Can I Get Probation Instead of Prison for EIDL Fraud?

So your probably wondering if there’s any way to avoid prison and get probation in your EIDL fraud case, and the honest answer is—it’s RARE, but not impossible. As of 2025, approximately 81% of pandemic fraud defendants receive prison sentences, not probation. That includes both PPP and EIDL cases, and the trend has been moving TOWARD incarceration, not away from it. Judges who might have considered probation in 2021 are imposing prison time in 2025 for identical conduct. The window for lenient treatment has largely closed.

We represent clients facing EIDL fraud charges throughout California and the federal system, and when someone asks us about the chances of probation, we have to be realistic. If your EIDL fraud involved more than $50,000, fabricated business information, or spending on luxury items rather than business needs, probation is unlikely unless you have EXTRAORDINARY mitigation—terminal illness, sole caretaker of disabled dependents, full restitution before sentencing, substantial cooperation against others. Even then, it’s not guaranteed. The federal system isn’t like state court, where non-violent first offenders routinely get probation. Federal guidelines and judicial practices favor incarceration for fraud cases.

That doesn’t mean you shouldn’t fight for probation—you absolutely should. Every case is different, and judges DO have discretion to vary below the guideline range and impose probation even when the guidelines recommend prison. We’ve obtained probationary sentences in fraud cases by presenting compelling mitigation that distinguished our clients from typical defendants. But going into the case EXPECTING probation, particularly if your fraud amount is over $30,000-$40,000, sets you up for disappointment. The better approach is to understand what factors make probation more or less likely, present the strongest possible mitigation case, and prepare for the realistic possibility of at least some prison time while fighting for the outcome.

Is Probation Possible for EIDL Fraud Cases?

Yes, probation is legally possible for EIDL fraud—there’s no mandatory minimum sentence for most EIDL fraud charges, so judges have authority to impose probationary sentences under 18 U.S.C. § 3561. The question isn’t whether they CAN, it’s whether they WILL. And the data shows that in the vast majority of cases, they won’t. Federal judges in 2025 include prison time in nearly every PPP and EIDL fraud sentencing, regardless of the amount involved. In only two reported cases out of hundreds of pandemic fraud sentencings did defendants receive straight probation, and both involved extraordinary circumstances.

The legal framework for probation in federal cases is governed by § 3561, which authorizes probation if the court determines after considering the sentencing factors in 18 U.S.C. § 3553(a) that imprisonment is not necessary to achieve the purposes of sentencing. Those purposes include punishment, deterrence, protection of the public, and providing the defendant with needed training or treatment. For probation to be appropriate, the court has to conclude that supervised release in the community—with conditions like restitution, community service, home confinement, and regular reporting to a probation officer—will adequately serve those purposes.

In fraud cases generally, federal judges impose probation in about 15% of cases. But for EIDL and PPP fraud specifically, the percentage is lower—closer to 6-8% based on recent sentencing data. The difference reflects judicial attitudes toward pandemic fraud. There’s a sense among many judges that stealing from emergency relief programs during a national crisis is particularly egregious, and that leniency would send the wrong message about consequences for fraud. Whether that’s fair or rational is debatable, but it’s the reality in courtrooms right now.

The cases where probation WAS imposed involved fraud amounts under $20,000, first-time offenders with clean records, full restitution before sentencing, and circumstances showing genuine hardship during the pandemic rather than greed. One involved a defendant who was the sole caretaker for a disabled child and an elderly parent, where imprisonment would have left both dependents without support. The other involved a defendant with terminal cancer who wasn’t expected to survive the guideline-recommended sentence. Those are the standards your competing against—not just “I’m a first-time offender who made a mistake,” but situations where imprisonment would cause catastrophic collateral harm.

What’s the Difference Between Probation for PPP and EIDL Fraud?

From a legal standpoint, there’s no difference—both are federal fraud offenses governed by the same sentencing statutes and guidelines. PPP fraud is typically charged as bank fraud (18 U.S.C. § 1344), wire fraud (18 U.S.C. § 1343), or false statements to a financial institution (18 U.S.C. § 1014). EIDL fraud is charged under the same statutes. The sentencing guidelines are identical—both use U.S.S.G. § 2B1.1 for calculating offense level based on loss amount and other factors. So there’s no structural reason why EIDL fraud would result in different treatment than PPP fraud.

The practical difference is that EIDL loans tended to be smaller than PPP loans. The maximum EIDL was $500,000 (later increased to $2 million for some applicants), but most were in the $10,000-$150,000 range. PPP loans could be much larger—millions of dollars for companies with high payroll. So EIDL fraud cases TEND to involve smaller loss amounts, which produces lower guideline ranges, which makes probation slightly more feasible. A $15,000 EIDL fraud for a first-time offender might have a guideline range of 4-10 months, and judges sometimes vary below that range to probation. A $500,000 PPP fraud has a guideline range of 33-41 months, and judges rarely vary all the way down to probation from that starting point.

The other practical difference is how the fraud was committed. PPP fraud often involved sophisticated schemes—fake businesses, fabricated payroll records, forged tax documents, multiple applications under different entity names. EIDL fraud was sometimes simpler—exaggerating revenue on an otherwise legitimate business’s application, or inflating the economic injury suffered during the pandemic. Judges view sophisticated fraud as more culpable, which weighs against probation. If your EIDL fraud was relatively unsophisticated—you had a real business, you overstated the revenue or the injury, but you didn’t create an elaborate scheme—that’s a better fact pattern for arguing probation than if you fabricated the entire business.

We’ve seen slightly more lenient treatment in EIDL cases involving amounts under $50,000 where the defendant had a genuine business that was struggling during the pandemic and used the money for business-related expenses (even if they weren’t eligible for the loan). Judges have more sympathy for “I was desperate to keep my business afloat” than “I made up a business to steal money.” But that sympathy doesn’t automatically result in probation—it might result in a sentence at the low end of the guidelines or a modest downward variance, but your still probably going to prison if the amount exceeds $40,000-$50,000.

How Common Are Probation Sentences in EIDL Fraud Cases?

Probation sentences are extremely uncommon in EIDL fraud cases. Based on publicly reported sentencings through 2024, fewer than 10% of EIDL fraud defendants received probationary sentences, and most of those were in cases involving fraud amounts under $25,000 with exceptional mitigation. The vast majority of defendants—approximately 81% across all pandemic fraud cases—received prison sentences. The remaining 19% includes defendants who received probation, home confinement, or other non-prison alternatives, but probation makes up only a small fraction of that 19%.

The trend is toward LESS probation over time, not more. In 2021, when the first wave of pandemic fraud cases was being sentenced, approximately 12-15% of defendants received probation. By 2023, that had dropped to around 8%. In 2024-2025, it’s probably closer to 5-6%. This reflects both prosecutorial charging decisions (DOJ is now focusing on larger cases with more egregious conduct, which are less suitable for probation) and changing judicial attitudes (less sympathy for pandemic fraud as time passes and the scope of the fraud becomes clearer).

The cases where probation WAS imposed shared common characteristics. First, small fraud amounts—typically under $20,000, occasionally up to $30,000-$40,000 in extraordinary cases. Second, full restitution before sentencing—the defendant paid back every penny, eliminating the need for a restitution order and demonstrating accountability. Third, first-time offenders with clean records and strong community ties—no prior criminal history, stable employment, family support. Fourth, extraordinary personal circumstances that made imprisonment particularly harsh—serious medical conditions, caretaking responsibilities, age (very young or elderly defendants), or other factors that distinguished them from typical defendants.

Even when ALL of those factors are present, probation isn’t automatic. We had a case last year involving $18,000 EIDL fraud, first-time offender, full restitution before sentencing, genuine business that struggled during pandemic, defendant was primary caretaker for elderly parent with dementia. Everything lined up for probation. The PSR recommended probation. Defense argued for it. Government didn’t oppose it. Judge imposed 6 months. The reasoning: “While I’m sympathetic to the defendant’s circumstances, probation would not adequately reflect the seriousness of defrauding a government relief program. Six months is a significant downward variance from the guidelines, and it reflects the mitigation, but some incarceration is necessary for deterrence.” That’s the sentiment in many courtrooms.

What Factors Make a Judge More Likely to Grant Probation?

Judges consider the 18 U.S.C. § 3553(a) factors when deciding between prison and probation. The factors that most strongly favor probation in EIDL fraud cases are:

Small fraud amount. The closer you are to the bottom of the loss table, the better your chances. Under $10,000 gives you a realistic shot at probation (though still not likely). $10,000-$25,000 is possible with strong mitigation. $25,000-$50,000 requires extraordinary circumstances. Over $50,000, probation is extremely rare absent terminal illness or similarly compelling factors.

Full restitution before sentencing. This is probably the single most important factor you can control. Paying back the entire fraud amount before your sentencing hearing eliminates the victim’s financial loss and demonstrates genuine acceptance of responsibility. It doesn’t guarantee probation, but almost every EIDL fraud case that resulted in probation involved full pre-sentencing restitution. If you can scrape together the money—borrow from family, sell assets, liquidate retirement accounts—do it. The difference between owing $30,000 in court-ordered restitution and having already paid it back can be the difference between probation and 12 months in prison.

Genuine business with legitimate use of funds. If you had a real business that was actually harmed by the pandemic, and you used the EIDL funds primarily for legitimate business expenses (payroll, rent, utilities, inventory) even though you weren’t technically eligible for the loan, that’s more sympathetic than fabricating a business and spending the money on personal items. Judges understand that the EIDL program was confusing, the rules were unclear, and some applicants bent the truth because they were desperate rather than greedy. That doesn’t make it legal, but it can be mitigation for sentencing.

Extraordinary personal circumstances. Serious medical conditions that make imprisonment dangerous (advanced cancer, need for dialysis, severe mental health issues requiring intensive treatment), caretaking responsibilities where imprisonment would leave vulnerable dependents without support (disabled child, elderly parent, special needs sibling), or other factors that make prison particularly harsh. Generic hardship—”I have a family,” “I’ll lose my job,” “prison will be difficult”—doesn’t cut it because those things are true for every defendant. You need circumstances that are genuinely different from what typical defendants face.

First-time offender with strong community ties. Clean criminal record, stable employment history, family support, community involvement, letters from employers and community members vouching for your character—these are baseline factors for ANY probation argument. They’re necessary but not sufficient. Standing alone, they won’t get you probation in a fraud case over $30,000-$40,000, but combined with other mitigation, they support the argument that your conduct was an aberration and that community supervision will adequately serve the purposes of sentencing.

Early cooperation and acceptance of responsibility. If you admitted guilt immediately when confronted, cooperated with the investigation, provided information about how the fraud occurred, and took every step to make amends, that demonstrates character. If you lied to investigators, blamed others, destroyed evidence, or fought the charges until trial, then pled guilty only after you lost—judges notice. Genuine acceptance of responsibility can’t be faked, and it matters for sentencing.

The absence of certain aggravating factors also helps. If there’s no sophisticated means enhancement (you didn’t use fake entities or elaborate concealment), no identity theft (you didn’t use someone else’s information), no leadership role (you didn’t organize others to commit fraud), and no particularly egregious spending (luxury cars, jewelry, gambling), your offense is less serious than typical cases. That doesn’t mean probation, but it means the judge has fewer reasons to impose a harsh sentence.

Does the Amount of the EIDL Loan Matter for Probation Eligibility?

Yes, the fraud amount is THE critical factor. It drives the guideline calculation under U.S.S.G. § 2B1.1, and it heavily influences whether judges will vary below the guidelines to probation. As a very rough guideline based on actual sentencing outcomes:

• Under $10,000: Probation is possible, though still not the most common outcome. If you have strong mitigation and full restitution, there’s maybe a 30-40% chance of probation. Without strong mitigation, expect 4-8 months.
• $10,000-$25,000: Probation is uncommon but achievable with exceptional mitigation and full restitution. Probably 15-20% chance with perfect facts. More likely outcome is 6-12 months.
• $25,000-$50,000: Probation is rare. Maybe 5-8% chance, and only with truly extraordinary circumstances (terminal illness, similar). Typical sentence is 12-18 months.
• $50,000-$150,000: Probation is extremely rare. Less than 2-3% chance. Would require near-miraculous mitigation. Typical sentence is 18-30 months.
• Over $150,000: Probation is virtually unheard of. We’re not aware of any reported EIDL fraud case over $150,000 that resulted in probation. Typical sentence is 30+ months.

These percentages are rough estimates based on reported sentencings and our experience, not official statistics. And they assume first-time offender with acceptance of responsibility—if you have prior convictions or aggravating factors, the chances of probation drop significantly. The point is that the fraud amount creates practical thresholds. Below $25,000, probation is in the realm of possibility if you fight for it. Above $50,000, your fighting an uphill battle. Above $100,000, your arguing for a miracle.

The loss amount also determines your base guideline range, which sets expectations for the judge, the prosecutor, and probation. If your guideline range is 4-10 months, a variance to probation is a modest departure—the judge is going from recommending a year or less of prison to recommending supervised release instead. That’s a significant variance, but it’s within the realm of normal judicial discretion. If your guideline range is 33-41 months and your asking for probation, your asking the judge to reject the guidelines entirely and impose a sentence 3+ years below the recommendation. That requires extraordinary justification under § 3553(a), and judges are reluctant to vary that dramatically unless the facts are truly exceptional.

Can I Get Home Confinement Instead of Prison?

Home confinement is a middle ground between prison and probation—your confined to your residence (with exceptions for work, religious services, medical appointments, and other approved activities) and monitored via ankle bracelet, but your not in a Bureau of Prisons facility. There are two ways home confinement happens in federal cases: as a condition of probation, or as a period of BOP custody served at home under the Residential Reentry Center (RRC) program.

Home confinement as a condition of probation is ordered by the judge at sentencing. The sentence might be “3 years probation, with 12 months to be served in home confinement.” You never go into BOP custody—you report to probation, they set up the ankle monitor, and you serve the home confinement period at your residence under probation supervision. After the home confinement period ends, you continue on regular probation. This is better than prison because your at home, you can maintain employment (if your job allows you to work from home or if the court approves leave for work hours), you can be with your family, and you don’t have the collateral consequences of BOP custody.

Home confinement as BOP placement happens near the end of a prison sentence. Under current law, BOP can place inmates in home confinement for up to the shorter of 10% of the sentence or 6 months, and the First Step Act expanded that for certain inmates. So if your sentenced to 18 months in prison, you might serve 12-13 months in a federal prison camp, then the final 5-6 months in home confinement. This is controlled by BOP, not the judge—the judge can RECOMMEND home confinement, but BOP makes the final decision based on their criteria (offense characteristics, behavior in custody, release plan, risk assessment).

In EIDL fraud cases, home confinement as a condition of probation is sometimes ordered in cases where the guideline range is 6-15 months and the judge wants to impose something more punitive than straight probation but less harsh than prison. We’ve seen sentences like “2 years probation with 8 months home confinement” in $30,000-$50,000 EIDL fraud cases with strong mitigation. This splits the difference—the defendant serves a period of confinement (satisfying deterrence and punishment goals) but stays at home (recognizing mitigation and family circumstances).

The requirements for home confinement are strict. You need a stable residence with a landline phone (for the monitoring equipment), approval of the residence by probation or BOP, compliance with conditions (no alcohol, submit to searches, maintain employment or participate in programs), and someone at the residence who understands the requirements. If you violate the conditions—leave without authorization, tamper with the monitor, possess contraband—you’ll be taken into custody and the remainder of your sentence will be served in prison. But if you comply, home confinement allows you to avoid many of the worst consequences of incarceration.

What’s the Difference Between Probation and Home Confinement?

Probation is supervised release in the community with conditions like regular reporting to a probation officer, payment of restitution, community service, drug testing, and restrictions on travel and association. You live at home, work, maintain your normal life, but under supervision and subject to conditions. If you violate probation, the court can revoke it and sentence you to prison for the original offense.

Home confinement is a form of custody or a condition of probation where your confined to your residence and monitored electronically. You wear an ankle monitor that tracks your location, and you can only leave for pre-approved purposes (work, medical appointments, religious services, court appearances, approved programs). If you leave for unauthorized purposes, the monitor alerts the supervising authority and you’ll be arrested for violating the conditions.

When home confinement is ordered as a condition of probation, your on probation subject to all the standard conditions, PLUS the additional restriction of being confined to your residence. After the home confinement period ends (say, 12 months), you continue on probation but without the confinement restriction. When home confinement is ordered as BOP custody, your in federal custody serving your sentence, just at home instead of in a facility. After the home confinement period ends, your released to supervised release (the post-prison supervision period that’s part of most federal sentences).

From the defendant’s perspective, home confinement is more restrictive than regular probation but less restrictive than prison. You can’t go out socially, can’t travel freely, can’t participate in normal activities—but your at home with your family, sleeping in your own bed, eating regular food, maintaining some degree of normal life. For defendants with strong family ties, employment that can continue from home, and the ability to comply with strict conditions, home confinement is a vastly better outcome than prison. For defendants who can’t work from home, have unstable housing, or would struggle with the restrictions, it’s more challenging.

In arguing for probation with home confinement as an alternative to prison in EIDL fraud cases, we emphasize that home confinement serves the § 3553(a) purposes just as effectively as incarceration. It punishes (you lose your freedom, can’t leave your home, live under constant monitoring). It deters (both you and others who hear about the consequences). It incapacitates (you can’t commit further crimes while confined and monitored). And it allows rehabilitation (you can maintain employment, family relationships, treatment programs, community ties). For non-violent financial crime committed by first-time offenders, there’s a strong argument that home confinement achieves everything prison would achieve, without the collateral damage to families and communities.

Do First-Time Offenders Have Better Chances of Getting Probation?

Yes, being a first-time offender significantly improves your chances of probation, but it doesn’t make probation LIKELY in most EIDL fraud cases—it just makes it POSSIBLE. Clean criminal history puts you in criminal history category I under the federal sentencing guidelines, which produces the lowest guideline ranges. And judges view first-time offenders more favorably than repeat offenders when considering variances below the guidelines.

The statistics show that among the small percentage of pandemic fraud defendants who received probation, nearly all were first-time offenders. We’re not aware of any reported case where a defendant with prior felony convictions received probation for EIDL fraud over $20,000. So clean criminal history is essentially a prerequisite for probation—necessary but not sufficient. It gets you into the conversation, but you still need other strong mitigation to actually obtain probation.

The theory is that first-time offenders are more likely to be rehabilitated by probation and less likely to re-offend than people with criminal records. The conduct is an aberration, not a pattern. Community supervision with conditions can address whatever circumstances led to the offense without the criminogenic effects of imprisonment (loss of employment, disruption of family ties, exposure to prison culture, difficulty reintegrating). For someone who’s never been in trouble before, probation can serve deterrence and punishment purposes while allowing them to maintain the positive aspects of there life.

But first-time offender status doesn’t outweigh all other factors. If your a first-time offender who committed $200,000 in EIDL fraud using sophisticated means, spent the money on luxury items, and hasn’t paid any of it back, your not getting probation. Your criminal history category I might keep your guideline range lower than it would be if you had prior convictions (maybe 30-37 months instead of 41-51 months), but the judge still isn’t varying all the way down to probation. The fraud amount, the conduct, and the lack of restitution override the benefit of clean record.

Conversely, if your a first-time offender with $15,000 EIDL fraud, full restitution, genuine business, and strong family ties, you have a realistic chance at probation. Not certain—judges still impose prison time in small-dollar cases with first-time offenders—but realistic. The combination of low offense level (guideline range probably 4-10 months), criminal history I, strong mitigation, and lack of aggravating factors gives the judge room to conclude that probation with conditions will adequately serve the sentencing purposes.

Will Paying Back the EIDL Loan Help Me Get Probation?

Yes, full restitution before sentencing is one of the most powerful mitigation factors, and it’s present in almost every EIDL fraud case that resulted in probation. Judges view early restitution as evidence of genuine remorse and acceptance of responsibility. It eliminates the victim’s financial loss (the main harm from fraud), it demonstrates that you’ve taken concrete steps to make amends rather than just offering apologies, and it shows you have resources and support (family willing to help, assets you were willing to liquidate) that make successful probation more likely.

The timing matters enormously. Restitution paid BEFORE any investigation started is the strongest mitigation—it suggests you recognized your mistake and tried to fix it on your own. Restitution paid AFTER investigators contacted you but before charges were filed is still meaningful. Restitution paid after charges but well before sentencing (months in advance, not days) demonstrates commitment. Restitution paid the week before your sentencing hearing—while better than nothing—looks like your motivated by wanting a lighter sentence rather than genuine remorse.

Partial restitution is better than no restitution, but it’s not nearly as compelling as full repayment. If you took $50,000 and paid back $20,000, you’ve reduced the outstanding loss, and that’s positive. But the government still has to seek a restitution order for the remaining $30,000, the victim isn’t made whole, and there’s a question about why you couldn’t pay the rest—if you found $20,000, why not $50,000? Judges sometimes view partial restitution cynically, particularly if it looks like you paid back what you could easily access while hiding other assets.

If you can POSSIBLY pay full restitution before sentencing, do it. Borrow from family members. Take a second mortgage. Liquidate retirement accounts (yes, there are tax consequences, but prison has worse consequences). Sell cars, jewelry, anything of value. Set up a payment plan with the prosecutor where you pay large amounts pre-sentencing and the balance over time. Whatever it takes to show up at your sentencing hearing having made the victim whole. We’ve had clients who paid $40,000, $60,000, $80,000 in restitution before sentencing—money they borrowed from parents, siblings, extended family—and it made the difference between 18 months in prison and probation.

One warning: don’t commit NEW crimes to pay restitution. We’ve seen defendants who took out new loans using false information, sold property that had liens on it without paying off the liens, or engaged in other misconduct to get money for restitution. That destroys any mitigation value and creates additional charges. The restitution has to come from legitimate sources, and you have to be prepared to document where the money came from if the court or probation asks.

How Does Pleading Guilty Affect My Chances of Probation?

Pleading guilty is essentially mandatory for any realistic chance at probation. The acceptance of responsibility reduction under U.S.S.G. § 3E1.1 is worth 2-3 levels (typically 6-12 months off your guideline range), and you can’t get it if you go to trial. More importantly, judges almost never impose probationary sentences on defendants who go to trial and lose. Going to trial is your constitutional right, but as a practical matter, it eliminates probation as a sentencing option except in the most extraordinary circumstances.

The earlier you plead guilty, the stronger your acceptance of responsibility argument. Pleading at arraignment or within 30-60 days of indictment, before substantial litigation, shows that you took responsibility immediately. That’s genuine acceptance. Pleading guilty the week before trial, after 18 months of litigation and losing all your motions, looks like you recognized the evidence was overwhelming and made a calculated decision to cut your losses. You might still get the technical 2-level reduction (the guidelines allow it as long as you plead before trial), but judges can deny the additional 1-level reduction, and they’re less likely to view your conduct as demonstrating the kind of genuine remorse that warrants probation.

Early guilty pleas can also facilitate cooperation. If you plead guilty and offer to provide information about co-conspirators, loan preparers who helped you, or other fraud schemes you’re aware of, the government might be willing to file a § 5K1.1 substantial assistance motion recommending a downward departure. That departure, combined with strong personal mitigation, can sometimes result in recommendations for probation or very short sentences in cases where the guidelines would otherwise recommend significant prison time.

The flip side is that pleading guilty alone doesn’t guarantee probation or even a light sentence. Acceptance of responsibility is required for probation, but it’s not sufficient by itself. You also need small fraud amount, full restitution, first-time offender status, and compelling personal mitigation. We’ve had clients who pled guilty immediately, expressed genuine remorse, cooperated fully, and still received prison sentences because the fraud amount was substantial or the conduct was particularly egregious. Pleading guilty is the foundation of a probation argument, not the entire argument.

What About Probation With Conditions—What Does That Mean?

Probation in federal cases always comes with conditions. The standard conditions under 18 U.S.C. § 3563 include: not committing another crime, not possessing firearms, submitting to drug testing, allowing searches by probation, notifying probation of changes in residence or employment, not leaving the judicial district without permission, and reporting regularly to a probation officer. Those apply to every probationary sentence.

In fraud cases, judges typically impose additional conditions specific to the offense. The most common are:

Restitution. If you haven’t paid full restitution before sentencing, the court will order you to pay the outstanding amount as a condition of probation. You’ll make monthly payments based on your income, and failure to make payments can result in probation violation proceedings. The restitution obligation continues even after your probation term ends—it’s a criminal debt that doesn’t go away until it’s paid in full.

Community service. Judges often order defendants in fraud cases to perform community service—100, 200, 500 hours depending on the offense seriousness. This serves both punishment and rehabilitation purposes. You have to complete the hours during your probation term, document them, and report them to probation.

Home confinement. As discussed earlier, the court can order a period of home confinement as a condition of probation. You wear an ankle monitor and are confined to your residence except for approved activities. This is common in cases where the judge wants to impose something more punitive than straight probation but is willing to vary below a prison sentence.

Employment or education. The court can require you to maintain employment or participate in education or training programs. This is partly about ensuring you have the means to pay restitution and support yourself, and partly about reducing the risk of recidivism.

Financial disclosure and restrictions. In fraud cases, courts sometimes order defendants to provide regular financial disclosures to probation, restrict them from opening new credit accounts, prohibit them from serving as officers or directors of companies, or impose other financial controls to reduce fraud risk and ensure restitution payments.

Mental health or substance abuse treatment. If the PSR identifies mental health issues or substance abuse problems that contributed to the offense, the court can order treatment as a condition of probation.

The conditions are enforceable through probation violation proceedings. If you violate a condition—fail to report, get arrested for new charges, don’t pay restitution, miss drug tests—probation can file a violation petition, and the court can revoke your probation and sentence you to prison for the original offense. The supervised release term for fraud offenses is typically 2-3 years, so you’ll be under supervision and subject to conditions for years after sentencing.

When we’re arguing for probation in EIDL fraud cases, we often propose specific conditions as part of our sentencing recommendation. “The defendant requests probation with 12 months home confinement, 300 hours community service, monthly restitution payments of $500, financial monitoring by probation, and participation in a financial literacy program.” This shows the judge that probation won’t be a slap on the wrist—there will be real consequences and supervision. It makes the probationary sentence look more like punishment and less like letting the defendant off easy.

Can My Defense Attorney Negotiate for Probation?

Yes, your attorney can negotiate with the prosecutor for a sentencing recommendation of probation, and in some cases prosecutors will agree not to oppose a probation request or to recommend a specific below-guidelines sentence. But prosecutors can’t GUARANTEE probation because the judge makes the final decision. Under Federal Rule of Criminal Procedure 11(c), there are binding plea agreements under Rule 11(c)(1)(C) where the sentence is part of the deal and the judge either accepts it or rejects it, but those are rare. Most plea agreements involve recommendations, not guarantees.

In small EIDL fraud cases (under $20,000-$25,000) with strong mitigation, some U.S. Attorney’s Offices will agree to recommend probation as part of a plea agreement. The agreement might say “The government agrees to recommend a sentence of probation with home confinement and restitution,” or “The government will not oppose the defendant’s request for a non-prison sentence.” That doesn’t bind the judge, but it carries weight—judges often follow joint recommendations when both sides agree on a sentence.

More commonly, the negotiation centers on disputed guideline applications rather than direct probation recommendations. Your attorney might negotiate for the government to agree that sophisticated means enhancement doesn’t apply, reducing your offense level by 2. Or negotiate a stipulation that loss amount is $38,000 rather than $42,000, keeping you below the threshold for the next enhancement level. Or get the government to agree not to oppose a minor role reduction. These concessions reduce the guideline range, which makes a variance to probation more feasible even if the government isn’t explicitly recommending it.

The leverage in negotiations depends on the strength of the government’s case, the resources required to prosecute it, and the office’s priorities. If the evidence against you is overwhelming, you’re not cooperating, and your fraud amount is substantial, prosecutors have little incentive to recommend probation. If the evidence has some weaknesses, you’re providing valuable information about others, the fraud amount is modest, and you’ve paid full restitution, prosecutors might be willing to recommend a lenient sentence to avoid the expense and uncertainty of trial.

An experienced federal defense attorney’s value isn’t just in negotiating—it’s in presenting your mitigation case to the judge in the most compelling way possible. Even if the government recommends prison, your attorney can argue for probation based on the § 3553(a) factors, present evidence of your personal circumstances, challenge disputed guideline calculations, cite cases where judges imposed probationary sentences in similar situations, and make the record for appeal if the judge imposes a prison sentence. The sentencing memorandum, the evidence presented, the witnesses called, the way your attorney frames the argument—all of that can influence whether the judge varies below the guidelines to probation.

What Are the Alternatives If I Can’t Get Probation?

If probation isn’t realistic given the facts of your case, the goal becomes minimizing the prison sentence and maximizing alternatives within the sentence. The main alternatives are:

Downward variance to below-guidelines prison term. Even if the judge won’t go all the way to probation, they might vary below the guideline range to impose a shorter prison sentence. If your guidelines are 18-24 months and you have strong mitigation, the judge might impose 12 months. That’s not probation, but it’s 6-12 months less than you would’ve received without the mitigation.

Home confinement as part of BOP custody. As mentioned earlier, BOP can place inmates in home confinement for up to 6 months or 10% of the sentence. So a 15-month sentence might be 10 months in a federal camp plus 5 months home confinement. The judge can recommend this at sentencing, though BOP makes the final decision.

Recommendation for camp placement. Federal prisons range from maximum-security penitentiaries to minimum-security camps. Camps have no fences, minimal supervision, and conditions more like a college dorm than a prison. Most non-violent first-time fraud offenders are eligible for camp placement, and judges can recommend it at sentencing. BOP makes the designation, but judicial recommendations carry weight.

Split sentence with halfway house. Judges can structure sentences so that part is served in a BOP facility and part in a Residential Reentry Center (halfway house). A sentence of “18 months, with recommendation for maximum RRC placement” signals that the judge wants as much of the sentence as possible served in the less-restrictive halfway house setting rather than in a prison.

Concurrent vs. consecutive sentences. If your facing multiple counts, whether the sentences run concurrently (at the same time) or consecutively (one after another) makes a huge difference. Most fraud sentences run concurrently, but if there are aggravating factors, prosecutors sometimes seek consecutive sentences. Your attorney should argue for concurrent.

Supervised release conditions favorable to rehabilitation. Every federal sentence includes a term of supervised release after the prison time is served. Arguing for conditions that facilitate rehabilitation—approval for self-employment, permission to travel for work, access to education or vocational training programs—can help you reintegrate successfully after release.

The reality is that if your EIDL fraud involved more than $50,000, you should prepare for prison time and focus on minimizing the length and maximizing favorable conditions rather than holding out hope for probation. That’s not defeatist—it’s realistic. The federal system is harsh on fraud, particularly pandemic fraud, and judges are imposing prison sentences in the vast majority of cases. But there’s a huge difference between 36 months in a medium-security prison and 12 months in a camp with 4 months home confinement—and an experienced attorney can fight for the latter even when probation isn’t achievable.

If your facing EIDL fraud charges, talk to a federal criminal defense attorney immediately. The decisions you make early in the case—whether to cooperate, when to plead guilty, whether to pay restitution, how to document your mitigation—affect your sentencing outcome. We represent clients in PPP and EIDL fraud cases throughout California and the federal system, and we’re experienced in fighting for probationary sentences when possible and minimizing prison time when probation isn’t realistic. Call us for a consultation about your case and honest assessment of your options.