Chicago PPP Loan Fraud Lawyers and Attorneys

Last Updated on: 17th December 2025, 02:37 am

Chicago PPP Loan Fraud Lawyers

You think your PPP case is between you and the federal government. One application. One person. One investigation. If they’re looking at you, they’re looking at you. If they’re not, you’re safe.

That’s not how Chicago works.

Welcome to Spodek Law Group. Our goal is to tell you what other websites won’t: the Northern District of Illinois doesn’t prosecute individuals. It prosecutes NETWORKS. The same federal prosecutors who spent decades dismantling Chicago political machines and corruption rings now treat PPP fraud the same way – as organized crime. If your tax preparer helped other people with their applications, you’re all nodes in the same network. When any one of those nodes cooperates with prosecutors, they give up everyone else. You’re connected to people you’ve never met, through one shared person who has every incentive to save themselves.

And in Chicago, with 373 Illinois state workers already found engaged in PPP wrongdoing and 20+ investigations into city employees still ongoing, nobody is exempt. Not police officers. Not commissioners. Not you.

Chicago Prosecutors Think in Networks

Most federal districts prosecute PPP fraud case by case. Find the fraud. Charge the defendant. Convict. Move on. Chicago does something different.

The Northern District of Illinois built its reputation on taking down systems, not individuals. Operation Greylord exposed over 90 corrupt judges and attorneys in the 1980s. Chicago machine politics produced decades of corruption prosecutions. The prosecutors here learned something: individual convictions do not change anything, but dismantling networks does. That institutional knowledge shapes how they approach PPP fraud today.

OK so what does network prosecution mean for your case? It means prosecutors do not just ask “did this person commit fraud?” They ask “who else was involved?” They look at your preparer. They look at your bank. They look at patterns across applications. If your application has the same errors, same language, same bank as dozens of others, you’re part of a pattern. You’re a node. You’re connected.

Here’s how the math works against you. Your tax preparer helped you with your PPP application. They probably helped 10, 20, maybe 30 other people too. If ANY ONE of those other people gets charged and decides to cooperate, prosecutors ask them one question: “Who helped you with the application?” Your preparer’s name comes up. Now the preparer is a target. The preparer’s files become evidence. Every client they helped is suddenly on a list.

The Northern District dosent need to investigate you individually. They investigate the network, and the network leads to you. Thats the system. Thats Chicago.

Here’s something most people don’t understand about the Northern District. The 10-year statute of limitations created by the PPP and Bank Fraud Enforcement Harmonization Act of 2022 means these prosecutors have time. Traditional fraud has a 5-year clock. PPP fraud has 10 years. If you applied in April 2020, your exposed until April 2030. If you applied for forgiveness in 2022 – and many people did – the clock starts from forgiveness. That means exposure until 2032. A full decade of looking over your shoulder while Chicago prosecutors systematicaly work through networks.

They’re not rushing. They’re being methodical. And methodical with a 10-year runway is how you prosecute hundreds of people instead of dozens. The investigation happening right now – the one you do not know about – becomes the indictment in 2026, 2027, 2028. Theres no rush. Theyre building cases. And building cases in the Northern District means building network maps with your name on them.

Your Preparer Is a Cooperating Witness

Maybe you used a professional. A tax preparer. An accountant. A “PPP specialist” who promised fast approval. You figured that protects you – you relied on expert advice, you did not understand the details, you just signed where they told you to sign.

That professional is now either a target or a witness against you. Possibly both.

Farooq Khan owned Hannan Tax Services in Chicago. From May 2020 through October 2021, he prepared and facilitated at least 30 fraudulent PPP and EIDL applications for non-operational companies. The scheme obtained approximately $3.6 million in funded loans. Khan personally took $1.2 million for himself.

He got caught. Sentence: 42 months in federal prison. Plus he was ordered to pay $3,645,104 in restitution. Thats the headline number. But heres the part that actualy affects you.

Before sentencing, Khan had to demonstrate cooperation to get any sentence reduction. Federal prosecutors asked him the same question they ask everyone: “Who else did you help?” He had 30+ applications in his files. Every client name. Every fake payroll number. Every fraudulent certification. All of it documented. All of it handed over.

Your preparer’s files are their evidence. The records you thought proved you used a professional actualy prove exactly what you submitted and who helped you submit it. Your name isn’t anonymous. It’s in a database, connected to a known fraudster, waiting for prosecutors to work their way through the list.

Here’s what practitioners understand that the public dosent. Your preparer’s sentence depends on how many names they give up. Cooperation credit is built into federal sentencing guidelines. The more valuable the information, the bigger the reduction. Their freedom is worth more than your anonymity. They will give you up. Every time.

The question isn’t IF your preparer will cooperate against you. It’s WHEN.

Group Indictments Are the Strategy

Federal prosecutors have a choice. They can charge defendants one at a time, building individual cases. Or they can charge groups together, creating pressure for defendants to flip on each other.

Chicago consistantly chooses groups.

In one indictment, five people were charged together: George Kavroulakis, Athanasios Intzes, Adam Jaber, Hassan Kurdi, and Abdallah Issa. Fraud related to PPP, EIDL, and Pandemic Unemployment Assistance. Multiple counts of wire fraud, each carrying up to 20 years. Five names in one filing.

In another: Dexter M. Crawford Jr., Timika Royston, Orlando Patrick, and Jermie Miller. Four defendants charged together for submitting numerous fraudulent applications from 2020 to 2022.

Why charge groups instead of individuals? Becuase group indictments create a race to cooperate. Each defendant knows that the first person to flip gets the best deal. The second cooperator’s information is worth less. By the third or fourth, prosecutors already have what they need. The leverage comes from everyone knowing that someone in the group will talk.

Think about what this means for you. If you’re connected to anyone else through a shared preparer, shared bank, or shared method, you’re potentialy part of a group. The moment any member of that group gets caught, the race begins. You might not even know who the other members are – you never met them. But you’re all connected through the same node, and the first one to cooperate exposes everyone else.

Heres the part that makes Chicago different from other districts. Other US Attorneys offices might charge defendants separately and build individual cases. Chicago builds the whole network map first. Prosecutors here want to understand the entire structure before they start making arrests. That means by the time you hear about charges, prosecutors already know everyones name. The investigation happened months or years ago. The indictment just makes it official.

The group indictment strategy also affects your defense options. When four or five defendants are charged together, each one has different evidence against them. Some might have bank records. Others might have emails. Some might only be connected through testimony from cooperators. A skilled defense attorney can identify where YOU fit in the network and what specific evidence exists against YOU – as opposed to the general evidence against the group. But you need to understand the network structure to mount an effective defense.

Thats the system Chicago built. It works. And its working against you right now.

Government Workers Aren’t Exempt

You might think federal prosecutors target private sector fraud. Businesses trying to survive COVID. Entrepreneurs who stretched the truth. People outside the system.

Look at what actualy happened in Illinois. 373 state workers were found engaged in PPP wrongdoing. Out of 501 cases investigated by the state inspector general. Thats a 74% misconduct rate among investigated government employees.

It gets worse. The city of Chicago’s inspector general has about 20 long-term investigations into suspected PPP fraud involving city employees that remain open. Active cases. Ongoing investigations. People who thought their government jobs made them untouchable.

Who specificaly? Illinois State Police officers have been implicated. A former assistant commissioner with the Department of Housing was charged with fraudulently obtaining PPP loans. Chicago Police Department members are under investigation. The people who enforce the law thought they were above it. They wernt.

The inspector general investigations are still ongoing. Twenty long-term investigations into city employee fraud. Thats 20 separate cases that havent been resolved yet. Twenty potential cooperating witnesses who might name other people to reduce their own exposure. Twenty more opportunities for the network to expand into new territory. If you know anyone who works for the city and used the same preparer you did, the connection could surface through one of those 20 investigations.

Heres the insight that should concern you. Government employment isn’t a shield – it’s an aggravating factor. When prosecutors charge a police officer or a commissioner with PPP fraud, the implicit message is “they should have known better.” Training and position make the fraud more serious, not less. If judges are willing to prosecute government workers with the full weight of the federal system, private citizens have no protection at all.

If Chicago Police officers aren’t safe from PPP prosecution, what makes you think you are?

What Chicago Sentences Actually Look Like

Let me show you whats actualy happening in the Northern District right now. Not guidelines. Not hypotheticals. Real sentences from real cases.

Farooq Khan – Chicago. Hannan Tax Services owner. 30+ fraudulent applications. $3.6 million scheme. Sentence: 42 months. Restitution: $3,645,104.

Feroz Jalal – Niles suburb. $1.7 million in fraudulent applications. Sentence: 62 months (5 years, 2 months). Restitution: $1.5 million to SBA.

Christopher Scott – Suburban Chicago. $550,000+ in fraudulent loans. Used proceeds for luxury retail purchases. Sentence: 70 months (nearly 6 years). Restitution: $567,333.

Zishan Alvi – Chicago lab owner. $14 million COVID testing fraud. Sentence: 84 months (7 years). Restitution: $14.1 million. Forfeitures: 2021 Range Rover HSE, 2022 Tesla X, 2021 Mercedes-Benz GLB250W4, plus $8 million in cash.

Quamdeen Amuwo – Chicago. $2.9 million fraud. Convicted on all 12 wire fraud counts. Sentence: 66 months (5.5 years).

Heres the pattern that should concern you. Defendants sentenced in 2024 and 2025 are recieving sentences 40% longer than defendants sentenced in 2021 and 2022 for identical conduct. Same fraud amount. Same circumstances. Different year. Harsher sentence. The window for judicial sympathy closed permanantly when judges saw how defendants actualy spent the money.

The luxury purchases don’t just hurt you at sentencing. They become forfeiture. Zishan Alvi didn’t just go to prison – prosecutors took his Range Rover, his Tesla, his Mercedes. Everything you bought with PPP money is evidence of fraudulent intent AND property the government will seize. You lose it either way.

And the restitution survives bankruptcy. Farooq Khan owes $3.6 million that he can’t discharge. He’ll be paying it back for the rest of his life. Wages garnished. Assets subject to seizure. Tax refunds intercepted. The sentence dosent end when prison ends.

Here’s something that surprises most people about federal sentencing in the Northern District. First-time offender status means less than you think. The federal sentencing guidelines for fraud are driven primarily by loss amount, not by your personal history. If you fraudulently obtained $500,000, thats a base offense level that puts you at 5-7 years before any adjustments. Add enhancements for sophistication, for using a financial institution, for number of victims, for obstruction if you deleted evidence – sentences climb rapidly. The hope that being a first-time offender will save you from prison is not grounded in how Chicago federal courts actualy operate.

Theres another pattern emerging from Northern District cases that practitioners recognize. Multiple applications get you in more trouble than single ones. Farooq Khan didn’t submit one fraudulent application – he submitted 30+. The volume demonstrated this wasnt confusion or mistake. It was systematic. Prosecutors use application count as evidence of intent. If you filed multiple PPP applications for different entities, each one is a separate count of bank fraud or wire fraud. Each application is a separate lie. Each lie carries its own potential sentence. The charges stack.

Even the “small” consequences aren’t small. Restitution in federal cases survives bankruptcy. You serve your sentence AND still owe everything when you walk out. The conviction follows you forever – try getting a job, maintaining a professional license, getting a mortgage with federal fraud on your record. Chicago judges don’t show sympathy for COVID desperation arguments anymore. They heard too many defendants claim hardship while the evidence showed luxury purchases.

Why Acting Now Matters More in Chicago

The worst thing you can do is wait. In a network prosecution, waiting means losing.

Your preparer helped other people. Maybe 30 people, like Farooq Khan. Maybe fewer. But unless you were the only client, your connected to others. When any ONE of them gets caught and decides to cooperate, prosecutors ask who helped them. Your preparer’s name comes up. Your preparer gives up everyone they helped to reduce their own sentence. Your name is on a list.

This happens faster than you think. Cooperation credit is a first-mover advantage. The first person to cooperate gets the best deal. The second person’s cooperation is worth less – prosecutors already have some of the information. By the fifth or sixth cooperator, theyre offering scraps. The window shrinks daily.

Think about what this means in practical terms. Pre-indictment cooperation – coming forward before your charged – can affect your bail conditions, your plea offer, AND your sentencing. Three separate leverage points that all get weaker with time. In the Northern District, the difference between pre-indictment cooperation and post-indictment damage control can be 30 months or more. Thats two and a half years of your life that depend on when you pick up the phone.

Network prosecution makes this worse in Chicago. The FBI isn’t just looking at you – theyre looking at everyone connected to you. IRS Criminal Investigation, Homeland Security Investigations, SBA Office of Inspector General – all of them sharing information. Your name shows up in one investigation, it appears in databases across multiple agencies. The walls close from multiple directions simultaniously.

Here’s what practitioners understand that clients don’t. Once the network unravels, it unravels fast. Farooq Khan had 30+ clients. When he cooperated, all 30+ names became targets. Each of those targets faces the same choice: cooperate or fight alone. The ones who cooperate early get the best deals. The ones who wait become the examples. The pattern repeats through every layer of the network.

And in Chicago, with its history of dismantling organized systems, prosecutors are particluarly good at this. They spent decades taking down political machines. They perfected the technique of turning network members against each other. Now theyre applying those same methods to PPP fraud. You’re not dealing with prosecutors who stumbled into fraud cases – your dealing with prosecutors who built careers on exactly this kind of systematic takedown.

At Spodek Law Group, Todd Spodek has handled hundreds of federal fraud cases. The clients who call before the subpoena have options. Voluntary disclosure. Cooperation agreements. Structured restitution. The clients who call after the subpoena arrives are fighting for survival – limiting damage instead of preventing it.

Understanding the Northern District’s network approach changes everything about defense strategy. In other districts, you might negotiate as an individual. In Chicago, you negotiate as part of a structure. Your value as a cooperator depends on who else you can identify. Your exposure depends on who has already identified you. The defense calcuations are fundamentaly different when prosecution flows through networks instead of targeting individuals.

Call 212-300-5196 before someone else in your network does. Not becuase we’re trying to scare you into hiring a lawyer. Becuase in Chicago, with network prosecution and group indictments and 373 government workers already caught, waiting is the most dangerous choice you can make.

Spodek Law Group. The Woolworth Building, 233 Broadway Suite 710, New York. We put this information on our website becuase most people have no idea how exposed they realy are in the Northern District. Our goal isn’t to frighten you. It’s to make sure you understand that Chicago dosent prosecute individuals – it prosecutes networks. And you’re part of one wheather you know it or not.

In Chicago, your preparer’s cooperation is your conviction.