Does Money Play Too Large a Role in Federal Sentencing?


Does money, specifically the dollar loss that victims suffer from a fraud or other crime, count for too much in federal sentencing?

A recent American Bar Association conference on federal sentencing guidelines saw a top Justice Department official and a federal district judge sharply disagree about whether the U.S. Sentencing Guidelines involve unfair discrimination in white-collar cases by adding to the length of a sentence because of loss calculations. Speaking at the Nov. 5, 2010, event were Jonathan Wroblewski, the Director of the Office of Policy and Legislation of DOJ’s Criminal Division, and U.S. District Judge Jed Rakoff of the Southern District of New York.

Judge Rakoff’s comments echoed the arguments made in our earlier posting and by other blogs like this WSJ blog posting discussing the huge impact of financial loss in the pending sentence for former KB Home CEO Bruce Karatz that the guidelines take the amount of loss into account far more than they should.

Judge Rakoff, himself a former federal prosecutor of financial crimes, said he recently sentenced two white-collar defendants very differently. One got a relatively lenient sentence because he “was a very decent human being who towards the end of a fraud perpetrated mostly by other people, became involved and made a mistake and covered it up.” The other was “an evil person, who spent his whole life doing bad things and culminating in a fraud that he was totally the centerpiece of and he deserved to rot in jail a much longer time.”

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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