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Columbus PPP and EIDL Loan Fraud Lawyers

Protect Yourself from DOJ Investigation: Seek Legal Help for PPP Loan Fraud Allegations

The COVID-19 pandemic led to the creation of the Paycheck Protection Program (PPP), a forgivable, federally-backed loan program to financially assist businesses that were seriously affected by the pandemic. But instead of offering relief, PPP’s flexible guidelines, such as limited documentation requirements, quickly attracted fraudsters. As a result, the U.S. Department of Justice (DOJ) is now aggressively investigating PPP loan fraud cases and pressing criminal charges against the perpetrators. The DOJ has been collaborating with other federal agencies, such as the Internal Revenue Service Criminal Investigations (IRS-CI) and the Federal Bureau of Investigation (FBI), to investigate and prosecute fraudulent activities.

The DOJ’s strict approach to prosecuting PPP loan fraud sends a clear message to businesses and individuals who submitted fraudulent applications and used PPP funds for unauthorized expenses. If you or your company is facing an investigation for PPP loan fraud, it’s essential to understand the gravity of the situation and seek legal help immediately.

The DOJ’s Aggressive Stance Against PPP Loan Fraud

The DOJ is taking PPP loan fraud seriously because the program’s cost is high. According to a DOJ press release, “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.” The DOJ has already filed charges in various cases, such as falsifying payroll information and creating shell companies, among other PPP loan fraud schemes.

PPP Loan Fraud Investigations Can Lead to Serious Consequences

PPP loan fraud investigations can lead to several federal criminal and civil charges under pre-existing statutes. The severity of the charges is significant, as the DOJ can impose severe penalties on both business owners and employees. Charges can include making false statements to the Small Business Administration (SBA), to an FDIC-Insured bank, bank fraud, wire fraud, aggravated identity theft, tax evasion, making false statements to federal agents and conspiracy, among others.

Defenses Against PPP Loan Fraud Allegations

Although PPP loan fraud investigations have severe consequences, there are still possible defenses that individuals and companies can assert. One of the primary defenses is demonstrating that your company complied with the PPP’s guidelines by providing evidence that it lawfully obtained a PPP loan, established a segregated PPP loan account and documented the appropriate use of funds. It’s also essential to prove that you had no intention to defraud the program. However, it’s important to note that even unintentional fraud can be prosecuted as a civil offense that attracts enormous fines, treble damages, and other severe penalties.

Why Seek Legal Assistance

PPP loan fraud allegations can have serious ramifications for businesses and individuals. If you or your company is currently undergoing a DOJ investigation, it’s critical to seek legal help immediately to protect your rights and interests. The DOJ has already demonstrated its hard-line approach to PPP loan fraud by prosecuting several individuals and companies. Defending yourself in such cases requires an experienced criminal defense attorney with experience in defending PPP loan fraud cases. Todd Spodek can provide the necessary legal guidance and representation to defend you in a PPP loan fraud investigation and work to achieve the possible outcome for you and your business.