CALIFORNIA CRIMINAL LAWYERS

Wyoming PPP and EIDL Loan Fraud Lawyers

What to Do If Your Business Is Being Investigated by the DOJ for PPP Loan Fraud

The COVID-19 pandemic has caused a massive impact on businesses throughout the United States. To keep their doors open and ensure their employees get paid, many businesses have turned to the Paycheck Protection Program (PPP), a forgivable loan program designed to provide federal assistance to struggling companies. However, allegations of PPP loan fraud have been widespread, with many businesses and individuals accused of fraudulently obtaining and misusing PPP funds. If you are facing a Department of Justice (DOJ) investigation for PPP loan fraud, there are steps you can take to mitigate your risk and protect your business.

DOJ’s Position on PPP Loan Fraud

The DOJ has taken a tough stance against alleged PPP loan fraud. Across the country, companies and individuals have been indicted under a range of statutes. According to a DOJ press release issued earlier this year, “The Paycheck Protection Program was designed to help Americans struggling with financial hardship during the pandemic. Our office will be aggressive in targeting anyone who defrauds this critical program.” Therefore, it is critical to take any allegations against your business seriously.

Options When Facing a PPP Loan Fraud Investigation by the DOJ

The first step to take if your business is being targeted in a DOJ PPP loan fraud investigation is to contact an experienced PPP loan fraud defense attorney. These attorneys can:

– Work to identify the specific allegations against your business
– Provide legal advice to help you navigate the DOJ’s investigation
– Help you to decide on the most effective defense strategy

Defenses for PPP Loan Fraud

There are several potential defenses that businesses accused of PPP loan fraud can assert in court. These include:

1. PPP Loan Compliance

The simplest defense is to demonstrate that your business has complied with the requirements of the PPP loan program. This includes obtaining a PPP loan, using a separate bank account to track PPP loan funds, and documenting your use of these funds. Demonstrate compliance with these requirements can lead to a quick resolution of allegations of PPP loan fraud.

2. Lack of Intent

It’s necessary to note that federal criminal statutes for fraud typically require intent to defraud. Accidentally obtaining a PPP loan despite being ineligible or using PPP loan funds for ineligible expenses may be sufficient to establish your lack of fraud conviction. However, lack of intent is not always enough to protect your business from a criminal investigation or civil enforcement action.

Federal Statutes for PPP Loan Fraud Investigations

The DOJ has already charged numerous individuals and companies with federal offenses related to PPP loan fraud, including but not limited to:

– FBI-IPA Investigations
РConspiracy Charges Under 18 U.S.C. § 371 and 18 U.S.C. § 1349
РFalse Statements to the Small Business Administration (SBA) (18 U.S.C. § 1014)
РWire Fraud (18 U.S.C. § 1343)
РBank Fraud (18 U.S.C. § 1344)

However, it is possible that more charges may be forthcoming as the DOJ continues to investigate allegations of PPP loan fraud.

What You Need to Do If You’re Facing a DOJ Investigation into PPP Loan Fraud

If your business is under investigation by the DOJ for PPP loan fraud, several steps can help mitigate your risk:

1. Contact an Experienced PPP Loan Fraud Defense Attorney

It is important to work with an experienced PPP loan fraud defense attorney who can provide legal guidance tailored to defend your business’s interests in court. Representing yourself during a DOJ fraud audit or investigation is not recommended.

2. Identify the Allegations Against Your Business

Your attorney will work to understand the specific allegations against your business, their origin, and their level of severity. This information will help you get the legal guidance you need and respond appropriately to the DOJ.

3. Be Cooperative yet Careful

While facing DOJ investigation may lead to the temptation to resist, defying an investigation into allegations of PPP loan fraud could harm your ability to defend against these accusations and may trigger more aggressive DOJ action. Therefore, it to approach the DOJ investigation cooperatively but with caution.

4. Understand Your Rights

It’s important to know your rights during a DOJ PPP loan fraud investigation or criminal case. You have the right to remain silent, and you have the right to be represented by an attorney throughout the process. Your attorney will help you understand these rights and guide you on how to respond when the DOJ comes knocking.

Takeaways

The pandemic has forced many businesses to turn to the PPP loan program to keep their doors open and employees paid. Unfortunately, many individuals and companies have faced allegations of fraudulently obtaining PPP funds or using them on unauthorized expenses. The effects of a DOJ investigation into PPP loan fraud can be potentially serious, including criminal convictions and significant fines. Therefore, it’s essential to contact an experienced PPP loan fraud defense attorney, work to demonstrate PPP loan program compliance, and know your rights. By taking these proactive steps, you’ll protect your business and reduce the risks involved with any PPP loan fraud investigation.