New York County PPP Loan Fraud Lawyers
You got a PPP loan in 2020. Maybe 2021. Everyone did - the government was practically throwing money at businesses during the pandemic. You filled out the application, got approved, used the funds. Years passed. You figured the whole thing was behind you. Moved on. Assumed the government had moved on too.
It hasn't.
The federal government turned PPP loan fraud prosecution into an assembly line - and New York County sits in the heart of SDNY, the most aggressive federal district in the country. The same prosecutors who take down billion-dollar hedge fund managers are now applying that expertise to PPP fraud. Congress extended the statute of limitations to 10 years. That 2020 loan you thought was forgotten? Prosecutable until 2030.
Welcome to Spodek Law Group. We handle federal PPP loan fraud defense in New York County and throughout the Southern 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 shown up at your door - this article explains exactly what you're facing and what options still exist.
The 10-Year Clock Is Running on Your 2020 Loan
In August 2022, Congress passed 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 - 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 designated PPP fraud as a top enforcement priority. The COVID-19 Fraud Enforcement Task Force coordinates across FBI, IRS Criminal Investigation, SBA OIG, Secret Service - they have dedicated strike forces for this. They've recieved more than 250,000 hotline complaints since the pandemic began. From those complaints, data analytics teams identified more than 95,000 actionable leads.
Every PPP loan ever issued is now subject to prosecution for a full decade from the date of the offense.
The SBA Office of Inspector General processes these complaints through a four-step system: automated screening, data analytics review, human examination of flagged files, then referral to criminal investigators. As of January 2023, they had 536 ongoing investigations. That number has grown. Your not off there radar just because years have passed - your on a list working its way through the system.
Where Wall Street Prosecutors Now Target PPP Fraud
The Southern District of New York covers Manhattan, the Bronx, and counties north of New York City. New York County - Manhattan - sits at the heart of this jurisdiction. This is the district that prosecutes the most sophisticated financial fraud cases in the country.
But here's what most people don't understand about SDNY.
The same prosecutors who chase billion-dollar hedge fund schemes, who take down Wall Street executives, who built cases against insider traders - those are the prosecutors now handling PPP fraud. SDNY has an 88% indictment rate. They use grand jury indictments even for cooperative defendants because SDNY juries are prosecution-friendly. There not prioritizing based on loan size. Their prioritizing based on evidence strength. Your PPP application - with your signature, your representations, your bank records - is pre-built evidence. They view it as a slam dunk.
Recent SDNY PPP fraud cases:
- Rafael Martinez (SDNY, 2024): CEO of PPP lender MBE Capital. Sentenced to 54 months for submitting fraudulent loan and lender applications.
- Sandeep Grover (Seaford, NY): Owner of Excellent Business Services tax preparation firm. Submitted more than 100 PPP applications with false representations, fraudulently obtaining over $13 million.
- Baltej Singh Brar (South Richmond Hill, NY, 2025): Tax preparer sentenced to 24 months. Advertised on TikTok. Falsely inflated income amounts and submitted fabricated IRS forms. $550,000 in actual losses.
- Recidivist Fraudster (SDNY, 2024): Sentenced to 25 years for a $10+ million PPP scheme - among the longest PPP-related sentences nationally.
All four of New York's federal districts are actively prosecuting PPP fraud. If your in New York County, your facing prosecution in the district thats handed out some of the harshest sentences in the country.
81% Get Prison - And Amount Doesn't Matter
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% conviction rate)
- 1,741 received prison time (81% of those convicted)
- 2,008 were ordered to pay restitution (94%)
- Investigation-to-indictment time has decreased by 45%
What used to take 8-12 months now takes 4-6 months. The government has gotten faster. More efficient. And sentences are getting longer - defendants sentenced in 2024-2025 are receiving sentences aproximately 40% longer than defendants who committed identical conduct but were sentenced in 2021-2022. Early pandemic leniency is completely over.
"Do people actualy go to prison for a $20,000 PPP loan?"
Yes.
A Cincinnati defendant got 18 months in federal prison for $21,000 in PPP fraud. March 2025. The amount doesn't protect you. Federal judges in 2025 include prison time in nearly every PPP sentencing regardless of amount. This isnt about proportionality. Its about deterrence. The government wants headlines.
And one application can trigger multiple 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 carries 20 years. Aggravated identity theft adds a mandatory 2 years consecutive. One PPP application can create theoretical exposure exceeding 100 years. In practice, sentences don't reach that level - but charge stacking gives prosecutors enormous leverage in plea negotiations.
The 6-12 Month Window Nobody Tells You About
Most people don't understand how PPP investigations actually work.
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 completely 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. The path from OIG review to FBI referral to indictment isn't automatic - there are decision points along the way.
But here's the trap most people fall into.
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 doesn't make it go away - it can actually strengthen the government's case against you.
And talking to investigators without counsel? There have been several recent cases where people who decided to talk 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.
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 SDNY think.
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 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 Southern District of New York. 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 you're in New York County - or anywhere in the Southern District - 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 SDNY?
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.
Were here when you need us.
