Indianapolis PPP Loan Fraud Lawyers

Indianapolis PPP Loan Fraud Lawyers

The SBA Office of Inspector General sent you a letter requesting documentation for your Paycheck Protection Program loan — documents you know you can’t produce because the numbers weren’t accurate. Or maybe an FBI agent left a business card at your Indianapolis office asking you to call about your 2020 PPP application. Perhaps your business partner just told you he’s been interviewed by federal investigators, and now you’re terrified they’re coming for you next.

Whatever brought you here, you’re discovering that PPP loan fraud isn’t a civil audit problem — it’s a federal criminal investigation being prosecuted in the United States District Court for the Southern District of Indiana, and people are going to prison for many, many years.

The federal cases from 2024 and 2025 tell the story clearly. Meelad Dezfooli was sentenced in August 2025 to 188 months in federal prison — over 15 years — for submitting three fraudulent PPP applications totaling $11.8 million using false tax records and inflated payroll numbers, then laundering the proceeds through approximately 25 properties and luxury cars. Tamara Starks received 86 months in January 2025 for submitting over 100 fraudulent PPP applications totaling $4.5 million between May 2020 and May 2021, creating fake payroll documentation for nonexistent businesses. Loretta Clarice James was sentenced to 96 months in May 2025 for a $1.5 million fraud scheme that included using stolen Social Security numbers. Even Rakita Davis, a 45-year-old IRS employee from Fort Wayne who fraudulently obtained just $55,213 by claiming to operate a non-existent catering business, received 24 months of probation and was ordered to pay full restitution in May 2025 in the Northern District of Indiana. These aren’t outliers — the Department of Justice COVID-19 Fraud Enforcement Task Force has been prosecuting PPP fraud cases aggressively through 2025, and the statute of limitations was extended to 10 years, which means investigations that started in 2020 will continue through 2030.

What You Do in the Next 48 Hours

You’re experiencing what every PPP fraud target experiences — the visceral panic of realizing this is real, this is happening, this could destroy your life.

The SBA letter looks official and bureaucratic, but what it’s really saying is that federal investigators are examining whether you committed bank fraud under 18 U.S.C. § 1344, which carries a maximum sentence of 30 years in federal prison and a $1 million fine. The FBI agent’s business card seems innocuous, they probably said they just want to “clarify a few things” about your loan application, but what they’re actually doing is building a criminal case and hoping you’ll make statements without counsel that they can use against you at trial.

Most PPP fraud defendants make critical mistakes in the first 48 hours.

They talk to federal agents thinking they can explain away the discrepancies, they don’t realize that every statement they make is being documented and will be used to prove knowledge and intent. They try to “fix” documentation after receiving the inquiry — creating backdated payroll records or revised tax forms — which transforms a potential fraud case into an obstruction of justice case with additional charges. They ignore the contact entirely, hoping it will go away, not understanding that silence is interpreted as consciousness of guilt and that investigators will simply gather evidence without hearing your side. Or they immediately pay back the loan thinking that resolves the criminal exposure, when in reality voluntary repayment can be seen as an admission that you knew the loan was fraudulently obtained.

What you do right now — in the next 48 hours, before you respond to any government inquiry — determines whether you face criminal charges or whether your attorney can negotiate a civil resolution. The Rakita Davis case demonstrates this point perfectly. She received 24 months of probation rather than prison time despite fraudulently obtaining over $55,000 and spending it on jewelry, vacations, and luxury vehicle rentals. The difference between probation and prison time in federal fraud cases often comes down to early cooperation, acceptance of responsibility, and having experienced federal criminal defense counsel who can frame your conduct in context to prosecutors before charging decisions are made.

Can They Actually Prove You Committed a Crime?

You’re probably asking yourself the question every PPP fraud target asks: can they actually prove I committed a crime? The answer depends on what federal prosecutors can demonstrate beyond a reasonable doubt, which is not the same thing as showing that your loan application contained inaccuracies. To convict you of wire fraud under 18 U.S.C. § 1343 or bank fraud, the government must prove that you knowingly submitted false information with the specific intent to defraud the lender and the SBA — not that you made mistakes, not that you were confused about the complex and rapidly-changing PPP eligibility rules, but that you deliberately lied to steal money from a federal program.

The Meelad Dezfooli prosecution shows exactly how the government builds these cases. Federal investigators obtained his loan applications showing he claimed dozens of employees and hundreds of thousands in payroll expenses for three businesses. Then they subpoenaed his actual tax returns, which showed dramatically lower revenues and payroll. Then they subpoenaed his bank records, which showed the PPP funds being transferred to purchase approximately 25 properties under the alias “James Dez,” luxury vehicles, and extensive gambling in Las Vegas. Then they interviewed his accountant, who testified that the tax documents submitted with the loan applications were falsified. Then they analyzed utility bills he’d submitted as proof of business operations, which were fabricated. By the time the case went to trial, prosecutors could trace every fraudulent statement in the applications, prove he created false documentation, and show he knew exactly what he was doing because he used an alias to hide the proceeds.

Your case is likely following the same investigative pattern right now, even if you don’t know it yet. Federal agents are subpoenaing your bank records to see how you spent the PPP funds — if the money went to personal expenses rather than payroll, that’s evidence of intent to defraud. They’re obtaining your tax returns for 2019, 2020, and 2021 to compare the payroll numbers you certified on your PPP application against what you actually reported to the IRS — any significant discrepancy becomes evidence that you knowingly inflated the numbers. They’re interviewing your employees, asking them how many hours they worked, how much they were paid, whether they were actually on payroll during the covered period — if employee testimony contradicts your loan certifications, that’s powerful evidence. They’re reviewing your loan forgiveness application to see if you submitted false documentation to avoid repaying the loan — forgiveness fraud is treated as a continuation of the original fraud and increases sentencing exposure.

But here’s what prosecutors don’t want you to know: intent to defraud is difficult to prove if you have a legitimate good-faith defense. The CARES Act that created the PPP program was enacted in March 2020 during the chaos of the pandemic, the eligibility rules were ambiguous and changed repeatedly, the SBA issued conflicting guidance, and many business owners made reasonable interpretations that turned out to be incorrect. If you relied on your accountant’s advice about eligibility, if you genuinely believed your business qualified based on the economic uncertainty guidance, if you made arguable calculations about payroll costs that included owner compensation — these are viable defenses that negate the intent element. The investigation phase is when your federal defense attorney provides this context to prosecutors, presents evidence of your good-faith belief, and makes the case that criminal charges aren’t warranted for what amounts to a civil dispute about program interpretation.

Who’s Talking About You?

There’s a reason you’re Googling PPP fraud late at night, refreshing news sites looking for information — you’re worried about who might be cooperating against you.

And you should be worried.

The federal system is designed to incentivize cooperation. The U.S. Sentencing Guidelines § 2B1.1 provides substantial reductions for defendants who accept responsibility and provide substantial assistance to prosecutors, which in practice means implicating others involved in fraud schemes. If you submitted PPP applications with help from a consultant or accountant who prepared false documentation for multiple clients, that person may already be talking to federal agents. If you helped business associates obtain loans using inflated numbers, those associates are making the same calculation you’re making right now — cooperate first or face the harshest sentence.

The Renetta Golden-Larimore case demonstrates how PPP fraud schemes unravel. The 56-year-old Kansas City resident prepared and filed approximately 43 fraudulent PPP applications for others between February 2021 and May 2022, charging fees between $2,000 and $7,000 per application and earning at least $75,833. She created counterfeit IRS forms for nonexistent businesses and helped clients obtain loan forgiveness. When federal investigators identified the pattern — multiple fraudulent applications with similar characteristics, prepared by the same IP address, containing identical types of fake documentation — they charged her with conspiracy to commit wire fraud. She was sentenced in June 2025 to 51 months in federal prison and ordered to pay $908,278 in restitution. But here’s the important part: she was charged in two separate federal indictments, which means prosecutors flipped some of her clients who then testified against her, and likely she’s now cooperating against others to reduce her sentence.

Jacob Liticker’s prosecution tells a similar story. The 27-year-old Houston resident led a scheme that submitted 86 fraudulent PPP loan applications totaling $870,000, many for individuals residing in South Carolina. He was sentenced in October 2024 to 24 months in federal prison. The relatively lenient sentence suggests he cooperated extensively.

If you’re in a similar situation — if you prepared applications for others, if others prepared your application, if multiple people in your network obtained PPP loans using the same inflated methodology — you need to understand that this is a race to cooperation. Federal prosecutors offer sentencing reductions through plea agreements that include cooperation provisions, but those offers are time-limited and preferential to the first conspirators who come forward. The target letter you might receive will specify a deadline for your attorney to contact the Assistant U.S. Attorney’s Office — that deadline isn’t arbitrary, it’s the window during which you can negotiate cooperation before prosecutors lock in their charging decisions. This is why having a federal criminal defense attorney with relationships in the Southern District of Indiana U.S. Attorney’s Office becomes critical — they can facilitate proffer sessions where you provide information under limited immunity, negotiate the scope of cooperation, and secure written agreements about sentencing recommendations before you commit to a position.

How Much Time Are We Talking About Here

Let’s talk about numbers. That’s what you really want to know — how much time are you facing if this goes all the way to sentencing?

The federal cases from 2024 and 2025 provide a clear spectrum. At the lowest end, you have Rakita Davis, who fraudulently obtained $55,213 and received 24 months of probation with full restitution but no prison time. Roderick Bashon Billingslea received 30 months for fraudulently obtaining $564,363 by inflating employee numbers and falsifying records, sentenced in August 2024 in the Northern District of Georgia. Jacob Liticker got 24 months for his role in facilitating $870,000 in fraudulent loans across 86 applications. Moving up the scale, Renetta Golden-Larimore received 51 months for operating a $900,000 fraud scheme where she prepared fake applications for others. Tamara Starks was sentenced to 86 months for submitting over 100 fraudulent applications resulting in $4.5 million in disbursements. Loretta Clarice James got 96 months — eight years — for a $1.5 million scheme that included identity theft charges.

And at the top, Meelad Dezfooli received 188 months — over 15 years — for an $11.8 million fraud with extensive money laundering.

These sentences aren’t random — they follow the federal sentencing guidelines, which calculate a recommended range based primarily on the fraud amount. Under the guidelines, fraud losses of $150,000 to $250,000 trigger a base offense level increase of 12 levels, losses of $550,000 to $1.5 million add 16 levels, losses of $3.5 million to $9.5 million add 20 levels, and losses over $25 million add 26 levels. Then prosecutors add enhancements: if you were an organizer or leader of a scheme involving multiple participants, that’s a 4-level increase. If the offense involved sophisticated means or occurred over a prolonged period, that’s a 2-level increase. If you obstructed justice — by destroying evidence, lying to investigators, or encouraging others not to cooperate — that’s another 2-level increase. Each guideline level represents months or years of additional imprisonment.

But here’s what changes the calculation dramatically: acceptance of responsibility. If you clearly demonstrate acceptance of responsibility for your offense, you receive a 3-level reduction — and if your offense level is 16 or greater and you timely notify authorities of your intention to plead guilty, you can get an additional 1-level reduction for a total 4-level decrease. This reduction is only available if you plead guilty before trial, cooperate with investigators, and don’t obstruct justice. In practice, this means defendants who accept responsibility and cooperate receive sentences 35-40% lower than those who proceed to trial and are convicted. The difference between Meelad Dezfooli’s 188-month sentence and Jacob Liticker’s 24-month sentence for similar types of conduct — both involved submitting multiple fraudulent applications with false documentation — largely comes down to cooperation, acceptance of responsibility, and the total fraud amount.

Every single PPP fraud case requires full restitution — that’s mandatory, not discretionary. If you fraudulently obtained $200,000 in PPP funds, you will be ordered to repay $200,000 regardless of whether you still have the money, regardless of your current financial situation, regardless of any other penalties. Beyond restitution, judges can impose fines up to $250,000 for wire fraud or up to $1 million for bank fraud, though in practice fines are often waived if defendants don’t have assets beyond what’s needed for restitution. The government will also seek forfeiture of any assets purchased with fraudulently obtained PPP proceeds — vehicles, real estate, investment accounts, luxury goods. In the Meelad Dezfooli case, he forfeited approximately 25 properties and multiple vehicles. In the Renetta Golden-Larimore case, she forfeited $75,833 in personal proceeds beyond the restitution obligation.

Federal Court Is Different

PPP fraud cases are prosecuted in federal court — for Indianapolis defendants, that’s the United States District Court for the Southern District of Indiana. This matters because federal criminal defense is fundamentally different from state criminal defense. Federal prosecutors are Assistant U.S. Attorneys who handle complex white-collar cases exclusively, they have extensive resources including FBI agents, IRS Criminal Investigation specialists, and SBA Office of Inspector General investigators working on their cases. They have years to build cases before charging, they have conviction rates over 90%, and they’re not interested in quick plea deals unless defendants provide substantial cooperation. You need a federal criminal defense attorney who is admitted to practice in federal court, who has handled white-collar fraud cases, and who has professional relationships with the Assistant U.S. Attorneys in the Indianapolis office.

What does experienced federal defense counsel actually do during the investigation phase, before charges are filed? They contact the prosecutor handling the investigation and request a meeting to discuss the case. They provide context about your business, your reasonable interpretation of ambiguous PPP eligibility rules, your reliance on professional advice, your genuine belief that you qualified for the loan. They present evidence that negates intent — emails showing you sought guidance about the application, documentation of your business’s financial distress during the pandemic, tax returns showing you reported income consistently with your loan application. They negotiate for a civil resolution — agreeing to repay the loan with interest and civil penalties in exchange for the government declining criminal prosecution. If criminal charges are inevitable, they arrange voluntary surrender so you’re not arrested at your home or business, they negotiate bail conditions, and they begin building mitigation for sentencing.

During the prosecution phase, after charges are filed, experienced counsel challenges evidence through pretrial motions, arguing that certain documents were obtained through improper searches, that witness testimony is unreliable, that the government can’t prove the intent element beyond a reasonable doubt. They analyze every loan document to identify ambiguities in the PPP program rules that support a good-faith defense. They review statements you made to investigators and move to suppress any that were obtained in violation of your rights. They negotiate plea agreements that minimize guideline enhancements — fighting to avoid the sophisticated means enhancement, the leadership role enhancement, the obstruction increase. They prepare sentencing memoranda with letters from family, employers, and community members explaining your character, your contributions, your lack of criminal history, your remorse.

Todd Spodek has represented clients in federal fraud investigations for many, many years. Most PPP fraud defendants aren’t career criminals — they’re business owners who made bad decisions during an unprecedented pandemic when the rules were unclear and everyone was desperate to survive. The goal is to frame your conduct in that context to prosecutors and judges, to show that while you made mistakes, you didn’t act with the criminal intent that warrants federal imprisonment.

Thanks for visiting Spodek Law Group — a second-generation law firm managed by Todd Spodek. We handle federal fraud investigations and prosecutions in Indianapolis and throughout the Southern District of Indiana. Call 212-300-5196 today for a confidential consultation.