Sentencing Commission Addresses Inconsistent Definitions of “Loss"

November 20, 2024  |  New York Law Journal

In fraud cases, the Sentencing Guidelines are heavily dependent on the amount of loss caused by a defendant’s conduct.  Circuit Courts of Appeals have been divided over whether the term “loss” includes the loss that a defendant intended to inflict, or the actual loss suffered by the victim. At the root of the Circuit split is a dispute over how much deference should be afforded commentary contained in the Guidelines.  Prior to an amendment that went into effect earlier this month, the relevant commentary had defined loss in non-tax cases to include "intended loss." Although the Guidelines now explicitly include “pecuniary harm that the defendant purposely sought to inflict,” the different approaches applied by courts is an important reminder to tax practitioners that the commentary is not entitled to ironclad deference. In his latest article for the NYLJ, Sentencing Commission Addresses Inconsistent Definitions of “Loss,” Morvillo Abramowitz Grand Iason & Anello partner Jeremy H. Temkin examines the Circuit split over the scope of "loss" under the Sentencing Guidelines, highlights key cases discussing deference due to Guidelines commentary, and discusses how similar arguments can be applied to tax cases.

Sentencing Commission Addresses Inconsistent Definitions of “Loss" (pdf | 129.20 KB)