“Loss” Is Ambiguous in Fraud Guideline, Allowing Deference to Commentary Inclusion of “Intended Loss”

US v. Boler: For the 2016 tax year, Boler filed six fraudulent tax returns (on her behalf and for others), of which four resulted in refunds totaling more than $116,000. Two of the returns were rejected, however, which would have been worth approximately another $21,000. Boler pleaded guilty to six counts of presenting false claims (as well as making a false statement on a PPP loan application). In the PSR, she was attributed an amount of loss that included the amount refunded to her, the PPP loan amount, and the $21,000 for the tax returns that were rejected. Boler objected, arguing that the definition of “loss” in the fraud Guideline should be limited to actual loss, not intended loss as set forth in the commentary. The district court disagreed and received a sentence of 30 months in prison, the bottom of the calculated Guideline range.

A divided Fourth Circuit affirmed Boler’s sentence. Boler’s primary argument was that the common meaning of “loss” was not ambiguous and did not include intended loss. As a result, the commentary ran afoul of Kisor and could not be applied. The court disagreed with both points. First, the court concluded that “loss” is, indeed, ambiguous, pointing to the numerous variations in definitions from dictionaries and how loss plays into relevant conduct calculations. Because it was ambiguous the commentary was applicable because its “character and context . . . entitle it to controlling weight.”

Judge Quattlebaum dissented, arguing that “sometimes lawyers and judges overcomplicate things,” that “this is one of those occasions,” and that the meaning of “loss” is not ambiguous and means only actual, not intended, loss.