DOJ Sentencing Commission Letter

U.S.
Department of Justice
Criminal Division
Office of the Assistant Attorney General Washington, DC 20530
29, 2014
The Honorable Patti B. Saris, Chair
United States Sentencing Commission
One Columbus Circle, NE
Suite 2-500, South Lobby
Washington, DC 20002-8002
Dear Judge Saris:
The Sentencing Reform Act of requires the Criminal Division to submit to the
United States Sentencing Commission, at least annually, a report commenting on the operation
of the sentencing guidelines, suggesting changes to the guidelines that appear to be warranted,
and otherwise assessing the Commission's work. 28 U.S.C. 994(o) (2006). We are pleased to
submit this report pursuant to the Act. The report also responds to the Commission's request for
public comment on its proposed priorities for the guideline amendment year ending May 1,
Notice of Proposed Priorities and Request for Public Comment, 79 Fed. Reg. (June 2,
2014).
The Promise and Danger of Data Analytics in Sentencing and Corrections Policy
Eleven years ago, Michael Lewis released Moneyball} a book describing how Billy
Beane, the general manager of Major League Baseball's Oakland Athletics, used what was then
considered massive amounts of statistical data to predict the future performance of baseball
players. Beane built a winning ballclub by collecting promising players identified by his
statistical models who had been passed over by other teams. These players then went on to
overachieve at a startling rate. Beane succeeded by replacing the traditional method of
evaluating baseball talent being used by most Major League clubs with something new. In the
traditional method, older experienced baseball men "scouted" players - watching the players
MI CHAEL LEWIS, MONEYBALL: THE ART OF WI NNI NG AN UNFAI R GAME (2003). Other commentators have also
seen the value of Moneyball as a particularly illustrative example of how data analytics can outperform human
decision making in all sorts of endeavors. See, e.g., Kate May, infra note 2. These include scholars and
practitioners who have made the connection between Moneyball and criminal justice. See, e.g., S. Sidhu,
Moneyball Sentencing, (July 8, 2014), available at SSRN: or
Anne Milgram, infra note 7.
The Honorable B. Saris
2
perform and using their accumulated wisdom and judgment to identify those players who, they
believed, would succeed into the future. These scouts were indeed the qualitative experts of
baseball at the time. But Beane saw the value in analyzing past performance data in a more
sophisticated and rigorous way to dramatically improve the building of a baseball team by more
accurately predicting the future performance of players than scouts ever could. Finding value
through data, Beane built a winning team at a low cost.
Since the publishing of Lewis' book, there has been an explosion in the use of data
analytics to identify patterns of human behavior and experience and bring new insights to fields
of nearly every kind.
2
The story of analytics in industry after industry often follows the pattern
found in Moneyball? The qualitative experts in a field - the wise men and women with years of
experience - are outdone by a statistical researcher with little field knowledge, and even less
experience, but with a tremendous understanding of modern data analysis. The researcher knows
what the wise men and women have a tough time grasping: that an algorithm working on a
problem thousands of times faster than traditional methods can bring new understanding of a
correlation or sometimes even a specific cause and effect. Scientists have known for some time
now that when sufficient information can be collected and quantified, statistical analysis wi l l
outperform an individual almost every time. The growth in computing power, storage capacity
and statistical and computational methods has brought this reality to new areas of human
experience at a growing pace. We have seen the linking of diverse datasets, the deployment of
sophisticated analytics and algorithms, and the advancement in knowledge of human behavior
applied to everything from marketing to medicine; genomics to agriculture; banking to
matchmaking.
4
In criminal justice, the use of analytics is not new, of course. CompStat, the New York
City Police Department's management tool - now replicated and deployed in many other police
departments across the country - has, for example, been used for decades to allocate police
resources efficiently by mapping where crime has occurred and predicting where and when
crimes are most likely to occur in the future.
5
The analytics of policing are evolving steadily and
Predictive Policing - the use of algorithms that combine historical and up-to-the-minute crime
information to do the work of hundreds of traditional crime analysts and produce real-time
targeted patrol areas - is spreading.
6
Judges are also beginning to adopt risk assessment tools
Kate Torgovnick May, The Moneyball Effect: How Smart Data is Transforming Criminal Justice, Healthcare,
Music, even Government Spending, TED: IDEAS WORTH SPREADING (Jan. 28, 2014, 12:26 PM),

See Lewis, supra note
See Torgovnick May, supra note 2.
See BUREAU OF JUSTICE ASSISTANCE, U. S. DEP' T OF JUSTICE & POLICE EXECUTIVE RESEARCH FORUM, COMPSTAT:
ITS ORIGINS, EVOLUTION, AND FUTURE I N LAW ENFORCEMENT AGENCIES available at

See, e.g., Gordon Tokumatsu, LAPD Rolls Out "Predictive Policing" to Prevent Crime, NBC Los ANGELES, (Feb.
2014, 10:39 PM), http://www.nbclosangeles.com/news/local/LAPD-Rolls-Out-Predictive-Policing-Prevent-
see also, F. Cody, Predictive Policing - Law New Cyber Tool, LAW
ENFORCEMENT TODAY (Jan. 15, 2012), http://www.lawenforcementtoday.com/2012/01/15/predictive-policing-
%E2%80%93-law-enforcements-new-cyber-tool/.
Page 3
based on data analytics in pretrial hearings. Recently, former New Jersey Attorney General Anne
Milgram - who first connected Moneyball and criminal justice - together with the Arnold
Foundation, developed a "comprehensive, universal risk assessment" tool that is already being
used by judges at pretrial hearings in every county in Kentucky.
7
Similarly, predictive analysis has been part of sentencing and corrections in the United
States for many decades. The rehabilitative model of sentencing and corrections, which was at
the heart of the creation of the modern penitentiary and which dominated sentencing and
corrections policy in the U.S. until the late 20
t h
Century, was fundamentally based on predicting
future behavior.
After a sentencing judge had imposed a prison term, which sometimes would be
set in a range as broad as one year to life, prison and parole officials were
expected and instructed to consistently review offenders' behavior in prison to
determine i f and when they should be released to the community.
8
The work of these prison and parole officials - and the goal of the rehabilitative model -
was to predict when the offender's return to the community would be safe for all.
Through the the determination of when an offender would be released from prison
to the community looked a lot like a team of baseball scouts predicting the future performance of
a prospect. It was human analysis: the gathering of bits of data and running them through
individual human experience and wisdom to make the assessment - for the release decision by a
parole board just as for picking a first baseman by a scout team. Psychological theory and
research this kind of human analysis and decision making and revealed findings
that are now, with new and better data analytics, becoming even clearer. First, this kind of
complex human decision making is often based on errors, biases and heuristics. Second,
decision makers have little insight into their own decision-making processes. And third,
statistical models are more accurate and more consistent, and thus fairer, than statistical
human decision making.
9
This understanding of human decision making and its limitations compared to actuarial
and statistical modeling first led the U.S. Parole Commission to issue guidelines for its release
decisions and thus begin transforming the parole function to take advantage of statistical
modeling. That Commission created the Salient Factor Score, based on such modeling, to help
determine what the Commission called "the parole prognosis," the likelihood of a parole
Milgram, Why Smart Statistics are the Key to Fighting Crime, TED: IDEAS WORTH SPREADING (Oct.
crime; Leila Walsh, Laura
and John Arnold Foundation Develops National Model for Pretrial Risk Assessments, LAURA AND JOHN ARNOLD
FOUNDATION (NOV. 14, 2013) ,

Douglas A. Re-Balancing Fitness, Fairness, and Finality for Sentences, 4 Wake Forest J. L. &
159 ( 2014) .
See DANI EL KAHNEMAN, THINKING, FAST AND SLOW R. Barry Ruback and Jonathan J. Wroblewski, The
Federal Sentencing Guidelines: Psychological and Policy Reasons for Simplification, 7 Psych. Pub. Pol. And L. 739
( 2001) .
Page 4
violation of one kind or another by an offender being considered for release. The Parole
Commission understood the superiority of the actuarial model in future behavior and
the evenhandedness that come with using such a model as compared to human decision
Subsequent research has shown the Salient Factor Score - and later the Sentencing
Commission's own Criminal History Score - to be reliable predictors of post-imprisonment
misconduct.
10

The sentencing reform movement of the and 80s replaced the rehabilitative model
of sentencing that had been in place from the earliest days of the with a new sentencing
framework based on truth-in-sentencing and the idea that a criminal sentence should largely be
based on the crime committed. The foundation of the new system was the belief that reducing
reoffending was not a task worth pursuing - that nothing worked to change offending behavior -
and that excessive discretion in charging, sentencing and parole decisions had led to unwarranted
disparities and discriminatory impacts on the poor and people of color. It was thought that
certainty in sentencing - certainty in the imposition of a particular sentence for a particular
crime, and certainty in the time to be served for a sentence imposed - would simultaneously
improve public safety by deterring new criminality, and also increase fairness in sentencing by
reducing unwarranted sentencing disparities. This new determinate system of sentencing did not
depend largely on predicting future behavior, for sentences were based primarily on the
offender's past criminal conduct.
The sentencing reform movement not only brought with it a new framework for
sentencing but also led, as we and many others have documented, to an extraordinary increase in
the use of incarceration. The Attorney General has written and spoken regularly about the
increase in the Nation's prison population over the last three decades and why, in particular, it is
imperative that we control federal prison spending. The Commission's recent vote to reset
guideline offense levels for drug trafficking offenses is an important step to meeting that
imperative. We continue to work with Congress and the Commission to find ways to adequately
control the federal prison population while simultaneously ensuring public safety.
We have also previously noted how the increase in the prison population led to an
explosion in the number of people returning to the community each year from stints in

General Janet Reno and then-National Institute of Justice Director Jeremy Travis
recognized this phenomenon in the late and much has been done to focus on effectively
preparing offenders to return to the community. Various efforts to reduce reoffending have
E.g., Peter B. Hoffman, Twenty Years of Operational Use of a Risk Prediction Instrument: The United States'
Parole Salient Factor Score, 22 J. C R M. JUST. 477 (1994); see also U. S. SENTENCING COMM' N, A
COMPARISON OF THE FEDERAL SENTENCING GUIDELINES CRMI NAL HISTORY CATEGORY AND THE U. S. PAROLE
COMMISSION SALIENT FACTOR SCORE available at
vism_Salient_Factor_Computation.pdf.
Annual Report from Jonathan Wroblewski, Director, Office of Policy and Legislation, Criminal Division,
Department of Justice, to Patti B. Saris, Chair, U. S. Sentencing (July 2013) (on file with Dept. of
Justice, available at
The Honorable Patti B. Saris
Page 5
yielded promising results, and legislators, prosecutors, courts, and probation offices around the
country are focusing more and more on effective prisoner reentry.
This new focus on reentry has brought with it a renewed need to identify those offenders
most at risk for reoffending upon to the community and to identify the individual needs
of those offenders that i f effectively addressed could reduce the risk of reoffending. In the
federal system, this has taken form, for example, in the Judiciary's implementation of "evidence-
based practices" and the deployment of the Post-Conviction Risk Assessment Instrument
(PCRA). The PCRA uses information from an offender's past to identify both the risk of
reoffending and the needs to be addressed to lessen that risk.
12
Risk and needs assessment
instruments like the PCRA are a step in bringing data and the scientific method to corrections.
We think there is much to be celebrated about this step.
Moreover, research and experience are showing increasingly that the notion from the
that nothing works to reduce reoffending is simply incorrect. Effective prisoner reentry is
eminently possible. However, for many offenders, especially those who enter the criminal
justice system with social deficits, limited skills and little family support, reentry is very difficult
work. Despite the progress seen in prisoner reentry programs in recent years, recidivism
research continues to show unacceptably high rates of reoffending among released offenders.
13
Clearly, there is far more to be done, and we believe the Commission has an important role in
supporting research and development work around reentry programs.
In particular, we believe the Commission should support research and development
around the use of data analytics in reentry programs. We believe such use has the potential to
dramatically improve performance of reentry programs and to transform the work of probation
and community supervision. It holds the long term potential to revolutionize community
corrections to make it far more effective than it is today and also a far more palatable alternative
to incarceration in certain cases.
The deployment of analytics and other information technology in furtherance of reentry
can improve risk and needs assessments, but also has the potential to do far more. For example,
we believe that properly deployed, analytics and information technology more generally can
provide early warnings when an offender is straying from her reentry plan. They can enable
faster responses from probation officers to get an offender back on track. They can provide more
effective delivery of needed services, the real-time awareness to let probation officers know
what's happening on the ground moment by moment, and real-time feedback comparing what's
happening relative to what was intended. Effective service delivery combined with swift, certain
and fair responses to misconduct - the keys to successful corrections - can be greatly facilitated
by these technologies and analytics.
OFFICE PROB. AND PRETRIAL SERV.S, ADMI N. OFFICE OF U.S. COURTS, A N OVERVIEW OF THE FEDERAL
POST CONVICTION RI SK ASSESSMENT available at

PEW CTR. ON THE STATES, STATE OF RECIDIVISM: THE REVOLVING DOOR OF AMERI CA' S PRISONS (Apr.
available

Page 6
We think the role, effectiveness and efficiency of community corrections and individual
probation officers could be dramatically with the use of technologies and
analytical tools and that recidivism rates can be brought down on the same scale that violent
crime has been reduced over the last two decades. Linking diverse datasets, deploying analytics,
and applying advances in knowledge of human behavior, we believe, wi l l all be part of that
reengineering. As former New Jersey Attorney General Anne Milgram stated, "The returns for
better applying technology in criminal justice extend far beyond reducing crime or costs, to
something that government officials are sworn to uphold: justice."
14
The research and
development around this potential transformation is something the Sentencing Commission is in
a unique position to accomplish, and we think it is something the Commission should have on its
agenda.

While we are excited about the promise of using analytics in risk and needs assessments
and otherwise in furtherance of effective reentry, we are troubled by another use of these tools in
sentencing and corrections: the increasing role of risk assessment tools in the sentencing phase of
criminal cases, specifically in determining how long an individual wi l l be imprisoned for a
criminal conviction. As we noted, risk assessments - through the Salient Factor Score - had a
prominent place in the federal parole system in place prior to the Sentencing Reform Act and
were a determinant of the amount of time a federal offender served in federal prison for an
offense. The Sentencing Reform Act was enacted to reduce the role of such assessments and to
base imprisonment terms largely, but not entirely, on the crime committed and proven in court.
In recent years, states are increasingly adding risk assessments to the criminal sentencing
process. Pennsylvania
15
and Tennessee,
16
for example, have enacted legislation mandating the
use of risk assessments to inform sentencing decisions. Vermont
17
and Kentucky
18
use sex
offense recidivism risk instruments in sentencing defendants convicted of sex crimes. For many
years now, Virginia has mandated the use of an actuarial risk tool to identify low-risk offenders
for diversion from prison for certain criminal convictions and high-risk sex offenders for an
increased sentencing range.
19
The Model Penal Code is i n the process of being revised to
include actuarial risk tools in the sentencing process. The revisions would direct sentencing
commissions to -
Develop actuarial instruments or processes, supported by current and ongoing
recidivism research, that wi l l estimate the relative risk that individual offenders
pose to public safety through their future criminal conduct. When these
supra note 7.
42 Pa. Consol. Stat. Ann. (2009).
Code Ann. 41-l-412(b) (2013).
28 V.S.A. 204a(b)(l) (2013).
KRS 17.554(2) (2013).
Jordan M. Hyatt et Reform in Motion: The Promise and Perils of Incorporating Risk Assessments and Cost-
Benefit Analysis into Pennsylvania Sentencing, 49 DUQ. L. REV. 707, 723
Page 7
instruments or processes prove sufficiently reliable, the commission may
incorporate them into the sentencing guidelines.
20
In the federal system, legislation pending in both the House and Senate would make risk
assessment once again a major determinant of imprisonment terms served by federal offenders.
21
The legislation would regulate the portion of an imposed term of imprisonment ordered by a
court that would actually be served by a federal offender. While the goals of improving reentry
programming and efficacy are laudable and while there is much we support in the legislation, we
are concerned by these key provisions that would base imprisonment periods to be served on the
results of a yet-to-be-created risk assessment instrument that wi l l evolve over time as data
analytics develop and make their way into such instruments. We think these provisions - and the
larger emerging trends around risk assessments and sentencing - raise many concerns the
Commission ought to study and address.
First, most current risk assessments - and in particular the PCRA, which is specifically
mentioned in the pending federal legislation - determine risk levels based on static, historical
offender characteristics such as education level, employment history, family circumstances and
demographic information. We think basing criminal sentences, and particularly imprisonment
terms, primarily on such data - rather than the crime committed and surrounding circumstances -
is a dangerous concept that wi l l become much more concerning over time as other far reaching
sociological and personal information unrelated to the crimes at issue are incorporated into risk
tools. This phenomenon ultimately raises constitutional questions because of the use of group-
based characteristics and suspect classifications in the analytics. Criminal accountability should
be primarily about prior bad acts proven by the government before a court of law and not some
future bad behavior predicted to occur by a risk assessment instrument.
Second, experience and analysis of current risk assessment tools demonstrate that
utilizing such tools for determining prison sentences to be served wi l l have a disparate and
adverse impact on offenders from poor communities already struggling with many social ills.
The touchstone of our justice system is equal justice, and we think sentences based excessively
on risk assessment instruments wi l l likely undermine this principle.
Third, use of risk assessments to determine sentences erodes certainty in sentencing, thus
diminishing the deterrent value of a strong, consistent sentencing system that is seen by the
community as fair and tough. Our brothers and sisters in the defense and research communities
have repeatedly cited research to the Commission about the value and efficacy of certainty of
apprehension and certainty of punishment in deterring crime. Swift, certain and fair sanctions
are what work to deter crime, both individually and across society. We know that certainty in
sentencing - certainty in the imposition of a particular sentence for a particular crime, and
certainty in the time to be served for a sentence imposed - simultaneously improves public safety
and reduces unwarranted sentencing disparities. We are concerned that excessive reliance on
Model Penal Code: Sentencing 6B.09(2) (Tentative Draft No. 3, 2014).
Recidivism Reduction and Public Safety Act, S.1675, Cong. (2014); Public Safety Enhancement Act,
H.R.2656, Cong. (2013).
Page 8
risk tools wi l l greatly undermine what has been achieved around certainty of sentencing in the
federal system.
Determining imprisonment terms should be primarily about accountability for past
criminal behavior. While any effective sentencing and corrections policy wi l l take account of
future behavior to some extent - incapacitating those more likely to recidivate and utilizing
effective reentry efforts to reduce the likelihood of recidivism - we believe the length of
imprisonment terms should mostly be about accounting for past conduct. As analytics
evolve, we are concerned about the implications of sentencing policy moving away from this
precept.
We think the Sentencing Commission's agenda should include the study of risk
assessment tools and their various uses in the sentencing and corrections/reentry processes.
Following such study, the Commission should issue a statement of policy about the proper role
of these instruments in the federal criminal justice system in particular. As analytical tools
transform risk assessment instruments, there is great potential for their use, but also great
dangers. With the Commission's help, the good can be harnessed, the dangers avoided, and like
Bi l l y Beane, we can achieve success - here, increased public safety and greater justice - at far
lower costs to all.
Structural Sentencing Reform
Several years ago, we noted that federal sentencing practice was fragmenting into at least
two distinct sets of sentencing outcomes. On the one hand, sentencing outcomes in many courts
remain closely tied to the sentencing guidelines. These courts have continued to impose
sentences within the applicable guideline range for most offenders and most offenses.
22
On the other hand, many courts that while still influenced by the sentencing guidelines
deviate regularly and significantly from them.
23
These courts regularly impose sentences outside
the applicable guideline range irrespective of the offense type or the nature of the offender.
24
In
addition, there are certain offense types for which the guidelines have lost the respect of a large
number of judges across districts. The most obvious of these offense types is child pornography
crimes.
We remain concerned by this evolution of federal sentencing into two separate practices.
Most importantly, the research and data make increasingly clear that this divide leads to
unwarranted sentencing disparities. More and more, studies are showing that a defendant's
sentence wi l l be significantly influenced by the judicial assignment of the case and the particular
See U. S. SENTENCING COMM' N, SOURCEBOOK OF FEDERAL SENTENCING STATISTICS, Table 26 (2013) available at

See id.
See id. at Table 27 available at http://www.ussc.gov/sites/default/files/pdf/research-and-publications/annual-

9
court that conducts the sentencing. This is quite troubling. In our consideration of federal
sentencing policy, we begin from the principle that offenders who commit similar offenses and
have comparable criminal histories should be sentenced similarly. This was the foundational
principle of the Sentencing Reform Act of It seems that our federal sentencing system
may be meeting this principle less and less.
We continue to believe the Commission should study these diverging practices and, over
the long run, consider structural reform of the federal sentencing guidelines to address them. In
addition to increasing disparities, the current guidelines structure spurs much needless litigation.
This is not surprising, given that the guidelines structure was developed for a different legal
framework, when the guideline calculation was intended to be the last word for most cases.
To this end, much can be learned from state sentencing guideline systems. There has
been significant research of state guideline systems.
26
As we have stated before, these systems,
by and large, differ structurally from the federal sentencing guidelines in that they have simpler
sentencing grids, fewer grid cells, and less complex guideline formulas - i.e. fewer aggravating
and mitigating factors embodied in rules for litigators to fight over. Conventional thinking
would suggest that a greater numbers of cells with more factors embodied in rules would create a
greater number of sets of similarly situated offenders and result in a greater degree of sentencing
consistency and meaningful differentiation among offenders. However, the available research
and experience suggest that greater detail in the sentencing grid and sentencing formulas does
not better sort offenders into more meaningful categories for purposes of sentencing decisions

In particular, our experience with the very detailed federal guidelines, when applied through the
legal framework created by Booker, has seen quite disparate guideline application and sentencing
outcomes. These findings should guide the Commission in its work evaluating unwarranted
disparities as much as data on guideline compliance by federal judges. Moreover, we think these
findings - along with many other factors - should guide the Commission to consider structural
guidelines reform to produce a simpler guideline system.
We continue to believe that a strong and consistent federal sentencing system is
important to improving public safety across the country - as it has over the past decades - and to
furthering greater justice for all in a cost effective manner. And we further believe that much can
be learned from the states, including how a simpler form of sentencing guidelines improve
consistency, reduce unwarranted sentencing disparities, and better allocate sentencing decisions
among the stakeholders in the criminal justice system.
Transactional Records Access Clearinghouse, Surprising Variations Documented in Federal
Sentencing, TRACREPORTS (March 5, 2012) ,
E.g., Richard S. Frase, State Sentencing Guidelines: Diversity, Consensus, and Unresolved Policy Issues, 105
COLUM. L . REV. ( 2005) .
Wroblewski, supra note
See, e.g., BRI AN J. OSTROM, ET AL. , NAT ' L CTR. FOR STATE COURTS, ASSESSING CONSISTENCY AND FAIRNESS I N
SENTENCING: A COMPARATIVE STUDY I N THREE STATES ( 2008) .
Page 10
A strong and effective federal sentencing system is critical to keeping national crime
rates low, moving them still lower, improving justice, and addressing specific and acute crime
problems.
Other Priorities
While simultaneously considering systemic reforms, we think the Commission can and
must consider evolving and problematic crime-specific, application and reentry issues under the
current sentencing guidelines
A. Congressional Enactments
One Commission priority for the coming amendment year must be to respond to
directives and other enactments from Congress. The Commission is a product of Congress and
exercises authority delegated by Congress. Thus, its first priority should be to respond to
congressional action. During the amendment year, the Commission should complete work on
any congressional pending directives addressing particular guideline areas as well as any other
congressional enactments involving criminal law. Below, we note an enactment from the
Commission has not yet addressed, and an enactment from 2002 that the Commission did not
address completely.
1. The Small Business Jobs Act of Contract Fraud Related to the Small Business
Administration, and Credits Against Loss
The Commission should amend the guidelines, consistent with the Small Business Jobs
29
Act of (Act), so offenders who fraudulently obtain federal contracts under small business
preference programs serve at least some minimal time in prison. The applicable guideline,
(Theft, Property Destruction, and Fraud), currently directs an insufficient sentencing
outcome, steering courts to focus only on the net pecuniary loss involved, which is an inadequate
measure of culpability and harm in this context.
Section measures harm in procurement fraud cases in relation to pecuniary loss.
But a recurring theme in the Commission's Symposium on Economic Crime
30
was that loss
is an inadequate measure of culpability in some fraud cases. For this unique crime type, where
offenders obtain government contracts by fraudulently certifying they are part of a minority
owned firm, there is often no pecuniary loss to any identified victim. There may be no direct
impact on the quality of the goods or services provided to the government from these
fraudulently obtained contracts. Application note (Credits Against Loss) provides that
"Loss shall be reduced by . . . the fair market value of the property returned and the services
Pub. L. No. 124 Stat. 2504 (2010).
30
U.S Sentencing Comm. 'n Symposium on Economic Crimes, (2013), available at http://www.ussc.gov/research-

economic-crime.
Page
rendered, by the to the victim before the offense was Thus,
application of in these cases wi l l often result in no loss or in a loss amount that includes
only re-procurement costs. As a result, a guideline sentence in cases where small business
contractors make material false statements to the government regarding their compliance with
Federal requirements such as contract eligibility, but where the government suffers no financial
loss because it obtains the contracted-for goods or services, wi l l rarely include even a short
prison term. We believe this is insufficient to serve the purposes of punishment.
We also think the current guideline application for these cases is at odds with U.S.C.
632, which was amended by the Act. Section 632 now provides a presumption that the loss to
the United States is to be based on the total amount expended on the contract whenever a small
business concern receives a government contract by misrepresentation.
32
The credits against
loss provision of as applied to these cases is inconsistent with the revised statute.
One of the purposes of the Act is to ensure that some government contracts are awarded
to small businesses and businesses owned by minorities and disadvantaged persons. When
bidders' obtain contracts by falsely certifying their status, the harm done is to qualifying
competitors who were cheated, to the integrity of the Small Business Administration, and to the
wi l l of Congress. Allowing fraudsters like these to go virtually unpunished fails the sentencing
goals of just punishment as well as deterring this type of fraud and fraud in government
contracting more generally.
This type of fraudulent conduct directly undercuts the government's policy of providing
benefits to small firms owned by minorities or disadvantaged persons. Legitimate small business
contractors are prevented from obtaining program benefits, and fraudsters benefit from illegal
acts, encouraging public contempt for federal programs and for the law generally.
We believe the Commission should take up this issue this amendment year and should
amend the guidelines so they recommend that these offenders serve at least some minimal time
in prison.
2. Hidden Offshore Bank Accounts and Matching the Statutory Enhancement in
U.S.C. to (Money Laundering And Monetary Transaction
Reporting)
The Commission should also amend the sentencing enhancement at so that
it is consistent with the similar statutory enhancement enacted in 2002,
33
by expressly providing
that the sentencing enhancement applies i f the defendant committed a Title offense "while
violating another law of the United States or as part of a pattern of unlawful activity involving
more than $100,000 in a 12-month period." Although 2S1.3(b)(2) was added in 2002 in
response to statutory amendments providing for enhanced criminal penalty provisions under
See USSG 2B n. (3)(E) (Credits Against Loss).
15 U.S.C. 632(w)(l) (2012).
Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism
Act (USA PATRIOT ACT), Pub. L. No. 107-56, 371(c), Stat. 337 (2002).
Page
U.S.C. 5322(b), the sentencing enhancement omits the statutory language "while violating
another law of the United States."
A top priority for the Department's Tax Division is combating violations of U.S. tax laws
using secret offshore bank accounts. Increased technical sophistication of financial instruments
and the widespread use of the Internet have made it increasingly easy to move money around the
world. According to reports, the use of secret offshore accounts to evade U.S. tax laws costs the
Treasury at least $100 billion annually.
35
The linchpin of the Department's Offshore Compliance
Initiative is 5314 (records and reports on foreign financial agency transactions), which
obligates U.S. citizens and resident aliens to report financial accounts in a foreign country with
an aggregate value of more than

The Tax Division charges violations of 5314 under 5322 (criminal penalties), which
provides for an increased maximum penalty of a $500,000 and years imprisonment for
willfully committing the reporting violation "while violating another law of the United States or
as part of a pattern of any illegal activity involving more than in a period."
37
Unfortunately, as explained below, the guidelines in their current form impede the application of
this statutory sentencing enhancement to all of the circumstances intended by Congress.
In a typical offshore tax evasion case, a defendant earns income from an offshore account
and willfully conceals the existence of the account from the government in order to avoid paying
taxes on the income. This conduct violates both the tax laws and Title which governs
monetary transactions. Under the guidelines, sentences for tax crimes are governed by Part T of
Chapter Two, under which the offense level is generally determined by intended tax loss. In
contrast, sentences for violations of 31 U.S.C. and 5322 are governed by where
the offense level is generally determined by the value of the funds that went unreported.
provides a base offense level for a violation of of 6 plus the number of offense
levels from the table in Significantly, however, 1.3(b)(3) provides that the offense
level is reset back to 6 i f no sentencing enhancement applies. The triggering of the reset
provision wi l l almost always result in a lower offense level under than under Part T - the
tax guidelines which reach offense level 8 with only $2,000 in tax loss.
39
I f the funds in the undisclosed foreign bank account were amassed legally and are used
for a lawful purpose, the government's ability to avoid the reset to offense level 6 is largely
limited to proving that the enhancement under applies; i.e., that the defendant
"committed the [Title offense as part of a pattern of unlawful activity involving more than
$100,000 in a 12-month period." Although it is the Department's position that a defendant's
failure to pay tax on the income generated by unreported funds i n an unreported foreign account
See USSG App. C, vol. I I , amend. 637, supp. at 244 ( 2002) .
See e.g., Staff Rep. S. Perm. on Investigations, Cong., HAVEN BANKS AND U.S.
COMPLIANCE, at 1 (July 17, 2008).
3 1 U.S.C. 5314( 2012) .
3 1 U.S.C. 5322(b) ( 2012) .
USSG
USSG 2T4. 1( B) .
Page
satisfies the "pattern of activity" requirement - because the conduct would violate both
the tax laws and the offshore-account reporting requirement - adding the phrase "while violating
another law of the United States" to 1.3(b)(2) would remove any ambiguity on that point,
thus fulfilling the provision's purpose of "giv[ing] effect to the enhanced penalty provisions
under31 U.S.C. 5322(b)."
40
We the Commission to amend 1.3(b)(2) this way this
amendment year.
B. The "Categorical Approach"
As the Commission well knows, one of the most vexing application issues in federal
sentencing is determining whether certain prior convictions trigger higher statutory and guideline
sentences. We have repeatedly encouraged the Commission to review the terms "crime of
violence," "violent felony," "aggravated felony," and "drug trafficking offense" as they are used
in federal sentencing statutes and guidelines, and the use of the "categorical approach" to
determine whether prior convictions trigger higher statutory and guideline sentences.
Few statutory and guideline sentencing issues lead to as much litigation as determining
whether a prior offense is categorically a "crime of violence," "violent felony," "aggravated
felony," or "drug trafficking offense." Although the Supreme Court has employed the murky
"categorical approach" to define these terms as they appear in statutes,
41
because of the advisory
nature of the guidelines, we believe the Commission is free to simplify the determination within
the guidelines manual. The Commission is also well positioned to advise Congress on how to do
the same federal statutes.
The examples of problems caused by the doctrine are countless, and we think this issue
should concern the Commission because the categorical approach has led the courts to very
inconsistent sentencing results.
42
We do not believe defendants should receive dramatically
different sentences simply because of varying practices in charging and record-keeping among
the 50 states and thousands of counties and parishes throughout the United States or because of
varying drafting conventions among state legislatures. Moreover, Congress, the Commission
and the Administration have all made clear that for many crime types, significant imprisonment
terms should be reserved for those who are violent, aggravated or repeat offenders. The inability
to efficiently and effectively define prior aggravated convictions thwarts this sensible strategy.
We are hopeful the Commission's work wi l l result in a resolution of this problem that wi l l
ultimately reduce the resources needed to litigate these cases and increase sentencing
consistency.
C. Child Exploitation Crimes
The Department shares the Commission's view that child pornography offenses are
serious crimes that have a profound impact on victims and their families. We also agree with the
USSG App. C, vol. I I , amend. 637, at 244 (2002).
See Taylor v. United States, 495 U.S. 575 (1990); Shepard v. United States, 544 U.S. 13 (2005); and Chambers v.
United States, 555 U.S. 122 (2009).
We have noted these inconsistent results for the Commission in the past.
Page 14
Commission that technological advancements have changed the way offenders obtain and
distribute child pornography, so much so that the specific offense characteristics in the current
guidelines no longer reliably capture the seriousness of offender conduct, nor fully account for
differing degrees of offenders' dangerousness. The Department has repeatedly called for reform
of the sentencing guidelines for non-production child pornography crimes, but has stated that
such reform must keep the threat offenders pose to children fiont and center.
Specifically, the Department is hoping to work with the Commission to obtain
congressional authority to amend 2G2.2 of the guidelines. As we have detailed before,
43
we
believe 2G2.2 (under the current guideline structure) should be amended in a number of ways.
For example, we believe an enhancement should be added to account for offenders who, through
online communication with others, encourage the sexual abuse or exploitation of a minor, solicit
the production of child pornography, or facilitate measures to avoid detection. We also
recommend an enhancement for offenders who engage in repeated and long term child
pornography trafficking and collecting. The guideline should also account for the sophistication
of the offender's behavior, particularly with respect to measures taken to avoid detection or
prosecution, such as using mechanisms designed to mask an offender's identity
online, and encryption, which greatly impedes investigators' ability to gain access to evidence
necessary to procure a conviction. These actions demonstrate a level of sophistication and
commitment to offending that should play a role in enhancing an offender's sentence.
After undertaking a multi-year examination of sentencing in child pornography cases, the
Commission concluded . . the existing sentencing scheme in non-production cases no
longer adequately distinguishes among offenders based on their degrees of culpability."
44
As a
consequence, the child pornography guideline is currently being followed in only about a third of
child pornography cases.
45
We urge the Commission to continue its work in this area to resolve
this situation as soon as possible.
D. Review of Supervised Release Violators
We support the Commission's review of recidivism and reoffending. We reiterate our
hope that the review wi l l focus in significant part on the circumstances under which offenders
who violate their terms of supervised release have those terms of supervision revoked so that
they are returned to federal prison. As we have indicated in the past,
46
innovative work - like the
HOPE Program - happening across the country and involving probation and supervision
violators, suggests there may be opportunities for public safety improvements and cost savings
regarding this group of offenders in the federal system.
Wroblewski, supra note
U. S. SENTENCING COMM' N, REPORT TO THE CONGRESS: FEDERAL CHI LD PORNOGRAPHY OFFENSES, at i-xxvi, i i
available
(2012).
U. S. SENTENCING COMM' N, supra note 22, at Table 27.
Wroblewski, supra note at 12.
Page
E. Native American Advisory Group
We previously sent a letter to the Commission requesting that it form a new American
Indian Sentencing Advisory Group to study the treatment of American Indian defendants and
victims in federal criminal courts. In light of the unique federal in Indian Country
and the expanded focus of federal law enforcement on crimes committed there, we believe such
an advisory group is critical to further developing trust and confidence i n the federal sentencing
system and the federal criminal justice system more broadly. An advisory group could make use
of various data sources and the Commission's research capacity to identify concerns with federal
sentencing in Indian Country and recommend solutions as warranted. We urge the Commission
to form such a group this year.
F. Burrage and Causation
The Controlled Substances Act provides for a 20-year mandatory minimum sentence
when a defendant unlawfully distributes a covered substance and "death or serious bodily injury
results from the use of such substance."
47
The guidelines similarly provide an enhanced penalty,
in (Unlawful Manufacturing, Importing, Exporting, Trafficking, Or Possession;
Continuing Criminal Enterprise), when the "the offense of conviction establishes that death or

serious bodily injury resulted from the use of the substance."
In Burrage v. United States, the Supreme Court interpreted the phrase "results from" in
the Controlled Substances Act to require but-for causation between the use of the drug
distributed by the defendant and the resulting death or serious bodily injury, where the use of the
drug is not an independently sufficient cause of the death or injury.
49
According to Commission
data, 83 defendants were sentenced under 1.1 (a)(2), where the offense established that death
or serious bodily injury resulted from the use of the substance, during fiscal year 2012.
50
We
believe in most circumstances, when a drug trafficker sells a controlled substance that is a
contributing - but not a but-for - factor in the end user's death or serious bodily injury (perhaps
because, as i n the case of Burrage, the user had consumed other drugs that also contributed to the
death), the trafficker should still receive some enhanced penalty to account for the death or
injury.
To address this issue, the Commission should amend the guidelines to provide additional
guidance to courts in sentencing drug offenders who sold drugs involved in the death or serious
bodily injury of users both to conform the guidelines with Burrage and to ensure appropriate
penalties for the serious harm caused by these offenses. This should include an invited upward
departure provision to account for the death or serious bodily injury caused when a controlled
See, e.g., 2 1 U. S. C. 841(b)(1)(C) ( 2012) .
US S G (a)(2), which triggers a base offense level of 38 ( 235- 293 months at Criminal History Category I ) ,
consistent with the statutory minimum.
Burrage v. United States, 134 S. Ct. 8 8 1 , 892 ( 2014) .
See U. S. SENTENCING COMM' N, FISCAL YEAR 2 0 1 2 DATAFILE, available at
publications/commission-datafiles ( 2012) .
Page 16
substance that is a contributing - but not a but-for - factor in the end user's death or serious
bodily injury.
G. Definition of "Controlled Substance Offense"
In 2008, the Commission amended the guidelines to clarify that the term "drug trafficking
offense" includes "offers to sell" illegal drugs.
51
There has also been litigation over the term
"controlled substance offenses" and whether it also includes offers to sell.
52
We believe a
similar amendment should now be made to make clear that the term "controlled substance
offense" as used in the guidelines includes offers to sell. An amendment clarifying the term in a
manner consistent with the 2008 amendment would be appropriate.
H. Definition of "Criminal Justice Sentence"
Pursuant to a defendant receives two criminal history points i f he commits
"the instant offense while under any criminal justice sentence, including probation, parole,
supervised release, imprisonment, work release or escape status." The introductory commentary
to 4A1.1 explains the rationale for the adjustment: "Repeated criminal behavior is an indicator
of a limited likelihood of successful rehabilitation" and that a defendant's "likelihood . .
future criminal behavior" must be considered.
However, the applicability of the adjustment for offenders who commit the instant
offense while already serving a sentence is limited to sentences countable under 4A1.2. In
2007, the Commission amended 4A1.2 to exclude certain misdemeanor offenses from the
criminal history score.
53
Defendants no longer receive the two criminal history points under
1.1(d) i f the instant offense was committed while under a term of probation of exactly one
year for misdemeanor convictions for reckless driving, contempt of court, disorderly conduct,
disturbing the peace, driving without a license or with a revoked or suspended license, giving
false information to a police officer, gambling, hindering or failing to obey a police officer,
writing a bad check, leaving the scene of an accident, failure to pay child support, prostitution,
resisting arrest and trespassing.
54
In many cases - including violent crime, firearms and narcotics cases - defendants are
serving a term of probation at the time of the federal offense for one of the offenses listed in
As the Commission itself has recognized, this fact evidences an increased
likelihood of recidivism. Nonetheless, under the current guideline, the two-point increase does
not apply.
USSG App. C, Amendment 709 (Nov. 1, 2007).
See, e.g., United States v. Savage, 542 F.3d 959 (2d Cir. 2008) (vacating and remanding a federal sentence
because the previous conviction under a Connecticut statute that criminalized offers to sell illegal drugs was not
necessarily a "controlled substance offense" under the guidelines); United States v. Price, F.3d 285, 288 (5th
Cir. 2008) (vacating and remanding a federal sentence because Texas controlled substance offense included a
broader range of offenses, including offers to sell, unlike "controlled substance offense" as defined i n the
guidelines).
USSG App. C, Amendment 709 (Nov. 1, 2007).
See USSG
Page 17
We believe that anytime a defendant commits a federal offense while serving a period of
state parole or probation, that defendant should receive two additional criminal history points to
reflect an increased risk of recidivism. We think the Commission should review this issue and
consider amending Chapter Four accordingly.
I . Hidden Offshore Bank Accounts Involved in Tax Crimes
In addition to the tax issue discussed above concerning hidden offshore bank accounts
and 1.3(b)(2) (Money Laundering And Monetary Transaction Reporting), the Commission
should also review a separate issue involving hidden foreign bank accounts and (Income
Taxes, Employment Taxes, Estate Taxes, Gift Taxes, And Excise Taxes). By law, U.S.
taxpayers are required to report worldwide income from all sources, including income from
55
offshore accounts. Similarly, the law requires a U:S. taxpayer to report to the U.S. Treasury
Department his or her foreign accounts with balances in excess of $10,000 as to which he or she
has certain ownership interests and/or control.
56
The use of bank or investment accounts
maintained in a tax haven with strict bank secrecy laws is often done less for customary
investment purposes (due to low rates of return and high fees) than because it increases the
difficulty of U.S. law enforcement agencies to discover the accounts and enforce U.S. laws.
Our national tax enforcement program is enhanced when wrongdoers are appropriately
sentenced and those who would contemplate engaging in similar conduct are deterred.
Conversely, the program is impaired and tax revenue is correspondingly lost when offshore cases
that are criminally prosecuted result in sentences that do not deter continued evasion. We
believe in many cases involving offshore accounts, the tax loss wi l l significantly understate the
seriousness of the tax offense (as a result of low rates of return and high fees charged in
exchange for the secrecy procured).
We propose that the Commission amend the commentary in to recognize that an
upward departure may be warranted where the tax loss, the customary proxy for harm in tax-
related cases, substantially understates the seriousness of the offense. A provision patterned after
Application Note in would best accomplish this and be most consistent with the
current guideline structure. We propose a new Application Note 8 to 2T1.1 as follows:
8. Upward Departure There may be cases in which the offense level
determined under this guideline substantially understates the seriousness of the offense.
In such cases, an upward departure may be warranted.
For example, a defendant who willfully fails to disclose an offshore bank account may
have unreported income from the account that is relatively small in comparison with the
value of the assets hidden, as a result of low rates of return and high fees charged in
exchange for the secrecy procured. In such a case, the tax loss table in 2T4.1 may
Foreign Account Tax Compliance Act; Pub. L. No. 124 Stat. 97 (codified as amended in scattered
sections of 26 U.S.C).
C.F.R. 1010.340(2010).
Page
produce an offense level that substantially understates the seriousness of the offense. I f
so, an upward departure may be warranted.
J. Economic Crimes
We are pleased the Commission wi l l be continuing its review of sentencing policy for
economic crimes and in particular the application of fraud guideline, over the coming
amendment year. While we believe the current guideline recommends appropriate sentences in
most cases, we recognize that certain amendments to may be needed. The Commission's
Symposium on Economic Crime
57
helped to identify discrete and important issues that we
believe ought to be addressed this year. We look forward to working with the Commission on
these issues in the coming months.
K. Evasion of Export Controls
We recommend the Commission amend 2M5.1 (Evasion of Export Controls) in order to
conform the guideline to the structure of the export control regime administered pursuant to the
International Economic Powers Act as well as to address problems created
by the inflexibility of the current guideline applicable in IEEPA prosecutions.
The applicable guideline should reflect the range of conduct governed by IEEPA. The
Commerce Control List (CCL) administered by the Department of Commerce regulates a range
of munitions and dual use items of varying levels of sensitivity, the unlawful export of which
may constitute a criminal violation of IEEPA. The CCL regulates many items that are highly
sensitive, including items that can be used in nuclear weapons, and controls exports based on
important national security and foreign policy interests associated with the sensitivity of the
items or the destination countries or end users. The controls also apply to less sensitive items,
end uses, and end users. These controls have undergone significant reform under the President's
Export Reform Initiative to ensure that the controls are calibrated to the national security and
foreign policy interests at stake. In addition, the Departments of State and Treasury also
administer controls under the authority of IEEPA, criminal violations of which are captured by
this guideline.
The current 2M5.1 does not take full account of this regulatory regime. The current
guideline imposes a base offense level of 26 in nearly all cases. A base offense level of 14 is
available in very limited instances (when national security controls or countries supporting
international terrorism are not involved). For the most sensitive controls, a base offense level of
26 does not capture the seriousness of the conduct. At the same time, the fact that the guideline
does not account for the broad range of controls in the CCL has led to a widespread practice of
district courts departing or varying from the guidelines. The courts have imposed disparate
sentences that undermine the strong policy interest in uniform sentencing, often sentencing
defendants at levels that reflect unwarranted departures from the base offense level of 26. This
Comm'n Symposium on Economic Crimes, (2013) available at

economic-crime.
Page 19
practice weakens the credibility of the guideline in a range of potential cases, frustrating the
government's ability to rely on the guideline to lead to an adequate sentence.
A revised guideline could address these problems by providing a greater range of
sentencing levels to better capture the range of export control violations to which the guideline
applies. Rather than two base offense levels in the current guideline, we propose three possible
base offense levels, with the addition of three specific offense characteristics for three types of
aggravating factors. We propose a base offense level of 25 i f controls relating to the
proliferation of nuclear, biological, or chemical weapons or materials were evaded; a base
offense level of 22 i f other national security controls were evaded, or i f the offense involved a
financial transaction with a country supporting international terrorism; and a base offense level
of 14 in cases where none of these factors applied.
We further suggest three specific offense characteristics: a three level increase i f the
relevant item, technology or services relates to a WMD program, a weapon, or a military, missile
or nuclear end use or end user; a three-level increase i f the commodity, technology,
software, or service was intended for or facilitated or received by (A) a country, foreign entity or
person that is sanctioned or otherwise designated by the Departments of Treasury, State, or
Commerce for national security or foreign policy reasons; or (B) a country subject to a U.S. arms
embargo; and a three-level increase i f the transaction involves more than An
application note should specify in addition that i f the base offense level of 25 applied for controls
relating to nuclear, biological, or chemical weapons or materials, then the specific offense
characteristic relating to WMD programs, weapons, or military, missile or nuclear end use or end
users would not apply.
The resulting adjusted offense levels for the most serious offenses would be higher than
under the current guideline, but the graduated offense level structure would also allow for a
lower offense level in cases without the aggravating factors. We believe that a guideline revised
in this manner would provide judges with more useful advice and generally promote greater
consistency in sentencing.
The addition of a base offense level and the specific offense characteristics would further
provide flexibility to allow tailored sentences for defendants who participate in a criminal
network. Section 2M5.1 is most frequently for IEEPA Iranian sanctions offenses and
"dual-use" items to China offenses, and some of these networks may be relatively complex,
involving actors of differing culpability.
We are continuing to evaluate whether a similar approach is justified as to 2M5.2
(Exportation of Arms, Munitions, or Military Equipment or Services Without Required
Validated Export License), but the export controls subject to 2M5.2 are significantly different
from the controls administered under the CCL. The sensitivity of items on the International
Traffic in Arms Regulations violations of which implicate 2M5.2, tend to be more
uniform. As part of the Export Reform Initiative, less sensitive items on the ITAR are being
moved to the CCL. For these reasons, 2M5.2 does not present the same need for the proposed
calibrated structure (and restructuring) we are proposing for 2M5.1.
Page 20
Circuit Conflicts and Other Court Decisions
We continue to urge the Commission to make the resolution of circuit conflicts a priority
for this guideline amendment year, pursuant to its responsibility outlined in Braxton v. United
We also urge the Commission to clarify the guidelines in light of issues identified by
the appellate courts in case law.
A. Section and Recordkeeping Offenses to Conceal Substantive Environmental Offenses
The Commission should resolve a circuit split concerning the application of
(Mishandling of Hazardous or Toxic Substances or Pesticides; Recordkeeping, Tampering, and
Falsification; Unlawfully Transporting Hazardous Materials i n Commerce) when the defendant
has engaged in a recordkeeping offense that conceals a substantive environmental offense.
Section applies to prosecutions brought pursuant to a host of environmental
criminal statutory provisions.
59
When the violation is a "recordkeeping offense," 1.2(b)(5)
provides, " [ i ] f a recordkeeping offense reflected an effort to conceal a substantive environmental
offense, use the offense level for the substantive offense."
60
Nevertheless, there is a split among the circuit courts of appeals on how to apply
The Tenth Circuit (and a district court in the Seventh Circuit) has held that the
enhancements i n - (4) apply to recordkeeping violations regardless of the motive
for the violation.
61
In contrast, the Sixth and Second Circuits have held that when the motive is
at least in part other than to conceal an environmental violation, those enhancements do not
62
apply. In other words, i f a defendant's motive to falsify records or not disclose information as
required is motivated by some other factor, such as to save money, to save time, or simple
laziness, the enhancements do not apply in the Sixth and Second Circuits even i f the result of the
500 U.S. 344, 347-49 (1991).
These include, among others, the Clean Water Act, the Resource Conservation and Recovery Act, and the Clean
Ai r Act. Section is applicable to charges brought pursuant to the same provisions, but generally applies to
violations involving other, less hazardous substances. It has a base offense level of 6.
Application Note 1 further defines a "recordkeeping offense" to include ". . . recordkeeping and reporting
offenses. The term is to be broadly construed as including failure to report discharges, releases, or emissions where
required; the giving of false information; failure to other required reports or provide necessary information; and
failure to prepare, maintain, or provide records as prescribed." The Background explains: "The first four specific
offense characteristics [2Q1.2(b)(l)-(4)] provide enhancements the offense involved a substantive violation.
The fifth and sixth specific offense characteristics apply to recordkeeping offenses." In defining
the term broadly, the Sentencing Commission recognized that in the environmental context, recordkeeping
violations can have significant repercussions that should be punished consistent with substantive environmental
violations that have the same consequences.
See United States v. Morris, 85 Fed. App' x (10th Cir. 2003); United States v. 525 F.Supp.2d 1058
(S.D. 2007), aff d on other grounds, 555 F.3d 553 (7th Cir. 2009).
See United States v. White, 270 F.3d 356, 369 (6th Cir. 2001); United States v. Canal Barge Co., Inc., et
F.3d 347 (6th Cir. (involving a failure to report a benzene leak on a vessel as required by the Ports and
Waterways Safety Act, 33 U.S.C. 1232(b)(1) (2006), motivated by a desire to delay of vessel's voyage due
to unsafe condition); United States v. 40 F.3d 544, 552 (2d Cir. 1994).
Page
violation is a discharge into the environment, a death, an evacuation, or a disposal without a
permit.
At odds with the interpretations of the Sixth and Second Circuits is the recent Supreme
Court decision in Loughrin v. United States.
63
In Loughrin, the Court held that for bank fraud
U.S.C. 1344), the government is not required to prove that the defendant intended to
defraud a financial institution, as there is no such requirement the statute's text.
64
Rather, the
government must show merely that a defendant obtained money (or funds, or property, etc.)
under the custody or control of a financial institution by means of false or fraudulent pretenses,
representations or promises.
65
Requiring more would prevent the statute from applying to cases
falling within the clear terms of the statute's language, in the case of bank fraud, third party
custodians of bank owned property.
66
Similarly, in there is no requirement that the judge must rule out an
additional motivation, besides the effort to conceal a substantive environmental offense. More
generally, the nation's environment is a precious resource that deserves protection, and we think
this interpretation of the guidelines impedes the full protection intended by the Commission and
the law. We believe the Commission should resolve this conflict by clarifying that the Tenth
Circuit's interpretation is correct as a matter of law and of policy.
B. Prior Convictions for Statutory Rape and Sexual Abuse of a Minor
The Commission should also resolve a circuit split concerning the application of a 16-
adjustment under (Unlawfully Entering or Remaining in the United States) for prior
crimes of statutory rape and sexual abuse of minor. The enhancement is triggered by a
prior felony crime of violence conviction.
67
Application Note l(B)(iii) defines "crime of
violence" to include statutory rape and sexual abuse of a minor.
68
Circuits differ, though, as to
whether statutory rape and sexual abuse of a minor require the victim to be under or under
The Supreme Court has not taken up this issue, denying many petitions for certiorari entreating
the Court to resolve this circuit split and leaving the issue to the Commission.
69
The Ninth Circuit, relying on the fact that thirty-two states, the federal government, and
the District of Columbia have all set the age of consent at has held that the age of consent for
No. 2014 U.S. LEXIS 4306 (U.S. June 23, 2014).
Id.
Id.
Id.
2L1.2(b)(l)(A)(ii).
USSG 2L1.2 comment.
See, e.g., Perez-Mejia v. United States, No. 13-9150 (June 16, 2014); v. United States, No. 13-
5808 (Feb. 24, 2014); Rodriguez v. United States, No. 12-10695 (Nov. 4, 2013); see also, e.g.,
v. United States, No. 12-10954 (Nov. 4, 2013); Anaya-Santiago v. United States, 12-8034 (Feb. 19, 2013); Vera-
v. United States, No. (Jan. 9, 2012); v. United States, No. 10-9053 (June 20,
Castaneda-Alfaro v. United States, No. 10-8562 Martinez v. United States, No. 10-8558 (May
2011).
Page 22
the purposes of the "generic, contemporary meaning" of statutory in 2L1.2 is The
Fourth Circuit has likewise held that the generic definitions of the offense of statutory rape and
sexual of a minor require the victim to be younger than In contrast, the Fifth Circuit,
relying on Webster's Dictionary and Black's Law Dictionary, has held that the generic meaning
of "minor" in sexual abuse of a minor is a person under and that the age of consent for
statutory rape is defined by local statute.
a result, in the Ninth and Fourth Circuits, a defendant's previous conviction under a
state statute where the age of consent is seventeen or eighteen or that defines a child as a person
under seventeen or eighteen (as at least seventeen states do) would not qualify as a prior crime of
violence, whereas i n the Fifth Circuit such convictions would qualify.
73
A related issue is whether both statutory rape and sexual abuse of a minor require an age
differential between the perpetrator and the victim. An element of sexual abuse of a minor,
under U.S.C. 2243 (sexual abuse of a minor or ward), is that the victim be at least four years
younger than the perpetrator. However, this is not the case in all relevant state statutes.
To our knowledge, only the Ninth Circuit has directly addressed the issue. Relying in
on the definition found in federal law at 2243, the Ninth Circuit has held that the generic
definition of sexual abuse of a minor includes an age difference of at least four years.
74
The
Ninth Circuit similarly found a four-year age differential in the generic definition of statutory
rape.
75
In contrast, the Fifth Circuit did not mention a requirement of an age differential when
holding that the age of consent for statutory rape is that defined by the state statute.
76
We believe the Commission should resolve all of these issues related to in the
coming amendment year.
United States v. Rodriguez-Guzman, 506 F.3d 738 (9th Cir. 2007).
United States v. Rangel-Castaneda, 709 F.3d 373, 378 (4th Cir. 2013).
United States v. Rodriguez, F.3d 541, 561 (5th Cir. 2013) denied, 134 S. 512 (2013) ("We reject the
Ninth Circuit's reliance on this definition of 'age of consent' because the Black's Law Dictionary definition of
'statutory rape' states explicitly that the age of consent in the specific context of statutory rape is to be defined by
statute.").
Muddying the waters further, a dissenting judge in the Eighth Circuit questioned whether the majority view is
truly representative, given that seventeen states are excluded, including the most populous state California. See
United States v. Viezcas-Soto, 562 F.3d 903, 914 (8th Cir. 2009) (Gruender, J., dissenting) ("It seems to me that a
definition of 'statutory rape' that excludes the statutory rape laws of seventeen states, including the most populous
state in the Union [California], along with Texas [age of consent New York Florida and Illinois
cannot reasonably be classified as
Estrada-Espinoza v. Mukasey, 546 F.3d (9th Cir. 2008); United States v. Gomez, 2014 U.S. App.
LEXIS 7810, 47 (9th Cir. Wash. Apr. 24, 2014) ("[W] e defined the generic offense of "sexual abuse of a minor" as
requiring "four elements: (1) a mens rea level of knowingly; (2) a sexual act; (3) with a minor between the ages of
12 and 16; and (4) an age difference of at least four years between the defendant and the minor.").
Gomez, at ("The development of our law in this area, as well as the statutory law of other jurisdictions,
leads us to conclude that a four-year age difference is an element of the generic offense of statutory rape.") ; see
United States v. 738 F.3d 1051, 1057 (9th Cir. 2013).
United States v. Rodriguez, F.3d 541 (5th Cir. 2013) {en banc).
Page 23
C. King, Williams, and The Effect of Grouping on Career Offender Predicates
The Commission should resolve an emerging circuit split concerning the effect of
consolidated state convictions on whether or not a crime qualifies as a career offender predicate.
In King v. United States}
1
the Eighth Circuit held that the "concurrent sentence provision" of
(Definitions and Instructions for Computing Criminal History) is ambiguous. It
found that the provision is subject to two plausible interpretations, and under the rule of lenity,
the defendant is entitled to the more favorable interpretation. Under King's construction of
a conviction that would qualify as a career offender predicate on its own ceases to
qualify i f the defendant was simultaneously convicted of another non-predicate offense for which
he received a longer concurrent sentence. Thus, in the Eighth Circuit, a prior conviction for
armed robbery alone is a predicate felony for career offender purposes, but i f the prior conviction
for armed robbery is consolidated with a non-predicate offense, for example, drug possession, it
would cease to be a predicate felony for career offender purposes i f the sentences for the two
crimes were ordered to run concurrently and the sentence for the drug possession count was
longer.
In United States v. Williams, the Sixth Circuit, fully aware of the Eighth Circuit's view,
ruled the opposite way: that the concurrent sentence provision of is not ambiguous,
because it says nothing about the scoring of multiple crimes within a single predicate episode.
78
Therefore each of Williams's previous convictions, including his conviction for fourth-degree fleeing
and eluding, independently supported the assessment of criminal history points under 4Al.l(a), (b),
and (c) and thus the fleeing and eluding conviction would count as a career offender predicate.
79
We believe the Commission did not intend an otherwise applicable predicate conviction
to be excluded from the career offender calculus by the conviction of an additional crime, and we
therefore ask the Commission to clarify the relevant guideline language.
D. Conditions of Supervised Release
o n
In United States v. Siegel, the Seventh Circuit, in an opinion by Judge Posner, held that
several conditions of supervised release were invalid on vagueness grounds. One of the
invalidated conditions - to refrain from excessive alcohol use - is found at of the
guidelines and is among a number listed in the guidelines as recommended standard conditions
1
of supervised release. In subsequent cases, the Seventh Circuit has rejected various imposed
conditions of supervised release based on the sentencing court's failure to explain the need
the conditions.
82
595 F.3d 844 Cir. 2010).
No. (6th Cir. June 2,
Id.
2014 WL 2210762 (7
t h
Cir. May 29, 2014).
See also, 18 U.S.C. 3563(b)(7).
See, e.g., United States v. Benhoff, 13-2369, 2014 WL 2724650 (7th Cir. 2014); United States v. Baker, 13-1641,
2014 WL 2736016 (7th Cir. 2014); United States v. Farmer, 13-3373, 2014 WL 2808079 (7th Cir. 2014); United
States v. Johnson, 12-3229, 2014 WL 2854996 (7th Cir. 2014).
Page 24
We believe the Commission can and should remedy any vagueness problem in
either by amending the guidelines to more specifically address the circumstances
that would constitute excessive alcohol use or in the alternative by directing sentencing courts to
specify such circumstances. Further, we think the Commission should consider amending the
commentary in Chapter Five more generally to direct sentencing courts, in imposing conditions
of supervised release, to specifically address the need for the conditions.
Miscellaneous Issues
A. Antitrust Offenses
The Commission has indicated it plans "a study of antitrust offenses, including
examination of the fine provisions in The American Antitrust Institute has
previously requested that the Commission re-examine 2Rl . l ' s percent overcharge
presumption and at least double this presumption due to its belief that it significantly understates
the gain from cartel activity.
83
We believe the current fine provisions, which provide for a base fine of 20
percent of an organizational defendant's volume of affected commerce, are The
Commission determined that volume of commerce "is an acceptable and more readily
measurable substitute" for damages caused or profit made by a defendant, because antitrust
"damages are difficult and time consuming to establish."
85
The Commission also established the
20 percent proxy for the economic impact of, or loss from, an antitrust offense, based on the
estimated average gain of 10 percent and the recognition that loss from an antitrust offense
exceeds gain, in order "to avoid the time and expense . . . required for the court to determine the
actual gain or loss."
86
The Commission directed that "[i ]n cases in which the actual . . .
overcharge appears to be either substantially more or substantially less than percent, this
factor should be considered in setting the fine within the guideline fine range."
87
Based on current evidence, the Department believes the typical cartel does increase prices
more than percent, but the actual average overcharge is subject to debate. Very recent
literature concludes that the accumulated evidence points to a lower average overcharge than the
AAI presumes, although still greater than 10 percent.
88
We do not believe it would be a
Letter to the U.S. Sentencing Commission from The American Antitrust Institute, (July 8, 2013), available at

USSG 8C2.4(b).
USSG 2R1.1,
USSG 2R1.1, (n.3).
Id.
Marie-Laure Allain, Marcel Boyer & Jean-Pierre Ponssard, The Determination of Optimal Fines in Cartel Cases:
Theory and Practice, 4 CONCURRENCES 32, Marcel Boyer & Rachidi How Much Do Cartels
Overcharge? (Toulouse School of Economics, Working Paper TSE-462, 2014).
Page 25
worthwhile expenditure of resources to put any process i n motion to increase the percent
presumption marginally. The current guidelines already provide a mechanism to increase fines
by imposing fines higher in the guidelines range. By sentencing a defendant at or near the top of
a defendant's guidelines range, a court can impose a sentence that accounts for overcharges well
in excess of the 20 percent figure proposed by the AAI . Thus, even i f the Commission were to
adopt the proposal, it would have only a marginal impact on our ability to adequately
deter, detect and punish cartel offenses.
Any reconsideration of the guidelines' approach to antitrust fines should also not lose
sight of the general deterrence rationale of the antitrust guideline. The purpose of antitrust fines
and j ai l sentences and the antitrust guideline is to deter antitrust offenses through a predictable,
uniform methodology. Closely tying antitrust penalties to a defendant's attributable volume of
commerce necessarily promotes the twin goals of certainty of punishment and proportionality of
punishment. The deterrence rationale for penalties means that proper sentences are only loosely
related to the actual harm from offences. The level of the penalty necessary to deter relates to
the expected gain from offending at the time the decision whether to offend is made.
We would be happy to address any additional issues of interest to the Commission
regarding antitrust fines.
B. Cyberstalking, Violence and Extortion by Proxy, Hacking of Personal Social Media and
Extortion, and the Statutory Index for Convictions Under U.S.C. 1030
We believe the guidelines' statutory index should be amended so that convictions under
18 U.S.C. (Fraud and Related Activity in Connection with Computers) are considered
under the guideline for stalking, in addition to the guideline for theft and fraud,
We believe the fraud guideline is inappropriate and inadequate when the offense behavior
involves cyberstalking and related conduct. As the digital age continues to evolve, so have
online threats. These threats are variously described as cyberstalking, violence and extortion by
proxy, hacking of personal social media, "sextortion," and "revenge pornography." In a recent
case, for example, perpetrators hacked into a victim's email, Facebook, and other social media
accounts, found compromising pictures and videos, then used these files to extort nude and
otherwise compromising pictures and videos of the victim and to gain access to the accounts of
others, and do the same thing to them.
89
In United States v. Kazaryan, No. ( CD. Feb. 25, 2013), the defendant hacked into hundreds of
victims' email, Facebook and Skype accounts. He then methodically searched these accounts for nude pictures of
the victim, passwords, and contact information of the victim's friends. Once he had access to an account, he would
take over the account and pretend to be that person to her friends. He would persuade the friends to show him
sexually explicit pictures of themselves and to provide other information that he then used to obtain access to their
accounts. He would then return to original victims in the guise of another victim's account, extorting additional
sexually explicit pictures and videos. I f the victims hesitated at all, he posted previously obtained pictures publicly,
causing the victims to receive calls from other friends about how their entire friend network could now see them
naked. There were victims. Those targeted most seriously characterized the experience as devastating, akin to
rape, with the harm ongoing.
Page 26
Unless interstate communications are demonstrably involved, such defendants are usually
charged with computer hacking under 18 1030. Unfortunately, the applicable guideline
under Appendix A, (Theft, Embezzlement, Receipt of Stolen Property, Property
Destruction, and Offenses Involving Fraud or Deceit), is not designed to address this kind of
cyberstalking and related conduct. Although Application Note 20(A)(ii) contemplates an upward
departure where the offense "caused or risked substantial non-monetary harm," sentences usually
fail to reflect the tremendous harm done to the victims. We ask that the Commission to review
these cases and consider amending the Appendix A so that convictions under 18 U.S.C.
are also referenced to the guideline for stalking,
The policy agenda we suggest here is substantial. The range of issues represents the
range of the Commission's statutory responsibilities, including overseeing the systemic health of
the federal sentencing system and its structural elements, addressing individual guidelines in
need of reform, resolving circuit conflicts, and more. We look forward to discussing all these
issues with you and the other Commissioners with the goal of refining the sentencing guidelines
and laying out a path for developing effective, efficient, fair, and stable sentencing policy long
into the future.
Under the leadership of the Attorney General, violent crime rates continue to fall and are
now at generational lows. Our goal is to continue to improve public safety while ensuring justice
for all by means of the efficient use of enforcement, judicial and correctional resources. We
appreciate the opportunity to provide the Commission with our views, comments, and
suggestions.
Conclusion
Sincerely,
cc: Commissioners
Kenneth P. Cohen, Staff Director
Kathleen Cooper Grilli, General Counsel

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