Saturday, July 17, 2010

Wesley Snipes Conviction and Sentence Affirmed (7/17/10)

As the world (including likely readers of this blog) know, Wesley Snipes was convicted of 3 counts (years) of failure to file (while being acquitted of more serious offenses). The district court gave him a sentence of 3 years, which is the maximum because the counts of conviction were misdemeanors having a maximum one year sentence and, by stacking them (serving consecutively), he could be sentenced to a maximum sentence of 3 years. Mr. Snipes did not appreciate that. He appealed. The Eleventh Circuit has affirmed here.

The whole case is worthy of reading. I make only a few points of matters that struck me on a quick read.

1. The Court has a good analysis of the importance of venue and why it is an essential element that the Government must prove at trial. One interesting point is that, although it is an essential element of the proof, it is not an element of the crime. Hence, the Government must prove venue only by a preponderance of the evidence.

2. Although all practicing in this area already knew this, use of offshore accounts (the current hot topic) can result in a sentencing enhancement under the Sentencing Guidelines for sophisticated means. (Unless to do so would "double count," although double counting is not addressed in the case.)

3. The Court rejected Snipes' claim that Section 2T1.1 of the Guidelines is invalid because it did not treat a misdemeanor crime (failure to file, of which Snipes was convicted) as a less serious offense than a felony. Those practicing in this know that the key to calculating the Base Offense Level for misdemeanors is the same table that is used for felonies. The benefit of misdemeanor convictions is that the maximum incarceration period will be capped substantially less than felony convictions. Thus, in Snipes' case, his failure to file misdemeanor convictions capped his sentence at 3 years, but had he been convicted of 3 felonies which in the tax arena, have 3 year and 5 year sentences per count of conviction, his maximum sentence (which he would have drawn for reasons noted below) would have been 9 years and 15 years, respectively. But, where the final Offense Level, driven principally by the tax loss, indicates a sentencing range equal to or less than the maximum on the misdemeanor counts of conviction, there is no difference in sentencing if the counts of conviction had been for felonies rather than misdemeanors. This seems odd to me, for in defining the crime and the maximum sentence, Congress seems to have said that a tax misdemeanor is only 1/3 or 1/5 as bad as a tax felony, and yet convictions for tax misdemeanors can in the circumstances noted draw the same sentence as convictions for tax felonies. Again, this is under the Guidelines, and because the Guidelines are no longer mandatory, a sentencing court can take that difference into consideration if it chooses to do so.

4. The sentencing court here did not take that difference into account, apparently. The sentencing court noted that "The district court noted that misdemeanants who, like Snipes, had willfully failed to file their personal income tax returns had engaged in similar behavior to the felons who had received similar sentences." Moreover, it relied upon the exemplary effect of a stiff sentence for Snipes. The court of appeals said:

The district court gave ample consideration to each of the relevant considerations found in 3553(a). Although the discussion about general deterrence was somewhat longer than the discussion of the other factors, its length corresponds with the emphasis the Sentencing Guidelines placed on deterrence in the criminal tax context. The introductory commentary to the Tax section of the Sentencing Guidelines explains that

[b]ecause of the limited number of criminal tax prosecutions relative to the estimated incidence of such violations, deterring others from violating the tax laws is a primary consideration underlying these guidelines. Recognition that the sentence for a criminal tax case will be commensurate with the gravity of the offense should act as a deterrent to would-be violators.
U.S.S.G. Ch. 2 Pt. T, intro. Comment (emphasis added).
5. So, what was the indicated Guidelines sentence? I haven't calculated it exactly, because the intended tax loss as calculated by the PSI was over $40,000,000 which with enhancements for sophisticated means and obstruction of justice would easily produce a Guidelines range well exceeding the maximum 3 year sentence for 3 misdemeanor counts. Hence, the Judge, with the considerations noted, handily imposed the maximum sentence, and the Court of Appeals sustained it without much ado.

1 comment:

  1. excellent breakdown!! thanx u just solved an argument on this case in my house. :)


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