Case Explained: USA V. SHI v. BOWEN HU

Court: United States Court of Appeals for the Ninth Circuit Filed: 2026-07-02 Docket: 2:20-cr-00621- The Ninth Circuit affirmed in part and vacated in part the sentences imposed on defendants Blade Bai, Bowen Hu, and Tairan Shi for their convictions regarding a conspiracy to launder Target gift cards purchased by telephone-scam victims, remanding for a limited resentencing. The court held that the district court did not err in calculating the loss amount as approximately $2.5 million under U.S.S.G. § 2X1.1(a) and § 2S1.1(a)(2), rejecting the defendants’ argument that intended loss could not be included in the value of laundered funds for base offense level determinations. Additionally, the panel affirmed the district court’s denial of a three-level reduction under U.S.S.G. § 2X1.1(b)(2) and its application of a three-level manager/supervisor enhancement under § 3B1.1(b) to Hu and Shi, finding no abuse of discretion regarding the defendants’ control over runners or their culpability relative to other participants. The court vacated the sentences due to the district court’s improper application of the two-level sophisticated laundering enhancement under U.S.S.G. § 2S1.1(b)(3). Applying de novo review, the panel determined that the plain language and structure of the Guidelines require a district court to actually apply the two-level increase for conviction under 18 U.S.C. § 1956 pursuant to subsection (b)(2)(B) before the sophisticated laundering enhancement in subsection (b)(3) can be triggered. Because the district court applied the four-level “business of laundering funds” enhancement under subsection (b)(2)(C) instead of the two-level conviction enhancement, the condition precedent for the sophisticated laundering enhancement was not satisfied. Consequently, the practical consequence is that the defendants’ sentences are vacated and remanded specifically for the limited purpose of adjusting the guideline computation to remove the erroneous two-level enhancement and resentencing based on the corrected range, without requiring a plenary resentencing. Do It For The Case Law is a news reporting service. Nothing in this episode constitutes legal advice.