If you’ve spent any time in federal white-collar practice, you know the guidelines drill. Your client is charged with wire fraud, you pull up §2B1.1, and then you spend the next several hours (or days) wading through what has become one of the most Byzantine provisions in the entire Guidelines Manual.
Loss tables, specific offense characteristics stacked on specific offense characteristics, cross-references to other guidelines—it can feel less like legal analysis and more like assembling IKEA furniture without instructions.
After many years, and countless hours, spent in and out of court attempting to correctly apply this provision, the Sentencing Commission has heard the complaints. In December, it published proposed amendments that would significantly overhaul the economic crimes guideline for the first time in years.
The public comment period closes on February 10, 2026, and if you care about federal sentencing—whether you’re a defense practitioner, a prosecutor, or just someone who thinks the system should make sense—this is worth your attention.
The article seeks to examine what’s on the table, what it might mean for your cases, and what major voices in federal sentencing are saying about whether the Commission has gotten it right.
The Problem Everyone Agrees On
To appreciate what the Commission is trying to fix, it helps to understand how §2B1.1 became the behemoth it is today.
The original fraud guideline from 1987 was remarkably compact—the operative text and its loss table fit on roughly two pages, with three specific offense characteristics and no cross-references.
A defendant who maxed out every enhancement would land at offense level 19—for someone with no criminal history, this resulted in an advisory sentence of 30 to 37 months.
Fast forward to 2026, and the same guideline sprawls across six pages. It contains 20 specific offense characteristics and four cross-references. And a defendant who hits every enhancement?
When the process was complete, Sam Bankman-Fried’s total offense level clocked in at 60 on a sentencing table that only goes up to 43. When your formula produces results that are dramatically off the charts, something has gone wrong.
How did this happen? The Commission itself recognized this problem. In its 2004 Fifteen Years of Guidelines Sentencing report, the Commission acknowledged what commentators had termed ‘factor creep’, the steady accretion of enhancements that made the guidelines increasingly complex.
Every few years, Congress passes a new law, a high-profile case generates headlines, or an advocacy group makes a compelling argument, and suddenly there’s a new enhancement.
Each proposal seems reasonable in isolation, but the cumulative effect is a guideline so complex that no one—not judges, not lawyers, not even the Commission itself—can fully understand how all the pieces interact.
On this point, there’s remarkable consensus across the ideological spectrum. The Federal Public and Community Defenders have called §2B1.1 “unwieldy” and warned against adding “unnecessary complexity to a guideline that already covers more than 5 pages, with more than a dozen pages of commentary.”
NACDL has advocated for a "wholesale reevaluation" of the guideline. Even former Justice Department officials have acknowledged that the current structure produces results that are difficult to justify.
The question isn’t whether reform is needed. It’s whether the Commission’s proposal is the right reform.
What the Commission Is Proposing
The December 2025 proposal tackles §2B1.1 in two main parts.
Part A: Simplifying the Loss Table
This is straightforward. The current loss table has 16 tiers, ranging from no increase (for losses under $6,500) to a 30-level increase (for losses exceeding $550 million). The Commission proposes collapsing this to eight broader tiers.
The practical benefit? Fewer battles over whether your client’s loss was $94,000 or $96,000. Under the current structure, those $2,000 can mean the difference between enhancement tiers—which translates practically to expensive expert witnesses, lengthy sentencing hearings, and all the inefficiencies that come with litigating marginal distinctions.
The proposed thresholds would start at $15,000 (triggering the first enhancement), then step up to $95,000, $250,000, and $1.5 million before reaching the high-loss categories. The Commission based these on fiscal year 2024 data, grouping roughly 20% of sentenced cases into each of the first five quintiles.
Part B: Adding New Culpability and Harm Factors
The Commission also proposes revising and adding specific offense characteristics:
- A new "non-economic harm" enhancement (2 to 4 levels) for offenses causing "substantial" psychological harm, emotional trauma, or reputational damage to victims
- Revised "sophisticated means" guidance requiring conduct that shows "a greater level of complexity than typical for an offense of that nature"
- New mitigating factors allowing 2-level reductions for defendants who acted under coercion, at the direction of an employer due to fear, or who were unusually vulnerable to persuasion
- Early remediation credit for defendants who voluntarily ceased criminal activity, returned money, or reported the offense before learning of an investigation
The mitigating factors represent genuinely new territory for §2B1.1, which has historically been much better at adding enhancements than recognizing mitigation. For defense practitioners, this development could be significant if it survives the amendment process.
The Actual Loss vs. Intended Loss Problem
For practitioners in the trenches, one of the most consequential aspects of the proposal may be what it does—and doesn’t do—about the definition of “loss.”
Under current Application Note 3(A), loss is defined as "the greater of actual loss or intended loss." As so many of us that wrestle with this section regularly know, this means a defendant can be sentenced based on what they intended to steal, even if the scheme failed completely and no one lost a dime.
In PPP fraud cases, for example, defendants who applied for $35 million but only received $18 million face sentencing exposure based on the higher figure.
This has always been controversial, but it became a live circuit split after the Supreme Court’s decision in Kisor v. Wilkie narrowed the deference courts owe to agency interpretations of ambiguous regulations.
In 2022, the Third Circuit held in United States v. Banks that the term "loss" in §2B1.1 is unambiguous and means "actual loss"—period. The court declined to defer to the commentary’s intended loss definition, and the defendant’s offense level dropped from 19 to 7.
Other circuits, including the Sixth Circuit in United States v. You, have continued applying intended loss under the commentary.
The result is that defendants in the Third Circuit may be sentenced very differently than defendants in other circuits for identical conduct. That’s exactly the kind of unwarranted disparity the Guidelines were designed to eliminate.
The Commission’s response? Move the “greater of actual or intended loss” rule from the commentary into the guideline text itself. This would effectively codify the government’s position and eliminate the Banks argument nationwide.
Defense practitioners should understand what this means: if adopted, the intended loss definition will have the force of guideline text, not just commentary. The Kisor-based challenges that have gained traction in some circuits will be foreclosed. For defendants whose schemes failed or were intercepted before completion, this is not a favorable development.
The Federal Public Defenders have long argued that the intended loss framework "overstates the harm suffered and unfairly punishes defendants for hypothetical futures that never came to exist." That argument will now need to be made directly to sentencing judges under § 3553(a), rather than as a challenge to the guideline calculation itself.
What the Critics Are Saying
While most observers welcome simplification of the loss table, opinion is more divided on Part B’s approach to culpability factors.
The Federal Public Defenders have consistently argued that §2B1.1 is "fundamentally flawed and in need of holistic reform."
In a February 2024 statement submitted to the Commission on behalf of Federal Public and Community Defenders, they’ve traced the history of the loss table as "a one-way upward ratchet" and questioned whether adding more factors—even helpful mitigating ones—addresses the core problem.
Their concern is that the guideline has become so disconnected from empirical sentencing data that tinkering at the margins won’t restore coherence.
NACDL has called for reducing "the extent to which offense levels are based on loss amount" and endorsed the framework proposed by the American Bar Association’s Task Force on Economic Crime Sentencing back in 2014.
That proposal would replace the current multi-factor algorithm with a more holistic assessment of culpability (high, medium, or lesser) and harm (across five categories), treating the relevant factors as considerations rather than formulas.
Jonathan Wroblewski, writing in the Sentencing Resource Counsel’s Sentencing Blog, argues that the Commission’s approach “continues down the rabbit hole of complexity.”
His concern is structural: in a post-Booker world where the Guidelines are advisory, Step One (calculating the guideline range) is supposed to provide a comprehensible starting point for Step Two (the § 3553(a) analysis).
When Step One is so complicated that judges can’t understand how the pieces fit together, it loses its value as a meaningful benchmark.
The defense bar has generally welcomed the proposed mitigating factors while expressing concern about the new non-economic harm enhancement.
The worry is that "substantial non-economic harm" is vague enough to become a routine government request in any case involving individual victims, creating new litigation burdens without clear limiting principles.
What This Means for Practice Now
Whether or not the Commission adopts these amendments (and in what form), the current proposal signals where federal economic crime sentencing is headed. Here’s what practitioners should be thinking about:
Understand the loss definition stakes. If the intended loss rule moves into guideline text, the arguments that have worked in some circuits will be foreclosed. Prepare to make your case for actual-loss-based sentencing under § 3553(a) as a variance argument rather than a guideline interpretation argument.
Build your record for mitigation early. The proposed reductions for coercion, employer direction, and early remediation aren’t law yet, but the concepts are powerful.
If your client stopped the conduct before the investigation, document it. If your client was the low-level employee following orders, develop that narrative from the start. These arguments work under current § 3553(a) analysis even without a specific guideline provision.
Prepare for non-economic harm battles. If the new enhancement passes, expect prosecutors to argue it in any case with identifiable victims. You’ll need to be ready with evidence that claimed harms are speculative, remediable, or already addressed through restitution.
Rethink your loss litigation strategy. With broader tiers, marginal loss disputes may become less important than other factors. Shift your preparation time accordingly.
Consider submitting comments. The deadline is February 10, 2026. Comments can be submitted electronically at comment.ussc.gov. The Commission reads practitioner input, and the defense bar’s voice matters in shaping final amendments.
The Bigger Picture
At its core, this debate is about what the Guidelines are supposed to accomplish in 2026. Are they meant to calculate precise sentences through ever-more-detailed formulas? Or are they meant to guide human judgment toward fair outcomes in a system where no two cases are exactly alike?
The Commission’s current proposal tries to simplify in some respects while adding new complexity in others. Whether that’s the right balance—or whether more fundamental reform is needed—is a question the Commission is actively considering.
What everyone seems to agree on is that the status quo isn’t working.
When a guideline produces offense levels that are literally impossible to plot on its own chart, when the majority of sentences fall below the recommended range, and when experienced practitioners struggle to explain to clients how their exposure is calculated, something needs to change.
The February 10 deadline is approaching. This is the moment to weigh in.
