White
Collar Case Analysis
April
16, 2007
The
decision is significant in two respects: reemphasizing that the court will not
accept probation-only sentences for large-scale white collar criminals; and adding
to the list of factors that are not permissible grounds for a below-guideline
sentence.
In
U.S. v. Wallace, 458 F.3d 606 (7th Cir. 2006), the district court imposed a probation-only
sentence, even though the guideline range was 24-30 months imprisonment, and the
amount of intended loss from a wire fraud scheme exceeded $400,000. The court
of appeals reversed.
The
court also cited several decisions from other circuits, vacating probation-only
sentences for white collar criminals.
Several
months later, in U.S. v. Repking, 467 F.3d 1091 (7th Cir. 2006), the court vacated
the one-day prison sentence that a white collar criminal received for a bank fraud
involving from $600,000 to $1 million in losses.
In
the two cases, the court held that a variety of considerations were impermissible
grounds for a below-guideline sentence: charitable works; pre-charge payment of
restitution; and that actual loss was far less than intended loss.
To
this list can now be added the following: the incurring of significant attorney
fees in defending against the charge; misconduct (alleged or otherwise) on the
part of the prosecution; protracted prosecution; and the defendant’s “ineptness
as a businessman.”
In this
case, the court found there was not even an arguable violation of Brady v. Maryland,
373 U.S. 83 (1963), prompting the court to dismiss the claim as “hover[ing]
on the border of cloud-cuckooland.”
However,
even if there had been a real violation of Brady, the opinion precludes leniency
for the defendant, by opining, “as for governmental misconduct, nothing in
section 3553(a) suggests that punishing the government is a proper goal of sentencing;
two wrongs don’t make a right.”
The
court’s holding that incurring extensive attorney fees is not a permissible
ground for a below-guideline sentence is also consistent with the only other courts
that have considered the issue.
In
U.S. v. Chastain, 84 F.3d 321, 323-24 (9th Cir. 1996), a pre-Booker case, the
Ninth Circuit held that this ground did not justify a reduction in the guideline
range. More recently, in U.S. v. Vigil, — F.Supp.2d —, 2007 WL654559
(D.N.M., Feb. 13, 2007), the court also held that the defendant’s incurring
several hundred thousand dollars in attorney fees does not justify a reduced sentence.
Click
here for Main Story.
David
Ziemer can be reached by email.
