NEW JERSEY CRIMINAL LAWYERS

Connecticut PPP and EIDL Loan Fraud Lawyers

Protecting Your Business Against DOJ Investigation for PPP Loan Fraud

The Rise of PPP Loan Fraud Cases

The COVID-19 pandemic has adversely affected businesses worldwide, leading many to bankruptcy or closure. The Paycheck Protection Program (PPP) has been a beacon of hope for numerous entrepreneurs, providing much-needed financial support to pay essential expenses such as salaries, rent, and utilities. However, the massive scope of the program has given unscrupulous fraudsters enormous opportunities to take advantage of the situation, leading to an increase in PPP loan fraud cases.

The United States Department of Justice (DOJ) is taking this issue very seriously and has issued multiple indictments and started several investigations. The DOJ works closely with other federal agencies such as the Small Business Administration Office of the Inspector General (SBA-OIG), Federal Deposit Insurance Corporation Office of the Inspector General (FDIC-OIG), Federal Bureau of Investigation (FBI), and Internal Revenue Service-Criminal Investigation (IRS-CI) to investigate and prosecute PPP loan fraud cases.

DOJ Targets for PPP Loan Fraud

The DOJ is taking an aggressive approach to investigate and prosecute PPP loan fraud allegations. Companies and individuals that have fraudulently obtained PPP loans or misused them for unauthorized purposes are under investigation. In a recent press release, the DOJ stated its strong intentions to target anyone who abuses this critical program. Consequently, a large number of investigations and indictments have ensued.

Potential Charges for PPP Loan Fraud

Although the CARES act which introduced the PPP program does not specifically provide for penal provisions for PPP loan fraud, there are various federal statutes that list offenses related to the scheme that may trigger criminal charges. These charges may include making false statements to the SBA or FDIC-insured banks, wire fraud, bank fraud, conspiracy, attempt, and false claims act violations. The possible ramifications of these charges are severe, including hefty fines, jail time, and even reputational damage.

Defenses to PPP Loan Fraud Charges

To counter an allegation of PPP loan fraud, some of the main defenses that individuals and companies use include lacking an intent to defraud, complying with PPP loan terms or lawfully obtaining PPP loans via adequate documentation. Proving a lack of intent to defraud can be challenging as it requires a detailed understanding of the program application procedures, and other related concepts. Nevertheless, these defenses may prove instrumental in fighting PPP loan fraud charges.

Protecting Yourself and Your Business against DOJ Investigation for PPP Loan Fraud

The consequences of facing PPP loan fraud charges may be dire; thus, immediate action is necessary to mitigate their impact. Seek the services of renowned attorneys who specialize in federal fraud cases, including Todd Spodek and his team at Spodek Law Group. They have extensive experience dealing with federal fraud cases, including PPP loan fraud allegations, which can help develop effective defense strategies.

Comply with PPP loan terms and maintain adequate documentation. This can go a long way in firmly establishing your claim as well as acting as evidence if needed. It’s crucial to also seek legal guidance before applying for PPP loans or receiving funds from such programs.

Conclusion

As the investigations into PPP loan fraud cases by the DOJ continue; it’s critical to understand the gravity of the situation and take all necessary steps to protect yourself and your business against any potential legal issues that may arise. By working alongside expert attorneys and focusing on defense strategies based on compliance, adequate documentation, or lack of intent; you can protect yourself and your business entirely from facing negative consequences associated with alleged fraudulent activity. Take action now!