In prosecutions for economic and financial crimes in the federal criminal justice system, the sentence a defendant faces depends on the amount of money that was lost because of the crime. However, a quirk in the sentencing guidelines has led to some confusion over the years. The sentencing guidelines instruct judges to look at both the actual loss caused and the loss the defendant intended to cause, even if he or she was not successful in obtaining full amount. In practice, this has allowed some prosecutors to argue for a longer sentence than would otherwise be called for under the guidelines.
Recently, the U.S. Court of Appeals for the 10th Circuit cleared up some of the confusion around intended loss. In the case called U.S. v. Manatau, the defendant agreed to plead guilty to charges of bank fraud and identity theft. Because he pleaded guilty, the only issue for the trial judge to decide was the defendant’s sentence.
The actual losses in the case amounted to about $1,800 dollars that the defendant allegedly obtained by cashing convenience checks that were attached to credit card accounts. However, the convenience checks were attached to credit card accounts that had combined credit limits of more than $40,000.
At trial, federal prosecutors convinced a judge to use the credit limit on the accounts to calculate the defendant’s intended loss. The defendant argued that his intended loss was in the range of $10,000 to $30,000, which would warrant a lower sentence. The defendant appealed the judge’s ruling to the 10th Circuit, and the 10th Circuit agreed with the defendant.
Noting that the defendant was not even aware of the credit limits associated with some of the checks he had in his possession, the 10th Circuit found that the trial judge made a mistake by looking solely at the credit limits of the accounts in question. The 10th Circuit vacated the defendant’s sentence and sent the case back to the trial court, where the judge will need to calculate the intended loss by looking at what the defendant actually intended, instead of merely looking at the credit limits of the accounts.
Source: U.S. v. Manatau, 10-4101, (10th Cir. 2011)