Last Updated on: 28th July 2023, 07:21 pm

The CARES Act has faced criticism for potential opportunities for fraud, due to billions of dollars being disbursed with little oversight. As a result, loan recipients are now being closely scrutinized by federal authorities. If you or your business are under investigation, it’s crucial to seek the guidance of a seasoned federal criminal defense lawyer.

Multiple law enforcement agencies, including the FBI, IRS, and Secret Service, are actively investigating claims of fraudulent PPP loans or SBA EIDL program loans. Anyone targeted for receiving funds illegally faces the risk of criminal indictment and prosecution. Hiring a competent federal criminal defense attorney can help minimize these risks and defend against significant penalties.

But can participating in a government program lead to bank fraud charges? Yes, every federal loan program has legal requirements to prevent fraud, including the Paycheck Protection Program (PPP) and SBA EIDL program. Criminal fraud charges can stem from intentional misrepresentations or even unintentional errors, leading to the wrongful receipt of federal funds.

One common type of fraud being pursued by law enforcement is “loan stacking,” where the same applicant receives multiple loans from multiple lenders. It’s important to prepare a defense carefully, as the receipt of loan funds is easily proven.

Misrepresenting information on a PPP loan application is also a potential red flag for prosecution. Material misrepresentations are false statements that were relied on as true to fund the loan, but were not actually true at the time of funding.

Improper use of loan funds is another area of concern. Funds must be used in accordance with existing guidelines, such as using PPP funds to reimburse payroll costs and benefits, utilities, mortgages and leases. Using the funds for anything other than these designated purposes can result in fraud charges and substantial fines and prison time.

Thwarting a DOJ or SBA Audit Investigation: A Dire Consequence As you navigate through federal investigations by the Department of Justice or other agencies such as the Secret Service, FBI, IRS, or OIG, be aware that they may request information from you or your corporation. This process can be unsettling, with the possibility of subpoenas, search warrants, and interviews looming. But here’s the catch: during this legal procedure, it is imperative to not make false statements or withhold information, or fabricate any facts. Doing so could result in severe consequences, including prosecution for obstructing a lawful investigation.

The Reality of Federal Loan Fraud Prosecution Facing an investigation or prosecution for SBA or PPP loan fraud can be a daunting experience, especially given the complex rules and regulations surrounding federal loan disbursements. But have no fear – our dedicated federal criminal defense law firm is here to help. We specialize in representing individuals and corporations charged with Covid-19 pandemic-related crimes, including bank fraud, federal loan fraud, PPP fraud, and SBA fraud. Don’t let these allegations define your future – contact us today to protect your rights and ensure a favorable outcome.

Amidst the COVID-19 pandemic, the United States Congress responded with force in March 2020 by launching the Paycheck Protection Program (PPP) as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Despite its noble intentions to provide support to small businesses and employees, some individuals have been accused of exploiting the program for their own criminal gains. This is where renowned white-collar defense lawyer Arkady Bukh steps in to assist those facing charges of COVID-19 PPP fraud.

The PPP was designed to offer a lifeline to small businesses grappling with the impact of the pandemic and social distancing measures. Over $660 billion was allocated to provide emergency relief to those struggling to make ends meet. If the conditions of the loan were met, it was forgivable, with the aim of keeping employees on payroll, ensuring continued cash flow, reducing unemployment rates and keeping businesses afloat.

However, as demand for financial relief increased, so did the opportunity for fraud to occur. The stimulus and relief programs have become a hotbed for white-collar crimes, with federal officials taking a strict zero-tolerance stance towards COVID-related crimes. The spread of the disease and its impact on individuals and businesses is a significant concern, and those who attempt to exploit this situation will face serious consequences.