In a desperate effort to stabilize the U.S. economy in the wake of the Covid-19 pandemic, the government established the Paycheck Protection Program. The PPP offered a series of forgivable loans to small businesses to ensure employees got paid during the crisis.
Many small businesses applied to get their share of the roughly $800 billion in government funds. However, after the dust settled from the initial cash grab, government audits have sparked several investigations accusing companies of falsifying their applications to get funding.
The government takes these cases seriously, and they have gone so far as to initiate a task force solely to crack down on suspected fraudsters. They’ve already prosecuted thousands and seized billions in stolen funds in just a few years. Without legal help from a fraud attorney, you could face federal charges for defrauding the government. Call Worgul, Sarna & Ness Criminal Defense Attorneys, LLC today at (412) 281-2146.
How a PPP Fraud Lawyer Can Help You
Our PPP loan fraud attorneys have defended clients in court for a decade. We believe that attorneys and their clients should work together to ensure the best possible outcome.
That means we’ll never try to convince you to settle if you want to go to trial. We’re comfortable in the courtroom and have the experience needed to get the job done.
Here’s how we’ll make a difference in your case:
- We’ll walk you through the criminal justice system and explain your rights
- We’ll negotiate with the prosecution to dismiss any unlawfully obtained evidence before trial
- We’ll gather evidence to strengthen your case against the prosecution
- We’ll use our knowledge of State and Federal laws to defend you at trial
What Could Cause a PPP Fraud Investigation?
PPP loan applications require specific information regarding your business. An error could result in you getting more money than you should have, which could spark a federal investigation of your business.
You might have made one or more of the following errors:
- Inaccurately recording the number of full-time employees
- Misclassifying employees as independent contractors
- Miscalculating payroll expenses
- Using funds for purposes other than covering business expenses
What if Errors Were Made in Good Faith?
One minor error could result in the government charging you with a federal offense. You might have made a simple mistake or misjudged your business’s needs in good faith. All applicants are required to make a reasonable, good-faith determination of need.
Additionally, they should consider their ability to access other options to support their business. Lastly, companies should keep records that support their determination of need. These records could come in handy if your business becomes the target of an investigation.
What to Do if You’re Under Investigation for PPP Fraud
If you find yourself on the wrong end of a federal investigation, you should tread carefully to protect your rights.
Make sure you do the following when federal authorities suspect PPP loan fraud:
- Exercise your right to remain silent. Respectfully decline to answer questions, and don’t make a formal statement before contacting a lawyer. Otherwise, you might incriminate yourself.
- Contact a PPP loan fraud lawyer. You have a right to an attorney. Take advantage of this so they can protect your rights.
- Provide Your Attorney with Paperwork. Give your attorney the PPP loan application and other documents detailing your business expenses so they can begin building your case.
- Gather Accounting Information. Showing you made legitimate purchases with your PPP loan to sustain your business could help your case.
What Charges & Penalties Could You Face for PPP Fraud?
Since PPP loan fraud involves the U.S. government, you will be charged at the federal level. Your alleged role in the crime and how you supposedly carried out the offense ultimately determine your charges.
You could face the following charges for PPP loan fraud:
- Bank Fraud – Under 18 U.S. Code § 1344, this involves knowingly executing or attempting to execute a scheme to defraud a financial institution, which could result in up to 30 years in prison and fines up to $1,000,000
- Wire Fraud – Under 18 U.S. Code § 1343, it’s illegal to obtain funds on false pretenses by means of a communication device. This results in up to 20 years in prison with accompanying fines. You face 30 years and $1,000,000 in fines when the violation impacts a financial institution
- False Statements – Under 18 U.S. Code § 1014, this involves knowingly falsifying information for a financial institution, which results in up to 30 years in prison and up to $1,000,000 in fines.
- Conspiracy to Defraud the U.S. Government – 18 U.S. Code § 371 makes it illegal for two or more people to conspire together to commit fraud against the government. This results in up to five years in prison with accompanying fines.
How Has the Government Responded to PPP Loan Fraud?
The U.S. government has gone to great lengths to clamp down on PPP loan fraud. To stop fraudsters, the Attorney General created the Covid-19 Fraud Enforcement Task Force consisting of several government agencies such as the FBI, the Department of Justice Office of Inspector General, the Small Business Administration, and more.
These agencies have combined their resources to audit and investigate businesses suspected of fraud. The Department of Justice regularly makes a press release announcing its progress, and as of March 10th, 2022, the DOJ reported having prosecuted over 1,000 defendants with alleged losses exceeding $1.1 billion.
Call a PPP Loan Fraud Attorney Today
Federal charges for PPP loan fraud are extensive, and your life could forever change if you’re convicted. Don’t incriminate yourself during a government investigation. Exercise your right to remain silent and contact a PPP loan fraud attorney at Worgul, Sarna & Ness, Criminal Defense Attorneys, LLC immediately.