American University Law Review
October, 1999
COMMENT
Airing the Dirty Laundry:
The Application of the United States Sentencing Guidelines to White
Collar Money Laundering Offenses
Jonathan H. Hecht*
INTRODUCTION
The passage of the Sentencing Reform Act of 1984 (SRA) virtually stripped federal trial court judges of all discretion in the sentencing of convicted criminals. Prior to the SRA, trial judges exercised broad discretion with respect to the severity of punishment handed down to convicted criminals. In the eyes of many, including Congress, the broad discretion exercised by federal judges allowed for unjustifi[ed] and shameful results. For example, offenders often were given vastly different sentences based on similar criminal conduct. In response to significant outrage, Congress enacted the SRA. The SRA established the United States Sentencing Commission (Commission) with the following mandate: to formulate a framework or guideline for sentencing based upon accepted principles of punishment and to eradicate the apparent discrepancies in the imposition of sentences in the federal criminal justice system. Ultimately, the Commission formulated a system of sentencing called the United States Sentencing Guidelines (Guidelines).
Under the Guidelines, trial judges possess limited discretion in sentencing. To determine appropriate sentences under the Guidelines, judges must insert numbers predetermined by the Commission based on the factual circumstances surrounding the criminal offense into the Commissions sentencing formulas. Beyond this formulaic process, judges may deviate from the Guidelines parameters only in limited circumstances.
The Commission intended for deviations from the Guidelines to be rare occurrences. For the crime of money laundering, however, deviations or departures are significantly more prevalent than in all other federal crimes. According to the Commission, the average downward departure rate for non-drug, or white collar, money laundering offenses from 1992 to 1997 was thirty-two percent higher than the overall departure rate for all other crimes.
The Commission claims that this increased rate of departure has resulted from trial judges considering a mitigating factor that is not adequately taken into consideration in the Guidelines in order to determine a more just sentence. Nevertheless, this increased rate of downward departure has not diminished, but rather increased sentencing disparities. Depending on the particular judge or circuit, defendants convicted for white collar money laundering offenses often are given vastly different sentences for similar criminal conduct. To fulfill the mandate of the Commission and realize the goals of the Guidelines, the money laundering provisions of the Guidelines need to be reexamined.
This Comment discusses several problems and the surrounding discourse associated with the money laundering Guidelines. This discussion will demonstrate that the federal courts inconsistent use of downward departures in white collar offenses has increased sentencing disparity, thereby contradicting the stated goals of the Commission. Part I of this Comment reviews the legislative intent of both the money laundering statutes and the SRA. In addition, Part I discusses the law governing downward departures. Part II analyzes the shortcomings of the present money laundering Guidelines. In addition, Part II examines the existing debate between the Commission and Department of Justice regarding whether Congress should amend the Guidelines. Furthermore, Part II examines the federal courts response to this debate and the resulting sentencing disparities. Part III recommends how the Commission, Department of Justice, Congress, and the courts should respond to these apparent problems with the existing Guidelines. Finally, this Comment concludes that to fulfill the mandate of the Commission and the legislative intent of both the money laundering statutes and the SRA, either significant amendments to the present Guidelines are required or appellate courts must consider an additional issue when reviewing whether a sentence is correct.
* Editor-in-Chief, American University Law Review, Volume 49; J.D. Candidate, May 2000, American University, Washington College of Law; B.A., 1997, Pennsylvania State University. The author would like to thank Professor Sheldon Krantz for his assistance on this project.
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