Cuyahoga County PPP Loan Fraud Lawyers
You got a PPP loan in 2020. Maybe 2021. You're in Cuyahoga County - Cleveland, Lakewood, Parma, one of the surrounding areas. The pandemic was chaos. Everyone was applying for relief funds. You got approved, used the money, maybe even got forgiveness. Years passed. You figured the government had bigger priorities than chasing down small business loans from half a decade ago.
They haven't moved on.
The federal government turned PPP loan fraud prosecution into an assembly line - and the Northern District of Ohio is running it at full speed. In December 2024, their White Collar Crimes Unit issued an announcement highlighting COVID fraud prosecutions as a "notable achievement" for the year. The 10-year statute of limitations means that 2020 loan you thought was forgotten is prosecutable until 2030. Cleveland is not a safe haven. Ohio prosecutors are just as aggressive as their counterparts in Florida or New York.
Welcome to Spodek Law Group. We handle federal PPP loan fraud defense in Cuyahoga County and throughout the Northern District of Ohio. If you've received a letter from the SBA Office of Inspector General, if federal agents have contacted you, or if you're simply worried about that loan application from 2020 - this article explains exactly what you're facing and what options still exist.
The Clock Is Still Running
In August 2022, President Biden signed the PPP and Bank Fraud Enforcement Harmonization Act. Most people in Ohio never heard about it. Most people anywhere never heard about it.
It extended the statute of limitations from 5 years to 10 years - retroactively.
That means a PPP loan from 2020 is prosecutable until 2030. A loan from 2021 until 2031. The government gave itself a full decade to build cases, and there using it. But heres the part that catches people off guard. The clock dosent start from when you recieved the loan. It starts from the date of your last fraudulent act related to that loan. For most people, that wasn't the original application. It was the forgiveness application they submitted months or years later.
If you applied for forgiveness in 2021 or 2022, prosecutors may have until 2031 or 2032 to charge you. Ohio prosecutors know this. There not in a hurry. There methodical.
Cleveland Is Not a Safe Haven
People assume the heavy PPP enforcement is happening in Florida or New York or California. Big cities, flashy cases, headline-grabbing prosecutions. Ohio must be quieter. The Midwest must be less aggressive.
Wrong.
In December 2024, the Northern District of Ohio White Collar Crimes Unit issued a year-end statement. They specificaly highlighted COVID fraud prosecutions as one of there notable achievements for 2024. This isnt a district thats trying to move on from pandemic cases. This is a district thats proud of them.
The cases tell the story. Terrence Pounds of Canton, Ohio was sentenced to 94 months in federal prison. Nearly 8 years. For PPP fraud. In Ohio. He led a scheme that sought $9 million in COVID relief - the SBA approved about $3.3 million of it. The court also ordered him to pay $4,239,940 in restitution. Daniel Hitlan of Huron, Ohio got 27 months for $2.7 million in PPP fraud. He'd used the money to buy Rolex watches, a Cadillac Escalade, a vintage Corvette, and real estate. The court ordered restitution of $2,744,013.
More Northeast Ohio cases currently moving through the system:
- Robert Bearden of Cleveland: 12 months and 1 day for aproximately $60,000 in fraudulent COVID relief applications
- Joseph Oloyede and Edward Oluwasanmi of Medina and Willoughby: 13-count indictment for $4.2 million in fraudulent PPP and EIDL funds - charges include conspiracy, wire fraud, and money laundering
- James Stote and Phillip Augustin: Pleaded guilty in NDOH to leading a $35 million nationwide PPP fraud scheme
Defendants sentenced in 2024-2025 are recieving sentences approximately 40% longer then defendants who committed identical conduct but were sentenced in 2021-2022. Early pandemic leniency is completley over. Federal judges in 2025 include prison time in nearly every PPP fraud sentencing - regardless of the amount involved.
The Numbers Prosecutors Count On
According to Pandemic Oversight, as of December 31, 2024, the federal government had charged 3,096 defendants with pandemic relief fraud. Of those, 2,532 were found guilty - an 82% conviction rate. Of those found guilty, 1,741 received prison time. That's 81% of convicted defendants going to prison.
IRS Criminal Investigation reports even more striking figures. They've launched 2,039 COVID fraud investigations involving approximately $10 billion in attempted fraud. Their conviction rate in prosecuted cases: 97.4%. Average prison sentence in IRS-CI prosecuted cases: 31 months. As of February 2025, 569 individuals had been sentenced through IRS-CI PPP fraud cases.
The charge stacking creates exposure that seems almost absurd on paper:
- Wire Fraud (18 U.S.C. § 1343) - 20-30 years
- Bank Fraud (18 U.S.C. § 1344) - 30 years
- False Statements to SBA (18 U.S.C. § 1014) - 30 years
- Money Laundering (18 U.S.C. § 1956) - 20 years
- Aggravated Identity Theft (18 U.S.C. § 1028A) - mandatory +2 years consecutive
One PPP application can create theoretical exposure exceeding 100 years. In practice, sentences dont reach those levels - but charge stacking gives prosecutors enormous leverage in plea negotiations. Restitution amounts have reached as high as $71 million. More then 440 defendants have been ordered to pay $1 million or more.
Where Leverage Still Exists
Not every PPP case ends in federal prison. There are intervention points - but most people dont know about them, and the window closes faster then you'd expect.
Theres a critical period - typically six to twelve months - between when the SBA Office of Inspector General flags a loan and when the case gets referred to the FBI for criminal investigation. During this window, civil resolution may be possible. Repayment plus a fine. Maybe a False Claims Act settlement. Not pleasant, but not a federal felony conviction either.
Once the FBI has the case, options narrow dramatically.
The OIG stage is were leverage exists. The FBI stage is were your fighting to minimize damage. Knowing which stage your case is at changes everything about strategy.
But some things make any situation worse. Several recent cases have shown people who talked to investigators without counsel ended up charged with obstruction or making false statements to federal agents - in addition to the underlying PPP fraud. The agents seem friendly. There not on your side. Voluntary repayment without legal guidance can be used as evidence of consciousness of guilt. The DOJ has been explicit about this.
If your under investigation or concerned you might be:
- Don't destroy any documents. Document destruction can become a seperate charge.
- Don't discuss the matter with others who may be involved. Those conversations can be used against you.
- Don't make voluntary payments to the SBA without counsel. This can be used as consciousness of guilt.
- Don't talk to federal agents without a lawyer present. You have the right to representation.
- Contact a federal defense attorney immediatly. The earlier you act, the more options exist.
Todd Spodek has handled PPP fraud investigations in the Northern District of Ohio. He understands the difference between OIG-stage investigations where civil resolution may be possible and FBI-stage investigations where criminal defense becomes the priority.
When Your Ready
If your in Cuyahoga County - or anywhere in the 40 northern Ohio counties covered by the Northern District - and your facing a PPP loan fraud investigation, Spodek Law Group can help you understand were you stand and what options exist.
The consultation is free. Theirs no obligation.
What you'll get is an honest assessment. Is this still at the OIG stage were civil resolution might be possible? Has it been referred to the FBI? What does the evidence look like? What are realistic outcomes - not best-case fantasies, but actual possibilities based on how these cases play out in federal court?
Call us at 212-300-5196. The statute of limitations runs until 2030 or later depending on when you got the loan and when you applied for forgiveness. The government has time. But once they move, things happen fast. The earlier you have counsel, the more leverage exists.
Don't wait until federal agents show up at your door.
Were here when you need us.
