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DOJ Investigates PPP Loan Fraud – How to Defend Your Business

The Paycheck Protection Program was introduced into law in 2020 to assist businesses facing hardship due to the COVID-19 pandemic. Unfortunately, there are reports of fraud related to the program that has garnered attention from the US Department of Justice (DOJ). Businesses and individuals who misuse PPP funds, fail to provide accurate information, or violate lending guidelines are now under DOJ investigation. If you’re among those facing potential criminal charges resulting from such an inquiry, here is what you need to know.

The DOJ Means Business
You must realize that the DOJ is uncompromising in its pursuit of PPP loan fraud suspects. If convicted, stiff penalties apply, including colossal fines and lengthy prison terms. To have the chance of minimizing any potential sentences or fines, secure expert counsel immediately.

Active Pursuit of PPP Charges
Numerous cases already exist where people face charges for many different types of violations. Some examples include abusing PPP funds for personal indulgences, providing false certification on loan applications, or surreptitiously requesting multiple loans. There are sure to be more cases as the DOJ increases its efforts further in this area.

Working With Other Enforcement Agencies
To carry out effective investigations into possible fraudulent activity involving PPP loans, federal agencies work together so that no angle goes unnoticed. These include Partnerships with The Small Business Administration Office of Inspector General, Federal Deposit Insurance Corporation Office of Inspector General, Federal Bureau of Investigation and Internal Revenue Service Criminal Investigations team.

Potential Defense Strategies For Fighting DOJ Investigations
Suppose you’ve come under scrutiny by prosecutors probing business-linked breaches regarding a Paycheck Protection Program Loan application-like most defendants in your position; your top priority must be proving compliance with all relevant regulations for defending yourself against allegations like these at trial or sentencing hearings.
Here are some available defense strategies:
Paycheck Protection Program Compliance – Offering evidence that outlines full compliance with PPP guidelines may help dismiss accusations of loan fraud. Examples of evidence include proof of a segregated account for PPP funding, the use of funds that adhere to PPP rules, and legal receipt of the loan.

Lack Of Intent To Defraud – Cases involving unintentional errors or oversights that lead to fraudulent activity can benefit from defending the lack of intent to defraud. It is critical to note that civil offenses are possible even though there was no intention behind the fraud.

Possible Criminal Charges Associated With PPP Fraud
The United States Department of Justice has several federal statutes that they can apply to prosecute PPP loan fraud violators. These include, but are not limited to:
1) False Statements to an FDIC-Insured Bank or Small Business Administration (SBA)
2) Wire Fraud – Defining fraud schemes conducted over telecommunication networks.
3) On-scale Identity Theft – prohibits anyone from utilizing another’s identification under false pretenses.
4) Tax Evasion – Aiding individuals in evading tax responsibilities is an offense.
5) Making False Statements To Federal Agents – making statements intended to provide false information or intentionally misleading federal investigators during a PPP loan inquiry.
6) Conspiracy – Federal law criminalizes involved parties attempting to conspiring against federal acquisitions obtained through fraudulent means under covering a PPP loan scheme.
7) Crash & Burn Attempt Shield Law- penalizes those convicted on grounds before any significant harm results from their fraudulent activities,
8) False Claims Act Violations – Pursuing civil charges in cases involving submitting incorrect information while claiming funds from government programs

Conclusion
If you’re being targeted for DOJ inquiries regarding potential PPP loan violations or other criminal allegations, it is critical that you work towards securing effective legal representation with experience defending this type of case. Attorneys who specialize in dealing with these concerns have an excellent track record defending clients who face similar charges and can advise you how prepare strategies specific for your case concerning better protection for your rights and interests. Therefore, contact a reputable attorney at Todd Spodek Law Group today for a consultation on how to face PPP loan fraud arrests.