Revised Federal Sentencing Rules Offer a White Collar Respite

Federal sentencing for economic crimes is facing its most significant recalibration in a decade—and for clients, the shift presents both real risk and real opportunity.

The amendments take effect Nov. 1 if Congress doesn’t disapprove or modify the proposals from the independent agency charged with oversight of the sentencing guidelines within 180 days. The deadline to submit significant amendments to Congress is May 1.

The timeline, coupled with notable amendments, makes it imperative for a subpoena recipient, or white collar defendant, to understand the changing landscape and steps that can be taken early on to advocate resolutions from the most advantageous position.

The US Sentencing Commission’s 2026 amendments include inflation adjustment, rewarding genuine rehabilitation, expanding sentencing types, and eligibility for alternative sentencing structures. For clients facing investigation or indictment, these changes make early, strategic defense involvement crucial.

Sentencing Background

When a defendant reaches the sentencing stage, a formulaic process is applied to determine the length and type of sentencing based on a point system. This process begins with determining the “base offense” level. For example, conspiracy to commit federal healthcare fraud begins at a base offense level of six.

Next, points are added based on the amount of actual or intended loss (whichever is greater). So, in the healthcare fraud conspiracy hypothetical, assuming an intended loss of $275,000, the guidelines call for a 12-point increase for losses that are more than $250,000 but less than $550,000. At this point, our hypothetical defendant has accrued a total of 18 points in the calculation.

The government may also seek enhancements available under the guidelines. Defendants can reduce their points through adjustments, typically by accepting responsibility.

Using the total offense level, the guidelines provide a sentencing table that is used to determine the available type and length of sentencing. The table contains two additional elements: First, defendants with a qualifying criminal history can expect to face longer sentences.

Second, the sentencing table groups offense levels into “zones” that determine the type of sentence available (probation, home detention, imprisonment, or a hybrid combination). Offense levels one through eight are Zone A; nine through 11 are Zone B; 12 through 13 are Zone C; and 14 through 43 are Zone D.

We’ll assume our hypothetical healthcare fraud conspiracy defendant received no enhancements or adjustments and has a total offense level of 18. We’ll also assume the defendant has no qualifying criminal history resulting in a Zone D placement that calls for 27 to 33 months of incarceration.

Let’s see how our hypothetical defendant fares under the 2026 proposed amendments.

Inflation Index

First, the commission proposes to lift every key dollar threshold in the economic guidelines to reflect inflation. Loss, tax, volume‑of‑commerce, and fine tables would all move upward, meaning that the same conduct measured in today’s dollars often will call for lower point increases based on loss amount than it would now.

The amendments for our hypothetical defendant with an intended loss of $275,000 would call for a 10-point increase, rather than the 12-point increase under the current framework.

This means our defendant, who previously was an 18-point offender facing 27-33 months of mandatory imprisonment, is now a 16-point offender under the proposed amendments which calls for a 21-27-month sentence term.

As we’ll see below, the amendments significantly expands the type of sentence the defendant may face.

Personal Transformation Adjustments

Perhaps the most defense‑friendly innovation is a proposed reduction for post‑offense rehabilitation. It would allow judges to reduce the offense level for defendants who take real, concrete steps toward change—paying restitution early, entering treatment, completing education, maintaining employment, doing meaningful community work, even helping others away from criminal conduct.

The reduction can be even greater if those efforts begin before any investigation is on the horizon. For a client willing to invest in remediation and personal transformation, an experienced defense team can design a rehabilitation plan that is both morally compelling and legally valuable at sentencing.

For the sake of comparing apples to apples, we’ll again assume no adjustments or enhancements were applied to our hypothetical defendant.

Sentencing Types

The commission is re‑centering the question most important to our clients: What type of sentence could be imposed?

The proposed expansion of Zones B and C would dramatically widen the universe of defendants who are even eligible for non‑custodial or partially custodial outcomes. Generally, a court can impose home detention in lieu of imprisonment if a defendant falls under Zone B, which compasses offense levels between level nine and 11 for offenders with no applicable criminal history.

Under the amendments, Zone B would expand to include those same offenders with total offense levels between nine and 23. This means that an offender certain to serve at least some time incarcerated could be sentenced to a full term of home detention.

In our example, the 16-point hypothetical healthcare fraud conspiracy defendant would now fall under Zone B, rather than Zone D, for sentencing purposes. As a zone B defendant, our hypothetical offender could receive home detention for the entire sentencing term rather than mandatory imprisonment under the current guidelines.

White Collar Clients

As we saw with our hypothetical defendant, the amendments significantly reduce the sentencing term and expand the sentencing types available. For our defendant, this was the difference between spending 27-33 months in prison and 21-27 months on home detention.

In this evolving landscape, white collar representation no longer can be just about trial skills. It must integrate sentencing science, data‑driven analysis, and proactive rehabilitation strategy from the moment a subpoena lands.

The clients who will fare best under the coming guidelines are those who treat sentencing advocacy as a parallel track to defense—and partner early with counsel who live in both worlds.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law, Bloomberg Tax, and Bloomberg Government, or its owners.

Author Information

William Shepherd is a partner at Holland & Knight whose clients are the targets of government inquiries or parties to complex civil litigation.

Henry Moreno is an associate at Holland & Knight focused on white collar criminal defense, government investigations, and commercial litigation.

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