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Austin EIDL and PPP Loan Fraud Lawyers

The Paycheck Protection Program (PPP)

The Paycheck Protection Program (PPP) is a federal loan program designed to help small businesses keep their workers on the payroll during the COVID-19 pandemic. The PPP offers loans of up to $10 million, with interest rates of 1%, and terms of up to 10 years, to small businesses that maintain their payroll during the crisis. The loan forgiven if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.

Program Details

The PPP was created by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which was signed into law on March 27, 2020. The program is administered by the Small Business Administration (SBA).

As of June 30, 2020, there have been 4.9 million loans totaling more than $520 billion approved under the PPP.

The PPP has been criticized for its lack of transparency, as the SBA has not released data on who has received loans. Additionally, some large corporations have received loans despite having other sources of funding, leading to claims that the program is benefiting well-connected businesses rather than truly small businesses.

George FernandezGeorge Fernandez
14:16 30 Apr 24
Excellent 10 out of 10, Helped resolve my case. Jeremy explained everything and made everything easy to understand.
RajRaj
21:33 24 Apr 24
If you are looking for a lawyer that listens, is aggressive where needed, and holds his word above all else, Todd is the best pick. I had hired multiple attorneys prior to hiring the Spodek Group for a white collar case. The first thing that stood out to me was the cost, as anyone going through the process and dealing with the system, money was tight at that time - especially after hiring and firing multiple lawyers. The cost was not as high as others which was definitely a plus. Todd's intake process was also unlike other attorneys. He took the time to actually listen. He cared. He was trying to put himself in my shoes while I was explaining the situation to him and he really took the time to understand the whole situation. Other lawyers will give you 15 mins and send you a retainer agreement. Not Todd, I think he spent almost two hours with me as I was explaining everything.Not only was he great during the onboarding process, he was supportive and very informative through the entire plea process and eventually sentencing. After hiring him, I asked if I should hire a prison consultant, he told me to save my money as he would do everything they would. He was right and held up to his word. Later on I would hear from others that went with the prison consultants that they were a waste of money - I am glad I listened to Todd!When it came time for sentencing, two days prior to sentencing, the prosecutor tried increasing my proposed prison time by almost double - apparently a normal move. Todd and his team worked with me non-stop through the weekend prior to sentencing to ensure that I was not given additional prison time. Again, he took the time to listen and came up with a strategy to explain the case with great detail.Unfortunately, I did plead guilty as that was my best option. Todd and his whole team wrote up nearly 300 pages of a summary of what happened and why I should not be given prison time. If I breakdown the amount I spent with Todd versus the amount of work that I saw being done, I am shocked I was not charged four times as much. The other benefit was, a lot of criminal defense lawyers were just a single attorney with a paralegal or two. Todd had a team of people that I dealt with (5-7 people that I interacted with), but he was ALWAYS accessible. It would never take him more than an hour to reply unless he was in court.I was sentenced to prison and I was emotionally distraught. Todd and his team did whatever they could even after sentencing to make sure I was alright. He personally stayed in touch with my family to ensure I was doing alright and offered support to them. Most lawyers would consider the job complete at sentencing, not Todd.After prison, Todd still spent time with me to make sure I was on the right track and avoiding any potential risks in the future. He has also been giving advice on how to navigate probation etc and has not been looking at the clock for billing.Although I wish I had never been arrested in the first place, I am glad I had Todd and his team in my corner. Without them I likely would have had to spend a lot more time in prison than I did.Thank you, Todd, and the entire Spodek Law team, for helping turn what was a nightmare into a manageable situation!
Yelva Saint-PreuxYelva Saint-Preux
19:26 19 Apr 24
I am immensely grateful to the entire team at Spodek Law Group for their unwavering dedication and exceptional expertise throughout my case. From our initial consultation to the final resolution, their professionalism and tireless advocacy made all the difference. Their strategic approach and attention to detail instilled confidence in me every step of the way.Thanks to their hard work and commitment, we achieved a truly favorable outcome that exceeded my expectations. Not only did they navigate the complexities of my case with precision, but they also provided invaluable support and guidance during what was undoubtedly a challenging time. I cannot recommend Spodek Law Group highly enough, especially attorneys Todd Spodek and Claire Banks; they are beacons of excellence in the legal profession.YSP.
Katherine SunKatherine Sun
18:08 18 Apr 24
my lawyer is Alex Zhik. Efficient, patient and professional
Nun yaNun ya
17:48 18 Apr 24
Todd, Ralph and Alex are amazing. Helped my husband get from a double digit number with multiple charges to a single digit, by the time I blink he will be out. They very professional and help with all your needs. They dealt with my anxiety and worry very well and they understand that your family member needs to get home as soon as possible.
Keisha ParrisKeisha Parris
20:45 15 Mar 24
Believe every single review here about Alex Z!! From our initial consultation, it was evident that Alex possessed a profound understanding of criminal law and a fierce dedication to his clients rights. Throughout the entirety of my case, Alex exhibited unparalleled professionalism and unwavering commitment. What sets Alex apart is not only his legal expertise but also his genuine compassion for his clients. He took the time to thoroughly explain my case, alleviating any concerns I had along the way. His exact words were “I’m not worried about it”. His unwavering support and guidance were invaluable throughout the entire process. I am immensely grateful for Alex's exceptional legal representation and wholeheartedly recommend his services to anyone in need of a skilled criminal defense attorney. Alex Z is not just a lawyer; he is a beacon of hope for those navigating the complexities of the legal system. If you find yourself in need of a dedicated and competent legal advocate, look no further than Alex Z.
Taïko BeautyTaïko Beauty
16:26 15 Mar 24
I don’t know where to start, I can write a novel about this firm, but one thing I will say is that having my best interest was their main priority since the beginning of my case which was back in Winter 2019. Miss Claire Banks, one of the best Attorneys in the firm represented me very well and was very professional, respectful, and truthful. Not once did she leave me in the dark, in fact she presented all options and routes that could possibly be considered for my case and she reinsured me that no matter what I decided to do, her and the team will have my back and that’s exactly what happened. Not only will I be liberated from this case, also, I will enjoy my freedom and continue to be a mother to my first born son and will have no restrictions with accomplishing my goals in life. Now that’s what I call victory!! I thank the Lord, My mother, Claire, and the Spodek team for standing by me and fighting with me. Words can’t describe how grateful I am to have the opportunity to work with this team. I’m very satisfied, very pleased with their performance, their hard work, and their diligence.Thank you team!
K MarK Mar
01:37 25 Jan 24
I recently had Spodek Law Group represent me for a legal matter in NYC and I am thoroughly impressed with their services.Alex Zhik secured the best possible outcome for my case.It was a seamless journey from the initial consultation to the resolution of my legal matter. From the moment I spoke to Todd about my case, his enthusiasm to help was evident, setting a positive tone for the entire experience. The efficiency and professionalism displayed by the team is commendable.A particularly noteworthy aspect of their service is their user-friendly portal to upload your documents/evidence. This not only simplified the process, but showcases their commitment to streamline the client experience.Lastly, in an industry where legal fees can often be a concern, I found their pricing to be very reasonable, making needing legal assistance feel accessible and stress-free.I am grateful for their support and wouldn't hesitate to turn to them again in the future.
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Despite these criticisms, the PPP has been credited with helping to keep millions of small businesses afloat during the pandemic.

If you’re a small business owner who is struggling to keep your business afloat during the COVID-19 pandemic, the Paycheck Protection Program may be able to help.

For more information on the program, visit the Small Business Administration’s website.

Austin PPP Loan Fraud Lawyers

Fraudulent claims can be made against you for PPP loan forgiveness using various types of fraud. Some examples include:

  • Borrower certification fraud – This is when a borrower lies about their eligibility for the PPP loan under the law.
  • Application fraud – This is when you lie on your application or make false statements to get more money than you are entitled to receive.
  • Forgiveness fraud – This occurs where someone lies about how they spent their PPP loan funds and requests forgiveness for expenses that were not actually paid with those funds, or made in order to keep employees employed who were never actually employed by them.

These types of fraud can be prosecuted as federal crimes under various statutes, such as 18 USC 1001 (false statements), 20 USC 1097 (embezzlement), and 18 USC 1341 (mail/wire fraud). If convicted, these crimes carry potential penalties of up to 5 years in prison, fines of up to $250,000 ($500,000 if an organization) plus restitution and costs of prosecution. These charges could also result in civil liabilities under laws like False Claims Act and Fair Debt Collection Practices Act which carry damages ranging from double damages plus attorneys’ fees and costs all the way up

According to the Federal Trade Commission, PPP fraud is a type of loan fraud that occurs when someone uses false information to apply for a Paycheck Protection Program (PPP) loan. This can include using false information about your business, such as its size or number of employees, in order to qualify for a larger loan amount. Additionally, scammers may use stolen personal information to apply for loans in your name.

If you have been the victim of PPP fraud, you should report it to the FTC and your local law enforcement agency. You can also file a complaint with the Consumer Financial Protection Bureau.

The best way to avoid PPP fraud is to be cautious when applying for a loan. Be sure to only provide accurate information about your business, and do not give out your personal information to anyone you do not know. If you are unsure about a loan offer, you can check with the Small Business Administration or your local chamber of commerce to see if it is legitimate.

If you have already applied for a PPP loan, be sure to keep an eye on your bank account and credit report for any unusual activity. If you see anything that looks suspicious, report it to your bank and the relevant authorities right away.

By taking these precautions, you can help protect yourself from PPP fraud and other types of loan fraud.

EIDL Program

The Economic Injury Disaster Loan (EIDL) program is a federal disaster loan program that provides low-interest loans to small businesses and non-profit organizations that have suffered substantial economic injury as a result of a declared disaster.

The EIDL program is administered by the U.S. Small Business Administration (SBA) and provides long-term, low-interest working capital loans to small businesses and non-profit organizations to help them recover from the economic injury caused by a declared disaster.

EIDLs are available in amounts up to $2 million, with interest rates of 4% for small businesses and 2.75% for non-profits, and terms up to 30 years. Loans may be used to pay fixed debts, payroll, accounts payable, and other bills that cannot be paid because of the disaster’s impact.

To be eligible for an EIDL, applicants must have suffered substantial economic injury as a result of the declared disaster, be unable to obtain credit elsewhere, and be located in a disaster area designated by the president. Businesses or non-profits of any size may apply for an EIDL.

The SBA offers disaster assistance in the form of low-interest loans to businesses and homeowners in declared disaster areas.

EIDLs are just one type of disaster assistance available from the SBA. Other types of assistance include:

  • Disaster Grants: grants to cover business expenses that cannot be covered by insurance or other means, such as payroll or inventory;
  • SBA Economic Injury Loans: low-interest working capital loans to help small businesses and non-profits recover from declared disasters; and
  • SBA Physical Disaster Loans: loans to repair or replace real estate, equipment, and machinery damaged or destroyed in a declared disaster.

The SBA also offers counseling, training, and other resources to help small businesses and non-profits prepare for and recover from declared disasters.

PPP and EIDL Loan Fraud Lawyers: Your Guide to Avoiding Trouble

The COVID-19 pandemic led to an unprecedented amount of government assistance for small businesses, including the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) funds from the Small Business Administration (SBA). While these programs threw a lifeline to many businesses impacted by the economic effects of the pandemic, they also opened the door to potential fraud and abuse. Allegations of PPP and EIDL fraud have been rising across the country. As a business owner who received PPP or EIDL funds, you may be worried about facing an audit or charges. Having an experienced lawyer can help you navigate any fraud investigations and protect your business. This guide covers key things to know about PPP and EIDL fraud issues and how a knowledgeable attorney can defend your interests.

Understanding PPP and EIDL Fraud

PPP loans were meant to help businesses keep employees and pay certain expenses during COVID shutdowns. These loans can be forgiven if the money is used for payroll, rent, utilities and other eligible costs. EIDL loans and grants provided working capital to businesses losing revenue due to the pandemic.The rushed loan process and minimal oversight created opportunities for fraud in applications and use of funds. Some common fraudulent activities include:

  • Providing false info on applications like number of employees, payroll, expenses
  • Claiming payroll for fake employees or inflating payroll
  • Using PPP money for personal costs instead of business expenses
  • Getting multiple PPP loans through different lenders (“loan stacking”)
  • Making false statements to get loans forgiven
  • Reselling PPP loan funds received
  • Using stolen identities to apply for fraudulent loans

The Justice Department has increased prosecutions for COVID relief fraud, charging hundreds with PPP and EIDL fraud since 2020. Penalties can include fines up to $1 million and 30 years in prison for major cases. Even application mistakes can be considered fraud if false info was knowingly given.

Responding to SBA Audits or Investigations

Many cases start with an SBA audit of a PPP or EIDL application or forgiveness request. Red flags like inconsistent numbers, questionable documents, and odd spending may trigger an investigation.If contacted by SBA auditors or investigators, business owners should consult a lawyer immediately. An experienced attorney can help craft responses to information requests, assert rights and protections, and avoid self-incrimination.

Fighting PPP or EIDL Fraud Charges

If formally accused of COVID relief fraud, skilled legal counsel is essential. An attorney experienced with federal fraud cases can spot weaknesses in the prosecution’s case and build an aggressive defense. Some potential defenses include:

  • Lack of intent – The prosecution must prove you knowingly gave false information to defraud. Mistakes or misunderstandings may rebut intent.
  • No loss to the government – If PPP funds were used properly or repaid, there may have been no or minimal loss.
  • Duress – External pressures like avoiding bankruptcy may have influenced bad choices.
  • Entrapment – Aggressive sales tactics by lenders could potentially be raised as a defense.

For those facing convictions, minimizing consequences is critical. An experienced lawyer can advocate for:

  • Diversion programs or deferred prosecution to avoid a criminal record
  • Plea bargains to lesser charges to reduce penalties
  • Minimal fines, restitution, and supervised release rather than prison
  • Retaining eligibility for future SBA loans

In some cases, civil settlements with the DOJ can preclude criminal prosecution. Skilled negotiators may also be able to get suspension from federal loan programs rather than outright exclusion, preserving options for the future.

Avoiding Collateral Consequences

Beyond direct penalties, PPP or EIDL fraud convictions can significantly impact finances, career, and reputation. An attorney may help minimize consequences like:

  • Loss of professional licenses and debarment from state and local contracts
  • Difficulties getting business financing
  • Exclusion from industry groups and associations
  • Reputational damage and loss of customers
  • Restricted international travel due to criminal record

Finding the Right Lawyer for Your Situation

Dealing with PPP or EIDL fraud charges can be overwhelming. Engaging an experienced federal criminal defense lawyer is prudent. They can objectively assess your situation, advise on risks, and build the strongest possible case.Look for an attorney who will coordinate with financial experts, accountants, consultants, and other professionals to cover all bases. A team approach combining the right expertise can make a big difference in getting charges reduced or dismissed.The lawyer should thoroughly examine the paper trail and financial records related to your PPP or EIDL application and usage of funds. This enables them to spot inconsistencies, mistakes, and weaknesses in the prosecution’s arguments.An effective attorney will also negotiate aggressively with prosecutors to get charges dropped or plead down to lesser offenses. They know how to craft settlements and alternative resolutions that avoid harsh penalties.For business owners worried about facing fraud allegations, the right lawyer can provide expert guidance and advocacy to resolve the situation with minimal damage. Don’t hesitate to consult an experienced federal defense attorney if you have any concerns about potential PPP or EIDL fraud issues. They have the skills and knowledge to protect your interests.

References

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