Los Angeles County PPP Loan Fraud Lawyers
You got a PPP loan in 2020. Maybe 2021. The pandemic was chaos, the government was practically begging businesses to take money, and everyone you knew was applying. You filled out the paperwork, got approved, used the funds. Maybe you got forgiveness. Years passed. You moved on with your life. You assumed the federal government had moved on too.
It hasn't.
The federal government turned PPP loan fraud prosecution into an assembly line - and Los Angeles County is strike force headquarters. The Central District of California runs one of only THREE national COVID-19 Fraud Strike Force teams, coordinating multi-state prosecutions across the entire country. They're handing out sentences 40% longer than two years ago for identical conduct. Congress extended the statute of limitations to 10 years. 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 Los Angeles County and throughout the Central District of California. If you're under investigation, if you've received a letter from the SBA Office of Inspector General, if federal agents have contacted you - this article explains exactly what you're facing and what options still exist.
The 10-Year Clock Congress Started In 2022
In August 2022, President Biden signed the PPP and Bank Fraud Enforcement Harmonization Act. Most people missed what it actualy did.
It extended the statute of limitations from 5 years to 10 years - and it applied retroactively. That means a PPP loan from 2020 is prosecutable until 2030. A loan from 2021 until 2031. And if you filed a forgiveness application in 2022? The clock may have reset to 2032.
Every PPP loan ever issued is now subject to prosecution for a full decade from the date of the offense.
The government gave itself a decade to come for you. And there using every day of it. As of December 2024, the Department of Justice continues to investigate PPP fraud as a top enforcement priority. The COVID-19 Fraud Enforcement Task Force coordinates across FBI, IRS Criminal Investigation, SBA OIG, Secret Service, and other agencies. They have dedicated strike forces for this. They are not winding down.
Los Angeles Is Strike Force Headquarters
Most people assume that LA is just one of many cities dealing with PPP fraud prosecutions. Federal districts everywhere are handling these cases, right? Los Angeles is big, sure, but its just one piece of a national enforcement effort.
Wrong.
On September 15, 2022, the Attorney General selected the U.S. Attorney's Offices for the Central and Eastern Districts of California to jointly head one of only THREE national COVID-19 Fraud Strike Force Teams in the entire country.
What that means for you: Los Angeles prosecutors aren't just handling local cases. There coordinating multi-state prosecutions across the country. There the elite team. Best resourced. Most experienced. Most aggressive. The Strike Force combines FBI, IRS Criminal Investigation, SBA OIG, Secret Service, and other agencies into prosecutor-led teams that focus on large-scale pandemic fraud.
If your in LA County, your not facing some local U.S. Attorney's office thats still learning how PPP cases work. Your facing the team that trains everyone else.
What LA County Defendants Are Actually Getting
Heres the reality of PPP fraud sentencing in the Central District of California.
Recent LA County/CDCA cases:
- Robert Benlevi (Encino): 135 months - thats 11 years and 3 months - for a $27 million PPP scheme involving 27 applications and 8 fake companies. He claimed each company had 100 employees. None of them had any employees. He spent the money on a Santa Monica oceanfront apartment and personal expenses.
- Jasmine Mallard-McCarter (Eastvale): 84 months - 7 full years in federal prison - for advertising PPP fraud services on Instagram and obtaining $1.7 million. She recruited over 100 co-schemers.
- Casie Hynes (Los Angeles): 60 months - 5 years - for submitting more then 80 fraudulent applications for 20 fake companies, causing $3.2 million in losses.
- May 2025 arrests: 14 defendants arrested for allegedly obtaining over $25 million through fraudulent PPP, EIDL, and other federal program applications.
These aren't just numbers. These are your neighbors.
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 - thats 82%. Of those convicted, 1,741 recieved prison time - 81%. IRS Criminal Investigation reports a 97.4% conviction rate in prosecuted COVID fraud cases.
The sentencing cliff is real. Defendants sentenced in 2024-2025 are recieving sentences aproximately 40% longer than defendants sentenced in 2021-2022 for identical conduct. Federal judges in California have lost patience. The economic desperation of 2020 is no longer an excuse anyone accepts.
And the charge stacking makes it worse. Wire fraud carries 20-30 years. Bank fraud carries 30 years. False statements to the SBA carries 30 years. Money laundering carries 20 years. Aggravated identity theft adds a mandatory 2 years consecutive. One PPP application can trigger five seperate federal charges with theoretical exposure exceeding 100 years.
The Window Before Criminal Referral
If your reading this and your stomach just dropped, heres what most people dont understand about PPP investigations.
There's a window - 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. Its not pleasant, but its not a federal felony conviction either. No prison. No criminal record.
But heres the trap. Two traps actually.
Trap one: Some people, panicking, decide to voluntarily repay the loan thinking it will make the problem go away. The DOJ has explicitly stated that voluntary repayment can be used as evidence of consciousness of guilt. Returning the money dosent make it disappear - it can actualy strengthen the government's case against you.
Trap two: There have been several recent cases where people who decided to talk to investigators without a lawyer 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. Their not on your side.
This is complicated. Whether to repay, when to repay, whether to respond to OIG inquiries, how to structure any resolution - these decisions require counsel who understands how federal prosecutors in the Central District think.
Todd Spodek has handled PPP fraud cases in federal courts. He understands the difference between OIG-stage investigations where civil resolution may still be possible, and FBI-stage investigations where criminal defense becomes the priority.
When Your Ready
If you're in Los Angeles County - or anywhere in the Central District of California - and you're facing a PPP loan fraud investigation, Spodek Law Group can help you understand where you stand and what options still 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 work? 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 CDCA?
Call us at 888-997-4071. The statute of limitations runs until 2030 or later depending on when you got the loan. The government has time. But once they move, things accelerate quickly. 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.
