CALIFORNIA CRIMINAL LAWYERS

Wisconsin PPP and EIDL Loan Fraud Lawyers

How to Defend Yourself Against DOJ Investigation for PPP Loan Fraud

The COVID-19 pandemic has compelled businesses in the United States to seek federal assistance programs such as the Paycheck Protection Program (PPP), a forgivable loan program aimed at helping companies keep their employees paid and their doors open throughout the pandemic. Unfortunately, PPP loan fraud allegations have been rampant, leading to the DOJ targeting numerous companies and individuals accused of fraudulently obtaining and misusing PPP funds. If you are facing a Department of Justice (DOJ) investigation for PPP loan fraud, it is essential to take the allegations seriously and act swiftly to mitigate your risks. Here’s what you need to know to defend yourself against a DOJ investigation for PPP loan fraud.

DOJ’s Stance on PPP Loan Fraud

The DOJ has been aggressive in targeting allegations of PPP loan fraud, and numerous individuals and companies have been indicted under a range of statutes. The DOJ press release issued in early 2021 emphasized that “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, if your company is targeted in a DOJ PPP loan fraud investigation, you must engage an experienced PPP loan fraud defense attorney who will help identify the specific allegations, provide legal advice, and guide you through the DOJ’s investigation.

Possible Defenses Against PPP Loan Fraud

If you are accused of PPP loan fraud, several defenses can apply, including PPP loan compliance and demonstrating a lack of intent, which may suffice for demonstrating your innocence. Federal criminal statutes for fraud typically require proof of intent to defraud. Though lack of intent is not always enough to protect your business from a criminal investigation or civil enforcement action.

PPP Loan Fraud Investigations Statutes

The DOJ has already charged several individuals and companies with federal offenses related to PPP loan fraud, including FBI-IPA Investigations, False statements to the Small Business Administration (SBA) (18 U.S.C. § 1014) Wire Fraud (18 U.S.C. § 1343), among others. It is possible that more charges may emerge as the DOJ continues to investigate allegations of PPP loan fraud.

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

Facing allegations of PPP loan fraud can have severe consequences, including criminal convictions and hefty fines. To mitigate your risks, consider these steps:

1. Contact an Experienced PPP Loan Fraud Defense Attorney

An experienced PPP loan fraud defense attorney will provide legal guidance tailored to your interests in court. It is not recommended to represent yourself during a DOJ fraud audit or investigation.

2. Identify the Allegations Against You

Your attorney will seek to understand the specific allegations, their origin and level of severity, and provide legal guidance to respond appropriately to the DOJ.

3. Be Cooperative but Careful

It may be tempting to resist the DOJ investigation into allegations of PPP loan fraud. Still, a confrontational attitude may harm your ability to defend against the allegations and trigger more aggressive DOJ action.

4. Understand Your Rights

It is essential to understand your individual rights during a DOJ PPP loan fraud investigation or criminal case. You have the right to remain silent and to be represented by an attorney throughout the process. Your attorney will help you understand these rights and how to respond appropriately when the DOJ comes calling.

Conclusion

The Paycheck Protection Program has indeed helped many businesses stay afloat and retain employees during the pandemic, but the fraudulently obtained funds and the unauthorized expenses have equally led to PPP loan fraud allegations. If you are facing a DOJ investigation for PPP loan fraud, you must take the allegations seriously and engage an experienced PPP loan fraud defense attorney to defend yourself and your business. Be cooperative but careful, understand your rights, and demonstrate PPP loan compliance or lack of intent, which may present themselves as possible defenses against PPP loan fraud allegations.