United States v. White: Clarifying “Actual Loss” under U.S.S.G. §2B1.1 and Factual Basis for Aggravated Identity Theft

Introduction

This case arises on appeal from the Southern District of New York after Raymond White pleaded guilty to a multi-count fraud indictment. White admitted to devising a scheme to defraud the District of Columbia Army National Guard (DCARNG) by obtaining a construction contract under false pretenses. The central issues on appeal were (1) whether the district court erred in calculating the loss amount for Sentencing Guidelines purposes, (2) whether there was a sufficient factual basis for White’s plea to aggravated identity theft under 18 U.S.C. §1028A, and (3) whether White’s trial counsel provided ineffective assistance by failing to challenge the factual basis for that plea. The Second Circuit, in a summary order, affirmed the district court’s judgment in full, reinforcing key principles in fraud sentencing and Rule 11 plea-basis requirements.

Summary of the Judgment

On April 11, 2025, a three-judge panel of the Second Circuit affirmed the district court’s sentencing decision. The court held that:

The district court’s calculation of “actual loss” under Sentencing Guidelines §2B1.1—measured as the difference between White’s fraudulent contract award and the replacement contract awarded after the fraud was discovered—was neither clearly erroneous nor legally improper.
There was a sufficient factual basis for White’s guilty plea to aggravated identity theft (Count Four). White’s use of another individual’s signature and Social Security number to secure loan guarantees and mislead the Small Business Administration was “at the crux” of the predicate fraud offenses.
White did not demonstrate prejudice under Strickland v. Washington when arguing ineffective assistance of counsel for failing to object to the factual basis of Count Four; even if counsel had objected, the result would not have been different.

Analysis

Precedents Cited

The court relied heavily on several guiding precedents:

United States v. Turk, 626 F.3d 743 (2d Cir. 2010): Established that the loss determination under §2B1.1 is the most consequential Guidelines issue in fraud cases, capable of raising offense levels by up to 30 points based on dollar thresholds.
United States v. Canova, 412 F.3d 331 (2d Cir. 2005): Addressed “reasonably foreseeable” procurement‐fraud loss, particularly substitution of goods and services, and explained when replacement costs may constitute substantial loss.
Robers v. United States, 572 U.S. 639 (2014): In the restitution context, held that market fluctuations are foreseeable losses attributable to a defendant’s fraud.
Dubin v. United States, 599 U.S. 110 (2023): Articulated the “at the crux” test for aggravated identity theft offenses under §1028A, clarifying when misuse of an identity means is integral to the underlying crime.
United States v. Omotayo, 132 F.4th 181 (2d Cir. 2025): Applied Dubin to fraud cases and specified three sub-elements for “at the crux” analysis.

Legal Reasoning

1. Loss Calculation under U.S.S.G. §2B1.1: The court reviewed the district court’s application of the Guidelines de novo and its factual findings for clear error. It held that “actual loss” includes “reasonably foreseeable pecuniary harm”—not only direct out-of-pocket refunds but also replacement contract costs, administrative reprocurement expenses, and inflation. By measuring the loss as the price differential between White’s fraudulent contract and the subsequent DCARNG award, the district court’s approach aligned with application notes 3(A)(i) and 3(A)(v)(II).

2. Factual Basis for Aggravated Identity Theft: Under Rule 11(b)(3), a district court must ensure the defendant’s admissions cover every element of the charged offense but need not predict jury verdicts. The Second Circuit applied the “at the crux” framework from Dubin and Omotayo and concluded that White’s repeated use of another’s signature, date of birth, and Social Security Number to secure SBA guarantees was an integral, deceptive tool to advance his fraud. Even on plain-error review, White failed to show a reasonable probability he would have gone to trial had the district court demanded a more detailed factual record.

3. Ineffective Assistance Claim: Applying Strickland, the court held that White could not demonstrate prejudice from his counsel’s failure to object to the Rule 11 colloquy for Count Four, because the factual record amply supported the charge and White would have pled guilty regardless.

Impact

This decision reinforces several critical points for future fraud and sentencing jurisprudence:

District courts have discretion to quantify “reasonable foreseeability” of procurement recompetition costs, including market fluctuations, in calculating loss under §2B1.1.
The “at the crux” test for aggravated identity theft will be satisfied when identity misuse is both a “key mover” in a fraud scheme and deployed “fraudulently” at the heart of the criminal conduct.
Rule 11(b)(3) plain-error review places the burden on defendants to show a reasonable likelihood they would have rejected a plea absent a more robust factual proffer.

Complex Concepts Simplified

“Actual Loss” vs. “Intended Loss”: Under §2B1.1, sentencing focuses on whichever amount is greater. “Actual loss” is what the victim actually lost; “intended loss” is what the defendant sought to take.
Reasonably Foreseeable Pecuniary Harm: If a defendant forces a victim to rebid or reprocure services, added administrative and market‐driven costs count as loss.
“At the Crux” Test: For aggravated identity theft, it’s not enough to use another’s identity in a side aspect of a crime. The identity use must be pivotal to perpetrating the fraud.
Plain-Error Review: If a defendant fails to object in district court, an appellate court will rectify only clear, prejudicial errors that seriously affect judicial integrity.

Conclusion

United States v. White affirms that fraud‐based “actual loss” calculations under the Sentencing Guidelines encompass replacement contract differentials and foreseeable reprocurement costs. It also cements the “at the crux” standard for pleading aggravated identity theft, demonstrating that repeated misuse of personal identifiers to secure government contracts is sufficiently integral to the underlying fraud. Taken together, the decision provides a roadmap for lower courts in both sentencing procurement‐fraud defendants and evaluating the sufficiency of Rule 11 plea colloquies in identity‐theft contexts.