Kings County PPP Loan Fraud Lawyers
You got a PPP loan during the pandemic. Maybe 2020. Maybe 2021. Brooklyn businesses everywhere were doing the same thing - the government was practically shoving money at anyone who could fill out an application. You got approved, used the funds, maybe even got forgiveness. Years went by. You moved on with your life. You assumed the federal government had moved on too.
The federal government disagrees.
They turned PPP loan fraud prosecution into an assembly line - and Kings County is directly in the crosshairs. The Eastern District of New York has jurisdiction over Brooklyn, and prosecutors there are handing out sentences 40% longer than they were two years ago for identical conduct. Congress extended the statute of limitations to 10 years. That 2020 loan you forgot about? It's prosecutable until 2030. The window between the SBA flagging your file and the FBI showing up is shrinking. And right now, in Brooklyn, people are going to federal prison for PPP loans.
Welcome to Spodek Law Group. We handle federal PPP loan fraud defense in Kings County and throughout the Eastern District of New York. If you're under investigation, if you've received a letter from the SBA Office of Inspector General, or if federal agents have already contacted you - this article explains what you're actually facing and what options might still exist.
The Government Never Forgot
In August 2022, President Biden signed something most people completley missed. The PPP and Bank Fraud Enforcement Harmonization Act. Buried in the text was a single provision that changed everything.
It extended the statute of limitations from 5 years to 10 years. Retroactively.
A PPP loan from 2020 is now prosecutable until 2030. A loan from 2021 until 2031. The government gave itself a full decade to come for you. And there using every minute of it.
The numbers are stark. According to Pandemic Oversight, as of December 31, 2024:
- 3,096 defendants have been charged with pandemic relief fraud
- 2,532 have been found guilty (82%)
- 1,741 recieved prison time (81% of those convicted)
- 2,008 were ordered to pay restitution (94%)
- Sentences ranged from 1 day to 30 years, with the majority between 1-5 years
The IRS Criminal Investigation division has launched 2,039 COVID fraud investigations totaling $10 billion in attempted fraud. There conviction rate? 97.4%. Thats not a typo.
And heres what makes it worse. Defendants sentenced in 2024-2025 are recieving sentences approximately 40% longer than defendants who committed identical conduct but were sentenced in 2021-2022. The era of leniency is completley over. Federal judges in 2025 include prison time in nearly every PPP fraud sentencing - regardless of the amount involved.
This isnt hypothetical. This is happening in Brooklyn right now.
Brooklyn Cases That Should Worry You
The Eastern District of New York covers Brooklyn, Queens, Staten Island, and all of Long Island. Kings County residents face prosecution in one of the busiest federal districts in the country for white-collar crime.
Recent Brooklyn/Kings County PPP fraud cases:
- Leon Miles (Brooklyn, November 2024): Sentenced to 72 months - six years in federal prison - for $1.9 million in PPP fraud. The government seized his 2020 Bentley. He owes $598,299.39 in restitution. He had claimed his Brooklyn company had 50 employees and $761,838 in monthly payroll. It didnt.
- Khaled Salem (Brooklyn, July 2025): Indicted for stealing over $104,000 in PPP funds through a nonprofit called American Human Rights, Inc. Listed employees who never worked there. Also charged seperately with voter petition fraud.
- Six Family Members (Brooklyn, November 2025): Six people from the same family indicted for a $166,000 PPP conspiracy involving fictitious businesses. Two also charged with pandemic unemployment fraud.
72 months. Six years in federal prison. For a PPP loan.
U.S. Attorney Breon Peace stated: "Abuse of public benefits programs, particularly shameful when those defrauding the government are public servants, will not be tolerated and not forgotten with the passage of time from the darkest days of the COVID-19 pandemic."
The government is not forgetting.
And one application can trigger multiple federal charges. Wire fraud under 18 U.S.C. § 1343 carries 20-30 years. Bank fraud under 18 U.S.C. § 1344 carries 30 years. False statements to the SBA under 18 U.S.C. § 1014 carries 30 years. Money laundering adds another 20 years. If you used someone elses information, aggravated identity theft adds a mandatory 2 years consecutive.
One PPP application. Five potential federal charges. Theoretical exposure exceeding 100 years.
But heres what most people dont understand about how these cases actualy develop.
The Window Most People Miss
Theres a window. Typically six to twelve months. Between when the SBA Office of Inspector General flags your loan and when the case gets referred to the FBI for criminal investigation.
During this window, theres leverage that completley disappears once criminal charges are filed.
At 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. Its not pleasant, but its not a federal felony conviction either. Your not looking at prison. Your not looking at a lifetime of explaining your criminal record.
But heres the trap that destroys people.
Some people, panicking, decide to voluntarily repay the loan thinking it will make the problem disappear. The DOJ has explicitly stated that voluntary repayment can be used as evidence of consciousness of guilt. Returning the money doesnt make the problem go away - it can actualy strengthen the governments case against you.
Read that carefully.
Paying back the money can make things worse.
This is complicated. The timing matters enormously. Whether to repay, when to repay, how to structure any resolution - these decisions require counsel who understands how federal prosecutors in EDNY actualy think.
So what should you do?
Getting Help Before Its Too Late
The single most important rule:
Never agree to discuss a potential PPP fraud case with a federal agent without a lawyer present.
This sounds obvious. But there have been several recent cases where people who decided to talk to investigators without counsel 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. They're not on your side.
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 have been 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.
- Contact a federal defense attorney immediately. The earlier you act, the more options exist.
Todd Spodek has handled PPP fraud cases in the Eastern District of New York. He understands the difference between OIG-stage investigations where civil resolution may still be possible, and FBI-stage investigations where criminal defense is the priority.
If you're in Kings County - or anywhere in Brooklyn - and you're facing a PPP loan fraud investigation, Spodek Law Group can help you understand where you stand and what options remain.
The consultation is free. There's no obligation.
What you'll get is an honest assessment. Is this still at the OIG stage where civil resolution might work? Has it already 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 EDNY?
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. The earlier you have counsel, the more leverage exists.
Don't wait until federal agents show up at your door.
We're here when you need us.
