Albuquerque EIDL Loan Fraud Lawyers

Albuquerque EIDL Loan Fraud Lawyers

You got a letter from the Small Business Administration Office of Inspector General about your EIDL loan. Or maybe federal agents – Homeland Security Investigations, FBI – showed up at your Albuquerque business asking questions about your 2020 loan application. You’re terrified. You’re wondering if you’re going to federal prison. Here’s what actually happens next.

Thanks for visiting Spodek Law Group – a second-generation law firm managed by Todd Spodek. We’ve represented clients in your exact situation for over 40 years. We know what happens when the SBA Office of Inspector General targets Albuquerque business owners, and we know how these cases actually resolve in New Mexico federal court in 2025.

The federal government handed out EIDL loans with minimal oversight during the pandemic. The SBA approved applications in 24 hours, asking almost no questions. Now in 2025, they’re prosecuting Albuquerque business owners for applications the government itself greenlit. That’s not fraud prosecution – that’s retroactive enforcement. Here’s what happens in YOUR situation over the next 6-18 months.

The Letter Arrives

The letter arrives certified mail from the SBA Office of Inspector General, requesting documentation about your Economic Injury Disaster Loan. They want your 2019 and 2020 tax returns, bank statements, payroll records. You have 30 days to respond. This window determines whether this becomes a federal criminal case or resolves administratively. Most Albuquerque business owners make the same mistake: they think cooperation prevents prosecution. They gather documents, write explanatory letters, try to “clear up the misunderstanding.” Here’s what they don’t realize – by the time SBA OIG sends that letter, federal investigators already have your tax returns, your bank records, your loan application. They’re testing whether you’ll provide contradictory statements they can use to prove criminal intent. Take the Albuquerque case from 2024: three residents were indicted for obtaining over $1 million in EIDL loans through applications that listed defunct companies, fabricated payroll data, and falsified tax documents. By the time suspects received contact from investigators, the Homeland Security Investigations Albuquerque Field Office had already interviewed former employees, subpoenaed financial records, and documented how the money was spent: private jet charter to Las Vegas, hiring a mariachi band, paying off personal credit cards. When SBA OIG asks “Did you have 10 employees in March 2020?” – they already know the answer from your quarterly tax filings. The question isn’t about gathering facts. It’s about whether you’ll lie under questioning, which transforms potential civil overpayment into federal wire fraud. That’s the trap.

What They’re Looking For

The investigation phase typically runs 6-12 months. Multiple federal agencies coordinate: SBA Office of Inspector General initiates, Homeland Security Investigations handles criminal components, IRS Criminal Investigation gets involved when there are tax implications.

Federal investigators look for specific red flags. In Albuquerque cases, the patterns are consistent: applications listing employees who don’t exist, payroll numbers that contradict IRS records, businesses formed days before the pandemic, identical applications filed for multiple shell companies, and luxury purchases made immediately after loan funding. The amount matters significantly. Cases under $20,000 are often declined even when fraud is apparent. Cases over $150,000 almost always result in federal charges, especially if the spending pattern shows personal use.

By the time federal agents request an interview, the investigation is essentially complete.

When They Say “Just Talk”

An investigator calls – or shows up – and says “We’d like to hear your side.” They’ll say it’s informal. This is where constitutional protections become critical. Choice one: agree to the interview without representation. Statements like “I thought everyone was padding their numbers to qualify” = confession to knowingly submitting false information under 18 U.S.C. § 1343, the federal wire fraud statute. Choice two: retain a federal criminal defense attorney before any interview. Your lawyer contacts the investigators, coordinates document production, and negotiates a pre-indictment resolution if possible. In some cases – particularly when the overpayment was small and clearly unintentional – defense counsel can arrange a civil settlement: you pay back the loan amount plus penalties, avoiding a federal conviction entirely. This only works if you hire representation BEFORE making statements. The Fifth Amendment right to counsel isn’t just for the guilty. The cooperation paradox: cooperating can reduce your sentence if convicted, but cooperation also gives prosecutors the evidence they need to build their case.

Wire fraud carries up to 30 years in federal prison. Bank fraud under 18 U.S.C. § 1014 carries another 30 years. Here’s what actually happens in Albuquerque federal court in 2025. Federal judges are including prison time in most EIDL fraud sentences. A July 2025 case resulted in 20 months in federal prison for fraudulently obtaining approximately $149,900. The Albuquerque defendants charged with obtaining over $1 million face realistic sentences of 5-10 years under a plea agreement, or potentially 15-20 years if convicted at trial. Sentencing follows the federal guidelines, which calculate punishment based primarily on the loss amount. Under $50,000 with acceptance of responsibility and cooperation: probation is possible. Between $50,000 and $150,000: split sentence likely. Over $150,000: significant prison time expected, typically 2-5 years for first offenders with plea deals. Restitution is mandatory – you must pay back the full loan amount plus interest and penalties. This obligation survives bankruptcy. Probation terms are severe: supervised release lasting 3-5 years, prohibition on starting or managing a business without permission, ongoing financial monitoring. The plea rate in federal court is 97%. Almost no one goes to trial.

At Spodek Law Group – we’ve handled cases others say were unwinnable. Todd Spodek is a seasoned criminal defense attorney with many, many, years of experience defending federal investigations. If SBA OIG contacted you – if federal agents asked to interview you – your next move matters. Call 212-300-5196.