What to Do When the FBI Contacts You About Your PPP Loan
FBI agent called about “questions regarding your PPP loan.” Two FBI agents at your business. Letter about “discrepancies.” Your mind races, is this prison, should you cooperate, can you explain what happened?
Stop. Criminal investigation. Don’t say one word before calling lawyer who defends federal PPP fraud cases. Todd Spodek and our team have defended these for many, many, years – from high-profile prosecutions like Anna Delvey to business owners facing federal investigations. We’re second generation law firm with over 50 years combined experience. Call 212-300-5196 immediately.
What the FBI Already Knows
FBI says “reviewing your application, noticed discrepancies” and asks you to “help us understand payroll calculations.” Sounds reasonable. It’s interrogation.
Before FBI contacts you, they have everything. Your bank records – every deposit, withdrawal, wire transfer from day PPP deposited. Tax returns (2018-2021). Original PPP application. Forgiveness application. Your 941 filings. IRS Criminal Investigation compared your certified payroll to actual 941s. Identified discrepancies.
Examples triggering FBI contact: Certified $500K quarterly payroll, 941s show $50K. Claimed 50 employees, IRS shows 5. Applied for business that ceased 2019. Certified payroll use, FBI traced funds to luxury car, jewelry, gambling. Instagram photos of Lamborghini bought with PPP funds (prosecutors love destroying defendants with their own social media posts).
FBI already has the evidence. Contacting you for admissions – statements to destroy you. Alabama PPP cases 2023-2025: 90% of defendants who talked without attorney were indicted. Cooperation without counsel doesn’t help you. Ruins your defense.
Fourth Amendment protects against unreasonable searches. FBI obtained records through grand jury subpoenas you never saw. Now seeking final piece: your own words admitting what documents show.
Why “Voluntary Interview” Is Interrogation
FBI says: “Routine follow-up. Not accusing you. Just want your side.” That’s interrogation.
Everything you say is recorded. FBI takes contemporaneous notes. Any inconsistency becomes evidence. Worse: attempting to explain triggers separate charge under 18 USC 1001 – false statements to federal agents. Five years prison.
2025 data: Prosecutors add false statements charges in 73% of PPP cases where defendant spoke without counsel. You tell agents 25 employees, IRS shows 12 – false statement. Funds went to payroll, bank shows wire to crypto – false statement. Thought you were eligible, application shows you checked boxes under perjury – false statement.
Federal prosecutors charge PPP fraud under multiple statutes. 18 USC 1344 (bank fraud): 30 years prison. 18 USC 1343 (wire fraud): 20-30 years. 18 USC 1001 (false statements): 5 years. Talking to FBI doesn’t reduce charges. Adds to them.
Your Constitutional Rights RIGHT NOW
Fifth Amendment: “No person…shall be compelled in any criminal case to be a witness against himself.”
Absolute right to refuse FBI interview. Right to decline any questions. Invocation of Fifth Amendment cannot be used as evidence at trial. No legal obligation to respond to FBI. No penalty for invoking constitutional rights.
Say this when FBI contacts you: “I’m exercising my Fifth Amendment right to remain silent. I will not answer questions without my attorney. Direct all communication to my lawyer.”
Then stop talking. Don’t explain. Don’t justify. Don’t apologize.
Many fear refusing makes them “look guilty.” Wrong. Dangerous. Your refusal cannot be mentioned at trial. Prosecutors cannot argue “refused to talk, therefore guilty.” Prohibited by Fifth Amendment. But your statements TO FBI will be used to destroy you. Everything.
Refuse to talk: FBI investigation continues. They interview employees, vendors, accountant. Your lawyer submits white paper to prosecutor presenting evidence of lack of criminal intent BEFORE grand jury votes. You preserve defenses – good faith reliance on confusing SBA guidance that changed weekly in 2020.
Talk without lawyer: Your statements become prosecution evidence. Helpful statements dismissed as “self-serving.” Inconsistencies treated as lies. Additional false statements charges. You obliterate defenses attorney could have presented strategically.
Sixth Amendment guarantees counsel. Attorney communicates with FBI for you. Never speak directly to agents. All communication through lawyer.
Fourth Amendment protects against unreasonable searches. FBI asks to search business or home, refuse consent. They show warrant, comply but have attorney present.
FBI Los Angeles Field Office (11000 Wilshire Boulevard, Suite 1700, Los Angeles 90024) handles PPP fraud for Central District of California. When agents contact you, they frame it as “we just want to understand” or “help clear this up.” Criminal interrogation. Building case to destroy you.
What Happens Next
Invoke Fifth Amendment and refuse to talk, here’s what happens next 30-180 days.
Your attorney immediately communicates with FBI and Assistant US Attorney, evaluates what evidence government has, determines whether case has merit or is overreach based on confusing SBA guidance. Target letter from DOJ – formal notice you’re target – typically gives 14-30 days to respond BEFORE grand jury.
Critical window. Only opportunity to present evidence of lack of criminal intent before indictment. Your lawyer submits white paper to AUSA: relied on confusing SBA guidance that changed multiple times March 2020-August 2021, relied on accountant or attorney advice, good faith belief business would continue despite lockdowns, contemporaneous documentation showing thought process. Constitutional defense – SBA’s contradictory guidance and retroactive application violates due process. Cannot prosecute for “fraud” when agency’s rules were unclear and changing weekly.
Grand jury indicts you (99.9% of cases), prosecutor is publicly committed. Stood before 23 citizens, obtained indictment. Your negotiating leverage? Gone.
FBI investigation continues 30-180 days. FBI interviews employees, vendors, customers. IRS Criminal Investigation (300 North Los Angeles Street, LA Federal Building) analyzes financial records, traces how PPP funds spent, calculates alleged loss. DOJ decides whether to indict.
Indicted: Arraignment in Edward R. Roybal Federal Building (255 East Temple Street, Los Angeles). Magistrate reads charges, you enter not guilty plea, judge sets bail (surrender passport, financial monitoring). Case proceeds: discovery, plea negotiations (94% of PPP cases), potentially trial.
Statute of limitations: 10 years under PPP and Bank Fraud Enforcement Harmonization Act of 2022. PPP loans from 2020 prosecuted through 2030. FBI investigations continuing through 2025 and beyond.
Sentencing reality 2024-2025: Defendants sentenced now receive prison terms 40% longer than 2021-2022 for identical loan amounts. $200K PPP fraud: 18 months (2021) → 28-30 months (2025) in Central District of California. Judges increasingly skeptical of “honest mistake” defenses.
Dershowitz constitutional principle: Administrative state overreach. SBA changed PPP guidance multiple times 2020-2021. Treasury issued contradictory interpretations. Lenders gave conflicting advice. Retroactive application of government’s preferred interpretation – imposed years after you applied – violates due process. Cannot prosecute for fraud when agency couldn’t maintain consistent rules.
Why You Need Lawyer NOW
Waiting destroys your options. Target letter gives 14-30 days before grand jury. Once indicted, prosecutor committed, leverage gone. Pre-indictment white paper can prevent charges. Post-arrest cooperation valued far less.
PPP fraud requires specialized federal criminal defense lawyer. Generic lawyers don’t understand US Sentencing Guidelines § 2B1.1 loss calculations, don’t know SBA regulations and CARES Act guidance that changed weekly in 2020, don’t work with forensic accountants who challenge government loss calculations, don’t have relationships with prosecutors at US Attorney’s Office Major Frauds Section for Central District of California, don’t appear regularly in Edward R. Roybal Federal Building.
Todd Spodek and our team have defended federal fraud cases many, many, years. High-profile prosecutions like Anna Delvey and business owners facing federal investigations. Second generation law firm, over 50 years combined experience. Many of us used to be prosecutors. Know how federal prosecutors think, what evidence they value, what defenses work versus what fails.
We appear in federal court every week. Understand Central District of California, prosecutors in Major Frauds Section, how LA federal judges approach PPP fraud sentencing. Work with forensic accountants to document your good faith reliance on confusing SBA guidance. Know when to negotiate, when to fight.
Don’t talk to FBI. Don’t talk to SBA-OIG. Don’t talk to IRS-CI. DON’T TALK. Call 212-300-5196 right now.