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Lighter sentences sought for some business crimes

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The federal panel that sets sentencing policy eased penalties this year for potentially tens of thousands of nonviolent drug offenders. Now, defense lawyers and prisoner advocates are pushing for similar treatment for a different category of defendants: swindlers, embezzlers, insider traders and other white-collar criminals.

Lawyers who have long sought the changes say a window to act opened once the U.S. Sentencing Commission cleared a major priority from its agenda by cutting sentencing guideline ranges for drug crimes. The commission, which meets Thursday to vote on priorities for the coming year, already has expressed interest in examining punishments for white-collar crime. And the Justice Department, though not advocating wholesale changes, has said it welcomes a review.

It's unclear what action the commission will take, especially given the public outrage at fraudsters who stole their clients' life savings and lingering anger over the damage inflicted by the 2008 financial crisis. But the discussion about tweaking sentences for economic crimes comes as some federal judges have chosen to ignore the existing guidelines as too stiff for some cases and as the Justice Department looks for ways to cut costs in an overpopulated federal prison system.

Sentencing guidelines are advisory rather than mandatory, but judges still rely heavily on them for consistency's sake. Advocates arguing that white-collar sentencing guidelines are "mixed up and crazy" could weaken support for keeping them in place, said Ohio State University law professor Douglas Berman, a sentencing law expert.

The commission's action to soften drug-crime guidelines is a signal that the time is ripe, defense lawyers say.

Just as drug sentences have historically been determined by the amount of drugs involved, white-collar punishments are typically defined by the total financial loss caused by the crime. Advocates hope the commission's decision to lower sentencing guideline ranges for drug crimes, effectively de-emphasizing the significance of drug quantity, paves the way for a new sentencing scheme that removes some of the weight attached to economic loss.

A 2013 proposal from an American Bar Association task force would do exactly that, encouraging judges to place less emphasis on how much money was lost and more on a defendant's culpability. Under the proposal, judges would more scrupulously weigh less-quantifiable factors, including motive, the scheme's duration and sophistication, and whether the defendant actually financially benefited or merely intended to.

The current structure, lawyers say, means bit players in a large fraud risk getting socked with harsh sentences despite playing a minimal role.

"It's real easy to talk about 10, 15, 20 years, but when you realize just how much time you're talking about ... it's too much," said Washington defense lawyer Barry Boss, an ABA task force member.

No one is seeking leniency for imprisoned financier Bernie Madoff, who's serving a 150-year sentence for bilking thousands of people of nearly $20 billion, or fallen corporate titans whose greed drove their companies into the ground. But defense lawyers are calling for a sentencing structure that takes into account the broad continuum of economic crime and that better differentiates between, for example, thieves who steal a dollar each from a million people versus $1 million from one person.

Any ambitious proposal will encounter obstacles.

It's virtually impossible to muster the same public sympathy for white-collar criminals as for crack-cocaine defendants sentenced under old guidelines now seen as excessively harsh, which took a disproportionate toll on racial minorities. The drug-sentencing overhaul also was promoted as fiscally prudent, because drug offenders account for roughly half the federal prison population. Tea Party conservatives and liberal groups united behind the change.

In comparison, the clamor for changing white-collar guidelines has been muted. The Justice Department, already criticized for its paucity of criminal prosecutions arising from the financial crisis, has said it's open to a review but has not championed dramatic change.

"I don't think there's a political will for really cutting back or retooling the guidelines," said Columbia University law professor Daniel Richman.

The commission's last major change to the economic crime guidelines came more than a decade ago, when it stiffened penalties. But as fraud sentences have increased, some judges have deviated from the guidelines to impose terms far more lenient than the government's recommendations. One judge, Frederic Block of the Eastern District of New York, cautioned in 2008 that the guidelines should not be a "black stain on common sense."

When some adhere to the guidelines but others don't, critics say, the result can be as haphazard as if guidelines didn't exist at all.

In Manhattan, U.S. District Judge Jed Rakoff, an outspoken critic of the guidelines, in 2012 sentenced former Goldman Sachs director Rajat Gupta to two years in prison on insider-trading changes, about one-fifth the government's recommended sentence. And in Florida, Judge James S. Moody Jr. sentenced a group of health care executives in May to sentences so lenient that he acknowledged prosecutors might think "that I've lost my mind."

A former Wall Street trader convicted of abusing a government bailout program could have received a double-digit sentence under the guidelines but got two years instead. The Connecticut judge who imposed the sentence last month, Janet C. Hall, called the guidelines unhelpful "because the loss aspect of the crime, in effect, overwhelms all the other aspects."

Washington lawyer Barry Pollack, an officer of the National Association of Criminal Defense Lawyers, said while the commission could let the guidelines stand, he hopes for some movement.

"I think the real question is will they take the lesser and easier step of simply reducing sentences across the board, or will they use this as an opportunity to revisit the entire philosophy behind the white-collar sentencing guidelines," he said. "I think only time will tell on that."

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  1. I have been on this program while on parole from 2011-2013. No person should be forced mentally to share private details of their personal life with total strangers. Also giving permission for a mental therapist to report to your parole agent that your not participating in group therapy because you don't have the financial mean to be in the group therapy. I was personally singled out and sent back three times for not having money and also sent back within the six month when you aren't to be sent according to state law. I will work to het this INSOMM's removed from this state. I also had twelve or thirteen parole agents with a fifteen month period. Thanks for your time.

  2. Our nation produces very few jurists of the caliber of Justice DOUGLAS and his peers these days. Here is that great civil libertarian, who recognized government as both a blessing and, when corrupted by ideological interests, a curse: "Once the investigator has only the conscience of government as a guide, the conscience can become ‘ravenous,’ as Cromwell, bent on destroying Thomas More, said in Bolt, A Man For All Seasons (1960), p. 120. The First Amendment mirrors many episodes where men, harried and harassed by government, sought refuge in their conscience, as these lines of Thomas More show: ‘MORE: And when we stand before God, and you are sent to Paradise for doing according to your conscience, *575 and I am damned for not doing according to mine, will you come with me, for fellowship? ‘CRANMER: So those of us whose names are there are damned, Sir Thomas? ‘MORE: I don't know, Your Grace. I have no window to look into another man's conscience. I condemn no one. ‘CRANMER: Then the matter is capable of question? ‘MORE: Certainly. ‘CRANMER: But that you owe obedience to your King is not capable of question. So weigh a doubt against a certainty—and sign. ‘MORE: Some men think the Earth is round, others think it flat; it is a matter capable of question. But if it is flat, will the King's command make it round? And if it is round, will the King's command flatten it? No, I will not sign.’ Id., pp. 132—133. DOUGLAS THEN WROTE: Where government is the Big Brother,11 privacy gives way to surveillance. **909 But our commitment is otherwise. *576 By the First Amendment we have staked our security on freedom to promote a multiplicity of ideas, to associate at will with kindred spirits, and to defy governmental intrusion into these precincts" Gibson v. Florida Legislative Investigation Comm., 372 U.S. 539, 574-76, 83 S. Ct. 889, 908-09, 9 L. Ed. 2d 929 (1963) Mr. Justice DOUGLAS, concurring. I write: Happy Memorial Day to all -- God please bless our fallen who lived and died to preserve constitutional governance in our wonderful series of Republics. And God open the eyes of those government officials who denounce the constitutions of these Republics by arbitrary actions arising out capricious motives.

  3. From back in the day before secularism got a stranglehold on Hoosier jurists comes this great excerpt via Indiana federal court judge Allan Sharp, dedicated to those many Indiana government attorneys (with whom I have dealt) who count the law as a mere tool, an optional tool that is not to be used when political correctness compels a more acceptable result than merely following the path that the law directs: ALLEN SHARP, District Judge. I. In a scene following a visit by Henry VIII to the home of Sir Thomas More, playwriter Robert Bolt puts the following words into the mouths of his characters: Margaret: Father, that man's bad. MORE: There is no law against that. ROPER: There is! God's law! MORE: Then God can arrest him. ROPER: Sophistication upon sophistication! MORE: No, sheer simplicity. The law, Roper, the law. I know what's legal not what's right. And I'll stick to what's legal. ROPER: Then you set man's law above God's! MORE: No, far below; but let me draw your attention to a fact I'm not God. The currents and eddies of right and wrong, which you find such plain sailing, I can't navigate. I'm no voyager. But in the thickets of law, oh, there I'm a forester. I doubt if there's a man alive who could follow me there, thank God... ALICE: (Exasperated, pointing after Rich) While you talk, he's gone! MORE: And go he should, if he was the Devil himself, until he broke the law! ROPER: So now you'd give the Devil benefit of law! MORE: Yes. What would you do? Cut a great road through the law to get after the Devil? ROPER: I'd cut down every law in England to do that! MORE: (Roused and excited) Oh? (Advances on Roper) And when the last law was down, and the Devil turned round on you where would you hide, Roper, the laws being flat? (He leaves *1257 him) This country's planted thick with laws from coast to coast man's laws, not God's and if you cut them down and you're just the man to do it d'you really think you would stand upright in the winds that would blow then? (Quietly) Yes, I'd give the Devil benefit of law, for my own safety's sake. ROPER: I have long suspected this; this is the golden calf; the law's your god. MORE: (Wearily) Oh, Roper, you're a fool, God's my god... (Rather bitterly) But I find him rather too (Very bitterly) subtle... I don't know where he is nor what he wants. ROPER: My God wants service, to the end and unremitting; nothing else! MORE: (Dryly) Are you sure that's God! He sounds like Moloch. But indeed it may be God And whoever hunts for me, Roper, God or Devil, will find me hiding in the thickets of the law! And I'll hide my daughter with me! Not hoist her up the mainmast of your seagoing principles! They put about too nimbly! (Exit More. They all look after him). Pgs. 65-67, A MAN FOR ALL SEASONS A Play in Two Acts, Robert Bolt, Random House, New York, 1960. Linley E. Pearson, Atty. Gen. of Indiana, Indianapolis, for defendants. Childs v. Duckworth, 509 F. Supp. 1254, 1256 (N.D. Ind. 1981) aff'd, 705 F.2d 915 (7th Cir. 1983)

  4. "Meanwhile small- and mid-size firms are getting squeezed and likely will not survive unless they become a boutique firm." I've been a business attorney in small, and now mid-size firm for over 30 years, and for over 30 years legal consultants have been preaching this exact same mantra of impending doom for small and mid-sized firms -- verbatim. This claim apparently helps them gin up merger opportunities from smaller firms who become convinced that they need to become larger overnight. The claim that large corporations are interested in cost-saving and efficiency has likewise been preached for decades, and is likewise bunk. If large corporations had any real interest in saving money they wouldn't use large law firms whose rates are substantially higher than those of high-quality mid-sized firms.

  5. The family is the foundation of all human government. That is the Grand Design. Modern governments throw off this Design and make bureaucratic war against the family, as does Hollywood and cultural elitists such as third wave feminists. Since WWII we have been on a ship of fools that way, with both the elite and government and their social engineering hacks relentlessly attacking the very foundation of social order. And their success? See it in the streets of Fergusson, on the food stamp doles (mostly broken families)and in the above article. Reject the Grand Design for true social function, enter the Glorious State to manage social dysfunction. Our Brave New World will be a prison camp, and we will welcome it as the only way to manage given the anarchy without it.

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