When the U.S. Sentencing Commission speaks or writes, criminal practitioners and federal judges listen. An independent agency of the judicial branch created by Congress in the 1980s, it is composed of seven voting members, at least three of whom are federal judges. The U.S. Attorney General, or her designee, and the Chair of the U.S. Parole Commission, also serve as nonvoting members.[1] The Sentencing Commission is the entity that issues the Guidelines Manual.
What is the Guidelines Manual?
The Guidelines Manual is a foundational document for all federal sentences – whether for economic crimes like healthcare, bank, securities and tax fraud, or for trafficking and status crimes like distribution of controlled substances, illegal re-entry, and possession of a firearm by a prohibited person. In short, the Guidelines Manual is what criminal defense attorneys, prosecutors, probation officers, and sentencing judges use to calculate a defendant’s low- and high-end number of months of imprisonment or the “sentencing guidelines range.”
How is the Sentencing Guidelines Range Determined?
The Guidelines Manual computes a sentencing guidelines range using a grid containing two axes – offense level and criminal history.
- First, the Guidelines Manual assigns each federal crime a base offense level and provides a series of specific offense characteristics which can increase the base offense level.
- Then, an additional chapter provides for victim, role, and obstruction-related adjustments, resulting in a final offense level calculation.
- A defendant’s criminal history is then calculated using rules for assessing or excluding points for convictions which land each defendant in one of six categories.
- These two calculations – offense level and criminal history category – come together on the sentencing table to produce the sentencing guidelines range.
Definition of “Amount of Loss”
For many economic crimes, the starting point for calculating offense level is §2B1.1 of the Guidelines Manual, which addresses theft, embezzlement, and fraud offenses. Amount of loss is a specific offense characteristic within §2B1.1 which can add between 2 and 30 levels to a defendant’s offense level calculation. Not surprisingly, amount of loss is typically a primary factor determining a white-collar defendant’s sentencing range.
This begs the question – should “amount of loss” be the actual loss to a victim, or the amount of loss intended by the defendant?
For years, the Sentencing Commission’s guidance, contained in the “commentary” portion of §2B1.1, dictated that “amount of loss” is the greater of actual or intended loss. Over the years, most courts applied that loss definition. Then, in 2022, the United States Court of Appeals for the Third Circuit issued a decision defining loss as the loss the victim actually suffered (actual loss).[2] In response, in 2024 the Sentencing Commission moved its more expansive loss definition from commentary directly into §2B1.1.[3]
Will the Sentencing Commission shift focus from amount of loss to culpability factors?
In August of 2025, the Sentencing Commission issued a “Notice of Proposed 2025-2026 Priorities.”[4] One such priority is “reassessing the role of actual loss, intended loss, and gain.” Other priorities include considering an adjustment to simplify the amount of loss table or adjust it for inflation, assessing the impact of a defendant’s aggravating or mitigating role in an offense, and weighing the impact of the adjustment for who and how many were victimized.[5]
A practical read of these recent signals from the Sentencing Commission is that it may move to decrease emphasis on amount of loss and increase the focus on culpability factors like role (leader or minor participant), level of planning and sophistication, the abuse of a trust enhancement, and the type and quantity of victims. A big year is ahead. Any shift in focus should be top of mind for practitioners defending financial fraud and economic crime cases.
Chris Dippel and Alexandra Rossi Roland are members of Kean Miller’s White-Collar Investigations & Criminal Defense group, which defends and navigates clients through a wide range of matters involving criminal allegations of financial and securities fraud, health fraud, theft of government funds, embezzlement, public corruption, and other forms of white-collar crime.
[1] https://www.ussc.gov/about/who-we-are/organization.
[2] United States v. Banks, 55 F.4th 246, 255-58 (3d Cir. 2022).
[3] https://guidelines.ussc.gov/apex/r/ussc_apex/guidelinesapp/guidelines?app_gl_id=%C2%A72B1.1.
[4] https://www.ussc.gov/policymaking/federal-register-notices/federal-register-notice-proposed-2025-2026-priorities.
[5] https://www.ussc.gov/sites/default/files/pdf/training/primers/Primer_Victims.pdf.