Utah PPP Loan Fraud Lawyers

You thought the PPP emergency ended in 2021. The prosecutions have just started. Congress extended the statute of limitations from five years to ten years in 2022 - after most loans were already disbursed. That means applications from April 2020 are prosecutable until April 2030. The Small Business Administration identified over $200 billion in potentially fraudulent loans, which is 17 percent of all PPP and EIDL funds. Federal COVID-19 Fraud Strike Forces are coordinating across Homeland Security Investigations, the FBI, the SBA Office of Inspector General, and the Treasury. And their conviction rate in COVID fraud cases is 97 to 98 percent.

What looked like emergency relief in 2020 is a wire fraud charge waiting to happen in 2025. At Spodek Law Group, we defend clients facing federal PPP loan fraud investigations and prosecutions in Utah and nationwide. Our team has handled high-stakes federal cases and understands the coordinated multi-agency approach prosecuters are using. Were based in New York but represent clients across the country, including Salt Lake City, Provo, Ogden, and throughout Utah. Call 212-300-5196 if you're facing a federal investigation or have concerns about a PPP or EIDL loan.

The emergency ended. The prosecutions are just beginning.

The 2020 Emergency That Runs Until 2030

PPP loans were marketed as thirty-day emergency relief. Congress removed normal banking fraud safegaurds to get money out fast during the pandemic. No collateral requirements. Minimal documentation. Self-certification of employee counts and payroll. The system was designed for speed, not security. And then in August 2022 - after the emergency ended - Congress passed the PPP and Bank Fraud Enforcement Harmonization Act, extending the statute of limitations from five years too ten years.

This wasn't prospective. It was retroactive. If you recieved a PPP loan in April 2020, the original five-year statute would of expired in April 2025. Under the new law, prosecutors have until April 2030. That extra five years transforms the entire risk calculation. Borrowers who thought they were safe because "nothing happened for three years" are discovering that federal investigators work on there own timeline. The SBA Office of Inspector General has publicly stated that PPP investigations will continue for more then a few years.

Three Utah residents were sentenced for PPP fraud in 2025 alone. Marcelo Federico Torre of Draper was sentenced in April 2025 after fraudulently obtaining $628,307 by claiming his company had 37 employees and an average monthly payroll of $251,323 when the company hadn't even existed as of February 15, 2020. Troy Campbell of Taylorsville was sentenced to 18 months imprisonment in June 2025 for obtaining $437,230 through fake tax documents that were never filed with the IRS. Halee Ann Mehlbauer of Tooele County received 15 months in prison for fraudulently obtaining approximately $177,030. These cases weren't from 2020 or 2021. The sentencing happened in 2025, four to five years after the loans were disbursed.

The ten-year statute means federal prosecutors can investigate loans from 2020 through 2030, loans from 2021 through 2031. Every application, every certification, every sworn statement about employee counts or payroll expenses remains prosecutable for a decade. And because PPP loan data is public - recipient names, loan amounts, reported employee counts are all searchable online - investigators don't need warrants or subpoenas to identify targets. You published the evidence against yourself when you submitted the application.

The emergency that took thirty days in 2020 created a prosecution window that lasts until 2030. Thats the paradox nobody mentions. The faster the relief, the longer the criminal exposure.

Why PPP Cases Have a 97% Conviction Rate

Federal prosecutors don't bring cases their uncertain about. The conviction rate for COVID-19 fraud cases handled by the IRS Criminal Investigation division is 98.5 percent. Across all federal fraud prosecutions, approximately 97 percent result in convictions. That number isn't because juries love the goverment. Its because prosecutors only indict cases there certain to win.

PPP cases are easier to prosecute then other fraud cases, and defense attorneys will tell you this privately. The loan data is public, so investigators can identify outliers without subpoenas. Self-certification means borrowers swore under penalty of perjury to employee counts and payroll figures that are easy too verify or disprove through IRS records, state unemployment filings, and bank statements. There's no complex financial instrument to explain, no ambiguous contract language, no regulatory grey area. You claimed 37 employees when you had zero. You reported a monthly payroll of $251,323 when your company didn't exist. The lie is clean and the evidence is documentary.

And here's were the program design becomes the trap. Congress deliberately removed normal banking safegaurds to disburse PPP funds fast. No collateral. Minimal verification. Streamlined approval process. The Government Accountability Office identified warning signs in 3.7 million out of 11.5 million PPP loan recipients, but the loans were approved anyway because speed was the priority. Then prosecutors criminally charge borrowers for exploiting the lack of safeguards Congress intentionally removed. The system created the fraud, then punishes the fraudsters.

The SBA estimates it disbursed over $200 billion in potentially fraudulent COVID-19 EIDL and PPP loans - roughly 17 percent of all funds distributed under those programs. Even if federal prosecutors charge 20,000 defendants, that's a tiny fraction of the flagged amount. The real statistic is this: they have unlimited targets and nine years remaining to prosecute. At least 2,393 defendants have been found guilty of fraud-related charges involving pandemic relief programs as of December 31, 2024, and 81 percent of convicted defendants received prison time.

When prosecutors have a 97 percent conviction rate, the question isn't whether you're guilty. The question is whether they've decided to prosecute. If you've been indicted, they've already made that decision. The trial is theater.

The Federal COVID-19 Fraud Strike Force You Don't See

When a federal agent knocks on your door - whether its Homeland Security Investigations, the FBI, the SBA Office of Inspector General, or IRS Criminal Investigation - you think your talking to one person. Your actually talking too five agencies building one file. The Federal COVID-19 Fraud Strike Force coordinates investigations across multiple agencies. HSI, FBI, SBA-OIG, Treasury, and the Justice Department share information, evidence, and investigative leads.

This matters because of how Americans misunderstand their Fifth Amendment rights. You have the right to remain silent. You should exercise it. But most people don't. They try to "explain" the situation, thinking cooperation will make the problem go away. What actually happens is you make statements that contradict your PPP application, and now your facing 18 USC 1001 charges - making false statements to federal agents - in addition to the original fraud charges. Troy Campbell tried to explain his situation and ended up with 18 months in federal prison.

The Strike Force file sharing means anything you say to one investigator becomes available to all of them. You tell an HSI agent you used PPP funds for payroll. The FBI pulls your bank records and discovers you wired $225,000 into your TD Ameritrade investment account. Treasury flags cryptocurrency purchases. SBA-OIG documents that you had no employees as of the application date. Your trying to cooperate with one person, but five agencies are building a wire fraud case with your own statements as evidence.

And because PPP loan data is public, investigators can run the entire initial investigation without any contact with you. They know how much you borrowed, how many employees you claimed, what your stated payroll was. They compare that public data to IRS filings, state unemployment records, and business registries. If the numbers don't match, they open a case. The investigation is running before you know your under scrutiny. By the time an agent contacts you, they've already built the foundation of a prosecution.

A Cottonwood Heights businessman wired $225,000 from his PPP loan directly into his TD Ameritrade investment account. That single wire transfer is a violation of 18 USC 1343 - wire fraud - which carries a maximum sentence of 30 years. The wire took thirty seconds. The criminal liability lasts ten years under the statute of limitations and up to 30 years as a maximum sentence. One transaction, three decades of exposure. Thats the consequence cascade nobody mentions when the money hits your account.

Don't talk to federal agents without an attorney present. Be polite. Take their card. Say you need too speak with a lawyer first. Then actually call a lawyer before you say anything else.

The Former Olympian Facing 6.5 Years (And You)

Allison Baver won a bronze medal in the 2010 Olympics. She competed in short-track speedskating in 2002, 2006, and 2010. In April 2020, she submitted eight fraudulent PPP loan applications for her company, Allison Baver Entertainment LLC. She claimed 430 employees when she had zero. She reported an average monthly payroll between $4,770,583 when the company had no payroll. She obtained $10 million from Meridian Bank. Then she transferred $150,000 in PPP funds to invest in a film called "No Man of God," a 2021 drama about Ted Bundy starring Elijah Wood. The Internet Movie Database lists Baver as one of the film's executive producers.

That $150,000 investment became the basis for a money laundering charge. Your name in the movie credits becomes your name in the indictment. A federal jury found Baver guilty of two counts of making false statements to influence a bank, one count of money laundering, and one count of contempt. Federal prosecutors recommended she be sentenced to 78 months in prison - that's 6.5 years - followed by five years of supervised release. The government also wants to seize over $9.5 million from her.

The sentencing was delayed because the judge ruled Baver's defense counsel may have been "not constitutionally effective." But here's the thing: the ineffective assistance finding doesn't undo the conviction. It doesn't eliminate prison time. It just delays sentencing. Baver is still convicted. She's still facing 6.5 years. Bad lawyering in federal court is a delay tactic, not a defense. The only thing the ineffective assistance claim does is give her a chance at a better sentence or retrial - which means facing the same 97 percent conviction rate a second time.

Allison Baver was a celebrated athlete who represented the United States in three Olympic Games. Bronze medal in 2010. Elite competitor. Federal prosecutors recommended 6.5 years anyway. The jury convicted her anyway. Olympic achievement bought her exactly zero leniency in PPP fraud court. If a former Olympian gets no mercy, your excuses won't work either.

The uncomfortable truth prosecutors won't say out loud: by the time your charged, they've already decided your guilty. The 97 percent conviction rate isn't an accident. They only bring cases there certain to win. Allison Baver went to trial. She lost. She's facing 6.5 years. Compare that too Giuseppe Mirenda, who cooperated with prosecutors and received 12 months for $1.9 million in PPP fraud. Cooperation cut his sentance by more then 80 percent.

The choice isn't between guilt and innocence. Its between 12 months if you cooperate and 6.5 years if you fight. Admitting guilt reduces your sentance. Fighting for innocence multiplies your prison time. Thats the paradox federal defendants face: the safety of guilt versus the danger of fighting.

The Utah Residents Sentenced in 2025

Three separate Utah residents received federal sentences for PPP fraud in 2025, proving that prosecutions aren't winding down - there ramping up.

Marcelo Federico Torre of Draper pled guilty to wire fraud after fraudulently obtaining $628,307 by claiming his company had 37 employees and a monthly payroll of $251,323 when the company hadn't existed as of February 15, 2020. Sentenced April 2025: three years supervised release, full restitution.

Troy Campbell of Taylorsville got 18 months imprisonment for obtaining $437,230 through his company Salt IT Solutions LLC. His application claimed 22 employees and a monthly payroll of $174,892.17. He submitted fake tax documents never filed with the IRS. Sentenced June 2025.

Halee Ann Mehlbauer of Tooele County received 15 months in prison for fraudulently obtaining $177,030. She was part of a larger fraud ring involving at least 10 fraudulent applications attempting to defraud the SBA of approximately $422,242.50.

These aren't historical cases. These are 2025 prosecutions - four to five years after the loans were disbursed. The U.S. Attorney's Office for the District of Utah continues filing new PPP fraud indictments.

And here's what defense attorneys know: even if your PPP loan was forgiven, you're not safe. Loan forgiveness is civil. Criminal prosecution is separate. The forgiveness certification can become Exhibit A in a wire fraud trial. You certified under penalty of perjury that you used funds correctly. Then prosecutors use that sworn certification as evidence that you committed fraud.

Forgiveness makes people feel safe. It shouldn't.

The $177,000 Case That Got 15 Months

Public perception is that the government only prosecutes large fraud cases - the $10 million schemes, the organized fraud rings. Halee Ann Mehlbauer destroys that belief. She fraudulently obtained approximately $177,030 and received 15 months in federal prison. Troy Campbell got $437,230 and received 18 months. These aren't million-dollar cases. There six-figure cases, and they resulted in real prison time.

The inversion here is critical: small fraud, real prison. Defense attorneys see this pattern and adjust there strategy accordingly. If your facing charges for a few hundred thousand dollars, you can't rely on prosecutorial discretion too let you slide. The Strike Force is prosecuting cases at every level. Prison time starts at six figures, not seven.

This destroys the "wait and see" approach some borrowers are taking. The thinking goes: if the government was going to investigate me, they would of done it by now. But the statute runs until 2030. Investigators have unlimited time. And because PPP data is public, they can identify targets years after disbursement. Torre's loan was from April-May 2021. He wasn't sentenced until April 2025 - four years later. Campbell's fraud ran from July 2020 to February 2023. He was sentenced in June 2025. The gap between the fraud and the prosecution can be half a decade.

Small business owners who inflated employee counts by five or ten workers, who exaggerated payroll by $50,000 or $100,000, believe there case isn't worth federal attention. The 2025 Utah prosecutions prove otherwise. If you fraudulently obtained $177,030, your facing 15 months. If you obtained $437,230, your facing 18 months. The cases aren't too small. Your just not important enough to skip.

And heres the consequence chain nobody walks through: you receive a target letter or a federal agent contacts you. You think you can "explain" the situation - maybe it was a mistake, maybe the accountant made an error, maybe the rules were confusing. So you talk. You make statements. Those statements contradict your application. Now your facing 18 USC 1001 (false statements to federal agents) in addition to the original fraud charges. Cooperation credit destroyed. Plea leverage gone. Sentance exposure increased.

The correct response is: be polite, take the agents card, say you need to speak with a lawyer, then actually call a federal defense attorney before you say anything else. That simple process - shutting up and calling a lawyer - is the difference between having options and having none.

12 Months If You Cooperate, 6.5 Years If You Fight

Giuseppe Mirenda received 12 months for $1.9 million in PPP fraud because he cooperated with prosecutors. Allison Baver is facing 6.5+ years for $10 million because she went to trial. The ratio between those sentences isn't proportional to the fraud amount. Mirenda's fraud was 19 percent of Baver's, but his sentance is less then 16 percent of hers. The difference isn't the crime. Its the cooperation.

In nine out of every ten federal prosecutions, defendants resolve the case through a plea agreement. Close to 97 percent overall result in convictions. The "defense" in most federal fraud cases isn't proving innocence - it's cooperating early enough to minimize the sentence. Prosecutors overcharge to create plea leverage. They stack charges - wire fraud, bank fraud, money laundering, false statements - knowing that the cumulative maximum sentance is absurd. Then they offer a plea: cooperate, allocute, accept responsibility, and we'll recommend a fraction of the exposure.

If you refuse and go to trial, your facing the stacked charges with a 97 percent likelihood of conviction. Judges sentence defendants who go to trial more harshly than defendants who plead guilty, because defendants who plead guilty receive a reduction for "acceptance of responsibility" under the federal sentencing guidelines. You lose that reduction if you go to trial. So even if you somehow win at trial - a three percent chance - the sentancing exposure for losing is catastrophic.

Allison Baver's case illustrates another trap: ineffective assistance of counsel. The judge found her defense attorneys may not have been "constitutionally effective." That sounds like grounds for relief. It isn't. Baver is still convicted. She's still facing 6.5 years. The ineffective assistance finding just delays sentancing and potentially gives her a shot at retrial - which means going through the same process again, facing the same 97 percent conviction rate. Bad lawyering doesn't undo guilt. It just prolongs the nightmare.

The only real defense in PPP fraud cases is early cooperation. Contact a federal defense attorney before you talk to investigators. Let the attorney reach out to prosecutors, explain the situation, provide context the government might not have. In many cases, experienced attorneys can help clients avoid criminal charges altogether by presenting mitigating evidence early - before an indictment. Once your indicted, the leverage shifts. Prosecutors have already decided to charge you. The case outcome is largely predetermined. The only question is the sentance.

Cooperation means: acknowledge what happened, explain why, provide documentation, demonstrate that the fraud wasn't part of a broader scheme, show that your not a ongoing threat. Prosecutors want easy wins. If you give them one - a guilty plea, allocution, restitution agreement - they'll recommend a sentance on the lower end of the guideline range. If you fight, they'll ask for the maximum.

The paradox is this: admitting guilt is safer then fighting for innocence. The system punishes defendants who excercise there trial rights. The sentence reduction for pleading guilty is so significant that going to trial becomes irrational, even if you believe your innocent. Its not justice. Its math. 12 months versus 6.5 years. The choice is clear, even if its grotesque.

What to Do If You're Facing a PPP Fraud Investigation in Utah

If you're under investigation, if you've received a target letter, or if a federal agent has contacted you, speak with a federal criminal defense attorney before you say anything else. Don't try to "explain" your situation to investigators. The statute of limitations runs until 2030 for loans disbursed in 2020, and prosecutors are actively filing new cases in 2025.

At Spodek Law Group, we represent clients nationwide facing federal PPP fraud investigations and prosecutions. Our team understands how the Federal COVID-19 Fraud Strike Force operates. We know the multi-agency coordination between HSI, FBI, SBA-OIG, and Treasury. And we know how to negotiate with federal prosecutors from a position of strength, presenting mitigating evidence early to avoid charges or minimize sentencing exposure.

Were based in New York City but represent clients throughout Utah, including Salt Lake City, Provo, Ogden, and statewide. Call 212-300-5196 for a confidential consultation. Time matters in federal investigations. The earlier you involve experienced counsel, the more options you have.

Todd Spodek founded Spodek Law Group with a mission: provide clients facing serious federal charges with representation that understands the stakes. Were not a high-volume practice. We focus on complex, high-stakes federal cases were the exposure is measured in years, not months.

The Federal COVID-19 Fraud Strike Force is still actively investigating. The SBA identified $200 billion in potentially fraudulent loans - thats enough targets to sustain prosecutions for the next decade. If your one of those targets, call 212-300-5196. Were here to help.