Sentences Should Be Reasonable, Not Shocking: A De-Emphasis on Loss for Federal Securities Fraud Sentencing

This Note considers the role of loss in determining appropriate sentences in criminal securities fraud cases. This Note begins with an analysis of the history of loss in federal economic crime sentencing and the changes brought by the U.S. Sentencing Guidelines. This background informs a discussion of the different approaches that courts have taken in calculating criminal securities fraud sentences—namely, either adopting or rejecting the principles governing damages in civil cases. Additionally, this Note considers the increased use of discretion by district courts, as allowed by the decision in United States v. Booker, to determine that sentences based primarily on loss are unreasonable. The author concludes that the use of loss in sentencing would create a bright-line rule for courts to follow, achieving the U.S. Sentencing Guidelines’ goal of uniformity; this uniformity, however, would come at the expense of proportionality and fairness. To resolve this conflict, the author suggests that courts follow civil principles for determining loss but exercise Booker discretion in cases where following these principles would be unjust or produce disproportionate sentences.

The full text of this Note is available to download as a PDF.