims might be willing to provide supportive letters on the defendant’s behalf, while being mindful of any bail conditions prohibiting such conduct.
Insights from the Bench: What Judges Want to See
The judicial perspective offered during the panel was particularly illuminating. Practitioners were reminded to not overlook the presence of victims in the courtroom. Indeed, as Judge Thompson remarked, sentencing is not solely about the defendant; equally important is the presence of victims, whether physically in the courtroom or represented in impact statements submitted to the court. The panelists also advised attorneys (especially in high profile cases) to have a keen understanding of how their case is being treated in the media, so as to distinguish what their case is from what it is not.
Judges Breyer and Thompson also noted that courts are often moved by a defendant’s post-arrest conduct, including efforts between the date of arrest and the date of sentencing to better oneself and repair the community affected by the defendant’s conduct. However, Judge Thompson urged counsel to make reasonable sentencing requests, and not ask for a sentence so unreasonable that the attorney loses credibility and undermines the seriousness of the defendant’s advocacy. Such pie-in-the-sky requests serve only to hamper the court’s ability to fashion an appropriate sentence.
Judge Breyer remarked that while he enters a sentencing hearing with a strong and well-informed sense of the defendant and the defendant’s conduct, he remains open to persuasion. Judge Breyer also offered several suggestions for counsel:
- Defendants should not make statements at sentencing if there is any risk they will make the situation worse.
- Victim testimony has an “enormous impact” on the court, and if defense counsel can separate the timing of the victim’s statement from the sentencing hearing, that break often serves to mitigate the impact.
- Attorneys should take risks in their advocacy. Judge Breyer expressed frustration with lawyers who present bland, risk-averse arguments rather than focusing on what will genuinely move the sentencing judge.
Leveraging JSIN Data and Sentencing Research
The panelists uniformly endorsed counsel’s use of the Sentencing Commission’s Judicial Sentencing Information (JSIN) platform, an online tool created by the Commission in 2021 that provides sentencing data for similarly situated defendants. JSIN allows practitioners to filter by Guidelines’ section and access nationwide sentencing data for similarly situated defendants based on their Guidelines’ ranges and criminal history categories. This data can be instrumental in framing what could constitute an appropriate sentence for a particular defendant, and allows counsel to assess what an appropriate sentence might look like given sentences imposed by other courts for similar conduct.
Attorneys (and judges) should utilize JSIN and other useful tools provided by the Sentencing Commission and other online legal research platforms to further develop their understanding and awareness regarding how defendants are sentenced nationwide for fraudulent conduct.
Conclusion
The insight shared during this panel underscores a central theme: effective sentencing advocacy in federal fraud cases demands rigorous preparation, creative argumentation, and a deep understanding of the data, the guidelines, and the individual sentencing judge. Practitioners who invest the time to challenge inflated loss calculations, build a compelling personal narrative for their clients, and leverage tools like JSIN to ground their arguments in empirical reality will be best positioned to achieve favorable outcomes.
If you have any questions about the sentencing strategies discussed in this post or if you require guidance in connection with a pending federal fraud matter, please contact any of the attorneys in our White Collar Criminal Defense and Investigations practice.
Disclaimer: This alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice.