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The United States Sentencing Commissionis an independent agency in the judicialbranch of government. Its principalpurposes are: (1) to establish sentencingpolicies and practices for the federal courts,including guidelines prescribing theappropriate form and severity of punishmentfor offenders convicted of federal crimes;(2) to advise and assist Congress and theexecutive branch in the development ofeffective and efficient crime policy; and (3) tocollect, analyze, research, and distribute abroad array of information on federal crimeand sentencing issues, serving as aninformation resource for Congress, theexecutive branch, the courts, criminal justicepractitioners, the academic community, andthe public.
The U.S. Sentencing Commission wascreated by the Sentencing Reform Actprovisions of the Comprehensive CrimeControl Act of 1984. Unlike many specialpurpose “study” commissions within theexecutive branch, Congress established theU.S. Sentencing Commission as an ongoing,independent agency within the judicialbranch. The seven voting members on theCommission are appointed by the President,confirmed by the Senate, and serve six-yearterms. No more than three of thecommissioners may be federal judges, and nomore than four may belong to the samepolitical party. The Attorney General is an exofficio member of the Commission, as is theChairman of the U.S. Parole Commission.
The Commission is charged with theongoing responsibilities of evaluating theeffects of the sentencing guidelines on thecriminal justice system, recommending toCongress appropriate modifications ofsubstantive criminal law and sentencingprocedures, and establishing a research anddevelopment program on sentencing issues.
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Disparity in sentencing, certainty ofpunishment, and crime control have longbeen issues of interest for Congress, thecriminal justice community, and the public. Before guidelines were developed, judgescould give a defendant a sentence that rangedanywhere from probation to the maximumpenalty for the offense. After more than adecade of research and debate, Congressdecided that: (1) the previously unfetteredsentencing discretion accorded federal trialjudges needed to be structured; (2) theadministration of punishment needed to bemore certain; and (3) specific offenders (e.g., white collar and violent, repeat offenders)needed to be targeted for more seriouspenalties. Consequently, Congress created apermanent commission charged withformulating national sentencing guidelines todefine the parameters for federal trial judgesto follow in their sentencing decisions.
The Commission has the authority tosubmit guideline amendments each year toCongress between the beginning of a regularcongressional session and May 1. Such amendments automatically take effect 180 days after submission unless a law is enactedto the contrary.
Innovations under the Guidelines System:
-Structured judicial discretion
-Appellate review of sentences
-Reasons for sentence stated on the record
-Determinate or “real time” sentencing
-Abolition of parole
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Organizations, like individuals, can be found guilty of criminal conduct, and the measure of their punishment for felonies and Class A misdemeanors is governed by Chapter Eight of the sentencing guidelines. While organizations cannot be imprisoned can be fined, sentenced to probation for up to five years, ordered to make restitution and issue public notices of conviction and apology to their victim, and exposed to applicable forfeiture statutes. Data collected by the Sentencing Commission reflect that organizations are sentenced for a wide range of crimes. The most commonly occurring offenses (in order of decreasing frequency) are fraud, environmental pollution, money laundering, antitrust, and food and drugviolations.
The organizational sentencing guidelines,which apply to all organizations whether publicly or privately held, and of whatever nature, such as corporations, partnerships, labor unions, pension funds, trusts, non-profit entities, and governmental units, became effective November 1, 1991, after several years of public hearings and analysis. Thesis guidelines were designed to further two key purposes of sentencing: "just punishment" and "deterrence." Under the "just punishment" model, the punishment corresponds to the degree of blameworthiness of the offender, while under the "deterrence" model, incentives are offered for organizations to detect and prevent criminal conduct within their ranks.
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Criminal liability can attach to an organization whenever an employee of the organization commits an act within the apparent scope of his or her employment, even if the employee acted directly contrary to company policy and instructions. An entire organization, despite its best efforts to prevent wrongdoing in its ranks, can still be held criminally liable for any of its employees’ illegal actions. Consequently, when the Commission promulgated the organizational guidelines, it attempted to alleviate the harshest aspects of institutional vulnerability to which organizations are subjected under these principles of vicarious liability by incorporating into the sentencing structure an opportunity for the mitigation of punishment.
The culpability of an organization is generally determined by six factors that the sentencing court must consider: The four factors that increase the ultimate punishment of an organization are: (i) the involvement in or tolerance of criminal activity; (ii) the prior history of the organization in terms of prior violations, including civil and administrative dispositions; (iii) the violation of an earlier court order during the occurrence of the offense which is being prosecuted; and (iv) the obstruction of justice. The two factors that mitigate the punishment of an organization are: (i) the existence of an effective compliance and ethics program; and (ii) the combination of the organization’s efforts in self-reporting, cooperating with the authorities, or accepting responsibility. The potential fine range for a criminal conviction can be significantly reduced—in some cases up to 95 percent—if an organization can demonstrate that it had Putin place an effective compliance and ethics program and that the criminal violation represented an aberration within an otherwise law-abiding community. This mitigating credit under the guidelines is contingent upon prompt reporting to the authorities and the non-involvement of high level personnel in the actual offense conduct. Conversely, the absence of an effective compliance and ethics program may be a reason for a court to place an organization on probation, and the implementation of such a program under court supervision may be a condition of a probationary term of up to five years under the organizational sentencing guidelines.
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The organizational sentencing guidelines offer incentives to organizations to reduce and ultimately eliminate criminal conduct by providing a structural foundation from which an organization may police its own conduct through an effective ethics and compliance program. The prevention and detection of criminal conduct should assist organizations encouraging ethical conduct and full compliance with all applicable laws.
The Commission revised and strengthened the criteria for an effective compliance and ethics program in 2004 in order to synchronize the guidelines with “best practices” as reflected by over a decade of guideline application within organizations, the Sarbanes-Oxley Act of 2002, and other relevant regulatory and administrative initiatives.
In 2004, the Commission elevated the criteria for an effective compliance and ethics program into a separate new guideline at§8B2.1 in order to emphasize the importance of such programs. It also elaborated upon these criteria, introducing additional rigor generally and imposing significantly greater responsibilities upon an organization’sgoverning authority (e.g., Board of Directors)and executive leadership.
In order to have an effective program as defined by the guidelines, an organization must demonstrate that it exercised due diligence in fulfilling the requirements andalso promoted in other ways “an organizational culture that encourages ethical conduct and a commitment to compliance with the law.”
The requirements for a effective programas defined by the guidelines are functionalones: it does not matter whether a program is called a compliance or ethics program or some other designation appropriate to the organization, as long as the organization can demonstrate that it incorporated and fulfilled the following requirements within its operational structure.
- Standards and procedures to prevent and detect criminal conduct• Responsibility at all levels and adequate resources, and authority for the program
- Personnel screening related to program goals
-Training at all levels
- Auditing, monitoring, and evaluating program effectiveness• Non-retaliatory internal reporting systems
-Incentives and discipline to promote compliance
- Reasonable steps to respond to and prevent further similar offenses upon detection of a violation
The Commission also made explicit in its 2004 amendments that the implementation and successful maintenance of an effective compliance and ethics program requires that organizations periodically assess the risk of criminal conduct. In addition, it provided guidance on the implementation of these requirements as well as suggested ways in which they may be adapted to the constraints of small organizations.
The organizational guidelines’ criteriaembody broad principles that, taken together,describe a corporate “good citizenship”model, and, as amended in 2004, offerconsiderably more guidance for their implementation. Flexibility and independence by organizations in designing programs that are best suited to their particular circumstances is encouraged.
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