Defend Yourself Against Possible PPP Loan Fraud Charges by the Department of Justice (DOJ)
The Paycheck Protection Program (PPP) was established as a financial assistance program to provide much-needed support to American businesses suffering from the impact of COVID-19. Despite its well-intentioned goals, individuals and companies exploited this program by submitting fraudulent applications for PPP loans, making unauthorized use of funds, and falsely certifying loan forgiveness. Consequently, the Department of Justice is conducting investigations into PPP fraud cases and prosecuting individuals found guilty of defrauding this initiative.
The DOJ is Actively Pursuing Charges in Numerous PPP Loan Fraud Cases
Individuals or business entities could potentially face severe criminal complaints resulting from PPP loan fraud accusations. The DOJ seeks to bring federal charges on various offenses against those found guilty of abusing this vital program.
The DOJ is Actively Working with Other Federal Law Enforcement Agencies to Target All Forms of PPP Loan Fraud
To combat all forms of fraudulent activities under the PPP, numerous law enforcement agencies like the US Small Business Administration Office of Inspector General (SBA-OIG), Federal Deposit Insurance Corporation Office of Inspector General (FDIC-OIG), Federal Bureau of Investigation (FBI), and Internal Revenue Service Criminal Investigations (IRS-CI) have joined forces with the DOJ to prosecute individuals or organizations that unlawfully exploit forgivable loans offered under this COVID-19 relief program.
Potential Defences that Individuals and Companies Can Assert During DOJ PPP Loan Fraud Investigations
Although facing allegations related to PPP loan fraud can be overwhelming, individuals or companies can assert several defenses during an investigation. Legal representatives handling such cases could rely on specific defenses detailed under the Paycheck Protection Program concerning statutory acts charged against them. For instance, one possible defense would be to prove compliance with the terms contained in the contract agreement for accessing these funds within a separate account created solely for such purposes while effectively putting the funds into legitimate use. Another defense available would be to establish a lack of intent to defraud as accusations for criminal culpability require evidence of an intention to commit fraud.
Possible Charges in Federal PPP Loan Fraud Investigations PPP loan-induced fraudulent acts can incur civil and criminal charges under various federal statutes. The table below provides detailed information on the potential federal PPP offenses individuals or businesses could face:
18 U.S.C. § 1014
It is a federal crime for knowingly making false reports/statements with the intent to deceive the Small Business Administration(SBA) or any financial institution.
18 U.S.C. § 1344
This statute comprises suspicious financial activities such as misappropriation, credits and funds abuse that can defraud financial institutions.
18 U.S.C. § 1343
This act targets wire fraud accusations and establishes fraudulent schemes through wire communications that result in the misallocation or embezzlement of funds.
18 U.S.C. § 1028A
The act prosecutes identity theft cases filed against individuals or companies who use false identities while applying for loans.
26 U.S.C. § 7201
Tax fraud accusations involving the illegal filing or falsification of tax returns can face prosecution under this statute.
18 U.S.C. § 1001
This statute applies to individuals or businesses who make false claims during a government audit or investigation.
18 U.S.C. § 371 and 18 U.S.C. § 1349
Individuals or companies involved in conspiracies, aimed at executing PPP-related offenses, face trial under this statute.
Individuals or businesses committing unsuccessful attempts to defraud PPP can face prosecutions under this offense.
Serial Number Statutes Descriptions
31 U.S.C. §§ 3729-3733
This statute captures the federal False Claims Act, which prosecutes individuals and organizations that file fraudulent claims designed to access government incentives or credits. Such offenses incur hefty fines and criminal penalties.
The DOJ remains unwavering in prosecuting individuals and companies that utilize PPP loans fraudulently. If you find yourself under investigation for PPP loan fraud, it is advisable to seek out the counsel of legal practitioners whose expertise covers this field. Todd Spodek is one such legal practitioner, whose vast knowledge and expertise revolving around PPP-related investigations would ensure you get the possible representation while navigating through the complex maze of litigation.
Protect Your Business from DOJ Investigations for PPP Loan Fraud The Paycheck Protection Program (PPP)…
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