King County PPP Loan Fraud Lawyers
You got a PPP loan in 2020. Maybe 2021. Every small business in King County did - the government was practically begging people to take the money during the pandemic. Seattle restaurants, Bellevue tech startups, Tacoma contractors. You filled out the application, got approved, maybe got forgiveness. Years passed. You moved on. You assumed the government had moved on too.
It hasn't.
The federal government turned PPP loan fraud prosecution into an assembly line - and King County is directly in the crosshairs. The Western District of Washington has prosecuted aggressively. Paradise Williams got 5 years in federal prison for a scheme that specifically targeted King County pandemic assistance programs. Congress extended the statute of limitations to 10 years retroactively. That 2020 loan you thought was forgotten? It's prosecutable until 2030.
Welcome to Spodek Law Group. We handle federal PPP loan fraud defense in King County and throughout the Western District of Washington. If you're under investigation, if you've received a letter from the SBA Office of Inspector General, or if federal agents have contacted you - this article explains exactly what you're facing and what options exist.
The Federal Government Is Still Coming For King County
In August 2022, Congress passed the PPP and Bank Fraud Enforcement Harmonization Act. Most people in Seattle missed what it actualy did.
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 come for you. And there using it. The DOJ's COVID-19 Fraud Enforcement Task Force coordinates across FBI, IRS Criminal Investigation, SBA OIG, and Secret Service. They have strike forces dedicated to this.
Every PPP loan ever issued in King County is now subject to prosecution for a full decade from the date of the offense.
Paradise Williams thought she was safe too. She submitted over 125 fraudulent applications - and here's the part that matters for King County residents - she specifically targeted the U.S. Department of Treasury's Emergency Rental Assistance Program funds administered by King County. Not just generic PPP fraud. King County funds. She enlisted more then 50 associates. They obtained more than $3.3 million by posing as fake tenants, landlords, and small business owners. She spent the money on luxury cars, cosmetic surgery, jewelry, designer goods.
U.S. Attorney Tessa Gorman announced her sentence in March 2024. Five years federal prison. The Western District of Washington is not showing leniency.
What The Numbers Mean For You
According to Pandemic Oversight, as of December 31, 2024:
- 3,096 defendants have been charged with pandemic relief fraud
- 2,532 defendants have been found guilty (82%)
- 1,741 received prison time (81% of those convicted)
- Sentences ranged from 1 day to 30 years
- Over $882 million in restitution has been ordered
81% of convicted defendants got prison time. Not fines. Not probation. Prison.
Your probably thinking the numbers are skewed by the big cases. The multimillion dollar schemes. The obvious fraudsters. Your probably telling yourself that your situation is different.
Consider the Western District of Washington cases.
Mukund Mohan lived in Clyde Hill. Not some random fraudster - he was a tech executive. Former director of product management at Amazon Business. Former director of Microsoft Ventures. He submitted 8 fraudulent applications seeking $5.5 million, obtained nearly $1.8 million. His sentence: 2 years federal prison, plus $100,000 fine and $1.78 million restitution.
Eric Shibley was a Seattle doctor. He submitted 26 fraudulent PPP applications and 13 EIDL applications seeking over $3.5 million. He went to trial. The jury convicted him of 7 counts wire fraud, 3 counts bank fraud, 5 counts money laundering. The judge called his testimony "one of the worst performances of a criminal defendant." His sentence: 4 years federal prison.
Professional status doesn't protect you. Amount doesn't protect you.
The median time from initial referral to indictment has decreased by 45% compared to 2022-2023. What used to take 8-12 months now takes 4-6 months. The government has gotten faster. More efficient. More ruthless. Your loan from 2020 isn't getting safer as time passes. Its getting closer to prosecution.
How One Application Becomes Five Federal Charges
The PPP itself doesn't have criminal provisions. The CARES Act isn't a penal statute. So how are people going to federal prison?
The DOJ uses pre-existing fraud statutes to prosecute PPP fraud. One application can trigger multiple charges:
- 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 that level - but charge stacking gives prosecutors enormous leverage in plea negotiations.
Look at Eric Shibley again. One person. Seven counts wire fraud. Three counts bank fraud. Five counts money laundering. Fifteen separate charges from essentialy the same conduct. Thats how federal prosecutors operate. They dont charge you with one crime. They stack charges to maximize pressure.
And that pressure works. 82% of defendants plead guilty. Only 117 defendants out of 2,532 convictions went to trial. When your facing 15 charges with 100+ years theoretical exposure, the 5-year plea deal suddenly looks attractive.
What To Do Right Now
Theres something most people dont know about PPP investigations.
A window exists - typically six to twelve months - between when the SBA OIG flags a loan and when the case gets referred to the FBI for criminal investigation. During this window, there is leverage that completley disappears once criminal charges are filed.
During the OIG review stage, a skilled defense attorney may be able to negotiate a civil disposition. Repayment plus a fine. Maybe a False Claims Act settlement. Not pleasant, but not a federal felony conviction either.
This window closes completely once criminal charges are filed.
But most people make critical mistakes before they even know the window exists.
The first mistake is talking to investigators without counsel. There have been several recent cases where people who decided to talk to investigators ended up being charged with obstruction or making false statements to federal agents - in addition to the underlying PPP fraud. The agents seem friendly. Cooperative. There not on your side. Every word you say is being recorded and analyzed for inconsistencies.
The second mistake is voluntary repayment without legal guidance. The DOJ has explicitly stated that voluntary repayment can be used as evidence of consciousness of guilt. Returning the money dosent make it go away - it can actualy strengthen the government's case against you. The timing and structure of any repayment matters enormously.
If you're under investigation or concerned you might be:
- Don't destroy any documents. Document destruction can become a separate 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 backfire badly.
- Contact a federal defense attorney immediately. The earlier you act, the more options exist.
Todd Spodek has handled federal fraud cases and understands the difference between OIG-stage investigations where civil resolution may be possible, and FBI-stage investigations where criminal defense is the priority.
When Your Ready
If you're in King County - or anywhere in the Western District of Washington - and you're facing a PPP loan fraud investigation, Spodek Law Group can help you understand where 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 where 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 the Western District of Washington?
Call us at 212-300-5196. The statute of limitations runs until 2030 or 2031 depending on when you got the loan. The government has time. But once they move, things happen fast - 45% faster then they used to. 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.
