Indiana PPP Loan Fraud Lawyers: Federal Defense in Indianapolis

Indiana PPP Loan Fraud Lawyers: Federal Defense in Indianapolis

The envelope from the U.S. Department of Justice sits on your desk, unopened. Your hands shake slightly as you tear it open—and their it is: a target letter indicating you’re under investigation for PPP loan fraud. Or maybe FBI agents already showed up at you’re business, asking questions about your Paycheck Protection Program application. Either way, your facing serious federal criminal charges that could result in years in prison, massive restitution payments, and the loss of everything you’ve built.

In Indiana, PPP fraud prosecutions are handled by two federal districts: the Northern District (covering Hammond, South Bend, and Fort Wayne) and the Southern District (covering Indianapolis and surrounding areas). Each district operates under different U.S. Attorneys with varying prosecution strategies—and understanding these differences is absolutly critical to your defense.

This comprehensive guide explains what your facing, how the investigation process works, and most importantly, what you need to do right now to protect you’re rights and freedom. Based off our experiance defending PPP fraud cases across Indiana, we’ll walk you through every stage—from the initial investigation to sentencing—and explain defense strategies that can make a real diffrence in the outcome of your case.

Understanding PPP Fraud Charges in Indiana

What Constitutes PPP Loan Fraud?

PPP loan fraud occurs when someone makes false statements or misrepresentations to obtain a Paycheck Protection Program loan they weren’t entitled to recieve. The Small Business Administration (SBA) and Department of Justice have been agressively prosecuting these cases since 2020, and its important to understand exactly what conduct they’re looking at.

Common forms of PPP fraud include:

• Inflated payroll numbers – Exagerating the number of employees or their wages to qualify for a larger loan amount
• False certifications – Claiming your business was operational before February 15, 2020, when it actually wasn’t
• Multiple applications – Applying for PPP loans through several different businesses you control without proper disclosure
• Ineligible business types – Applying when your business didn’t meet eligibility criteria
• Fraudulent use of funds – Spending PPP money on personal expenses rather then allowable business costs
• Forgiveness fraud – Submitting false documentation to get your loan forgiven

Here’s the thing: loan forgiveness fraud is actually seperate from application fraud, and the legal standards are somewhat different. You could of legitimately qualified for a PPP loan but then fraudulently sought forgiveness—or visa versa. Many business owners don’t realize that submitting false documents for forgiveness is a compleatly seperate criminal exposure, even if you’re original application was legit.

The government don’t have to prove you actually recieved the full loan amount or that the bank suffered any losses. Intent is what matters—did you knowingly make false statements with the intent to defraud? That’s the key question prosecutors will be trying to answer.

Federal Statutes and Charges You’re Facing

In Indiana PPP cases, federal prosecutors primarily rely on wire fraud charges under 18 USC 1343. There’s a strategic reason for this preference, and understanding it helps you see what your up against.

18 USC 1343 (Wire Fraud) is the government’s go-to statute because each electronic transmission—every email you sent, every electronic signature, every bank transfer—constitutes a seperate count. If you made five electronic transmissions during your PPP application, that’s potentially five counts, each carrying up to 20 years in federal prison. Prosecutors use this to create leverage for plea negotiations.

The wire fraud statute requires the government to prove:

1. You devised or participated in a scheme to defraud
2. You acted with intent to defraud
3. You used wire communications (email, electronic banking, e-signatures) to further the scheme

Notably, the government doesn’t have to prove the victim (the SBA or lending bank) actually suffered a loss. The fact that you transmitted false information electronically is sufficent—regardless of whether you ultimatley recieved the money or whether the loan was eventually repaid.

Other common charges in Indiana PPP cases include:

18 USC 1001 (False Statements) – Making false statements to a federal agency. Unlike wire fraud, this doesn’t require proof of a scheme or intent to defraud—just knowingly false statements to a government entity. Maximum penalty: 5 years per count.

18 USC 371 (Conspiracy) – Agreeing with one or more persons to commit fraud. The conspiracy charge don’t require that the fraud was actually completed—just that you agreed to do it and someone took an overt act toward completing it. This charge is often added when multiple defendants is involved, such as business partners or accountants. Maximum penalty: 5 years.

18 USC 1344 (Bank Fraud) – Defrauding a financial institution. Although PPP loans was processed through banks, prosecutors typically prefer wire fraud charges because its easier to prove and carries a longer maximum sentance.

Bottom line: wire fraud is the workhorse of PPP prosecutions because it’s versatile, carries steep penalties, and provides prosecutors with multiple counts to stack up.

Recent Indiana PPP Prosecutions: What We’re Seeing

The Northern and Southern Districts of Indiana has been activly prosecuting PPP fraud cases since late 2020. One recent case illustrates the typical trajectory of these prosecutions.

In September 2025, a Winfield woman was ordered to repay funds from her PPP loan and sentenced to 12 months in prison after pleading guilty to wire fraud. Acting U.S. Attorney M. Scott Proctor announced the sentencing, which included full restitution plus interest—a total exceeding the original loan amount by approximately 40%.

This case demonstrates several important points:

• The DOJ is pursuing cases well below the $2 million “audit threshold”
• Even first-time offenders with no criminal history is recieving prison time
• Restitution amounts frequently exceed the original loan
• Plea agreements are the norm—very few PPP cases actually goes to trial

We’re seeing differences between the two Indiana districts, too. The Southern District (Indianapolis) handles higher volumes of white-collar cases due to the concentration of corporate headquarters in the Indianapolis metro area. Judges in the Southern District has developped considerable expertise in sentencing fraud defendants and calculating loss amounts under the federal sentencing guidelines.

The Northern District (Hammond/South Bend), with it’s proximity to Chicago, tends to follow prosecution patterns similar to the Northern District of Illinois—which has historically been one of the most agressive federal districts for white-collar prosecutions. Hammond federal prosecutors often coordinate with Chicago-based FBI agents and maintain close ties to that legal culture.

Venue matters. Where you’re case is prosecuted can significently affect everything from pretrial release conditions to sentencing outcomes.

The Investigation Process in Indiana

How PPP Fraud Investigations Begin

Most defendants don’t realize their under investigation until agents show up or they recieve a grand jury subpoena. But these investigations typically begin months—sometimes over a year—before any contact with the target. Understanding how investigations start gives you insight into what evidence the government likely already has.

SBA Office of Inspector General (OIG) Audits

The SBA OIG is tasked with identifying fraud in the PPP program. They conduct both random audits and targeted investigations based off red flags in loan applications. Red flags include:

• Payroll numbers that don’t match IRS tax filings
• Businesses with no online presence or operational history
• Identical application information across multiple borrowers
• Suspicious use of funds (luxury purchases, transferring money overseas)
• Multiple loans to affiliated businesses without proper disclosure

When SBA OIG identifies potential fraud, they have the authority to refer the case to the FBI and DOJ for criminal prosecution. These civil audits can quickly become criminal investigations—often without the borrower realizing the transition has occured.

Bank Suspicious Activity Reports (SARs)

Federal law requires banks to file Suspicious Activity Reports with the Financial Crimes Enforcement Network (FinCEN) when they detect transactions that appear unusual or potentially criminal. Banks that processed PPP loans was required to monitor how borrowers used the funds.

Common triggers for SARs in PPP cases:

• Immediate withdrawal of most of the loan in cash
• Transferring funds to personal accounts or overseas
• Luxury purchases shortly after loan disbursement
• Payments to entities unrelated to payroll or business expenses

Once a SAR is filed, it goes directly to federal law enforcement. You won’t be notified—in fact, its illegal for the bank to tell you a SAR was filed. By the time investigators contact you, they’ve likely already obtained you’re bank records, tax returns, and other financial documents.

IRS Cross-Referencing

The IRS Criminal Investigation Division has been comparing PPP loan applications against tax returns. If you claimed 25 employees and $500,000 in payroll on you’re PPP application but your 2019 tax returns show only 5 employees and $100,000 in payroll, that discrepancy will get flagged.

These automated systems has flagged thousands of applications, and investigators prioritize cases with the most egregious descrepencies.

Whistleblower Qui Tam Lawsuits

This is something alot of defendants don’t see coming. Under the False Claims Act, whistleblowers can file lawsuits on behalf of the government alleging fraud. If the government recovers money, the whistleblower recieves 15-30% of the amount recovered.

Who becomes whistleblowers? We’re seeing:

• Former employees who know the payroll numbers was inflated
• Business partners involved in disputes
• Ex-spouses and family members
• Accountants and bookkeepers who prepared applications

These qui tam cases often run parrallel to criminal investigations. Sometimes the civil case comes first, and federal prosecutors use the whistleblower’s evidence to build a criminal case. Other times, the criminal investigation leads to a whistleblower filing a civil lawsuit to get a piece of any restitution or forfeiture.

The financial insentive is significant—15-30% of recovered funds can mean hundreds of thousands of dollars. This has created a cottage industry of whistleblower cases, and Indiana has seen a sharp increase since 2023 as the statute of limitations (6 years for civil fraud) approaches.

The SBA Audit Threshold: Seperating Myth from Reality

One of the most dangerous misconceptions about PPP fraud is the so-called “$2 million safe harbor.” Heres what business owners need to understand: this threshold applies to SBA administrative audits, not criminal investigations.

The SBA created a safe harbor stating that loans under $2 million would be presumed to have been made in good faith regarding the economic neccessity certification. This means the SBA wouldn’t second-guess whether your business truly needed the loan for economic uncertainty caused by COVID-19—if the loan was under $2 million.

But this “safe harbor” has created a false sense of security. It does NOT protect you from criminal prosecution if:

• You made false statements on your application (inflated payroll, fake employees)
• You misused the funds for personal expenses
• You submitted fraudulent forgiveness documentation
• You was ineligible for the program but applied anyway

The Winfield case proves this point—the loan amount was well under $2 million, yet the defendant recieved 12 months in federal prison. The DOJ and FBI don’t care about the safe harbor when their’s evidence of intentional fraud.

In fact, investigators sometimes target smaller loans precisely because defendants assumed they was flying under the radar. A $20,000 loan obtained through blatent fraud is still wire fraud—and the 20-year maximum sentance is the same regardless of the amount.

The audit threshold also don’t protect you from:

• Whistleblower qui tam lawsuits
• Bank referrals based off suspicious activity
• IRS Criminal Investigation referrals
• Multi-agency task force investigations

So if your counting on the $2 million threshold to protect you—don’t. Its not a shield against criminal prosecution.

Multi-Agency Investigations: Who’s Looking at You

PPP fraud investigations typically involves multiple federal agencies working together. Understanding whose involved and there roles helps you know what to expect.

SBA Office of Inspector General (OIG)

The SBA OIG conducts audits and investigations of SBA programs, including PPP loans. SBA OIG special agents has law enforcement authority—they can execute search warrants, make arrests, and carry firearms. However, they often work in coordination with the FBI rather then pursuing cases independantly.

If SBA OIG agents contact you for an interview, understand that your already under criminal investigation, not just an administrative audit. Anything you say can and will be used against you in criminal proceedings.

Federal Bureau of Investigation (FBI)

The FBI takes the lead on most PPP fraud investigations, especially cases involving more then $100,000 or multiple defendants. FBI agents will typically:

• Interview witnesses, including employees, accountants, and business associates
• Execute search warrants for business and personal records
• Conduct surveillance
• Coordinate with prosecutors to present evidence to grand juries

In Indiana, FBI field offices in Indianapolis, Merrillville (Hammond area), and Fort Wayne handle PPP investigations for their respective areas.

IRS Criminal Investigation (CI)

IRS CI agents are the financial investigators of the federal government. When PPP fraud involves tax fraud, money laundering, or complex financial transactions, IRS CI often gets involved. These agents are experts at tracing money, analyzing financial records, and identifying descrepancies between tax filings and loan applications.

If IRS CI is involved in you’re case, expect a extremly detailed financial analysis. These agents will reconstruct you’re entire financial picture—and they’re very good at it.

U.S. Attorney’s Office

Ultimately, Assistant U.S. Attorneys (AUSAs) in the Northern or Southern District decide whether to bring charges. They work closly with investigators throughout the process, reviewing evidence, issuing grand jury subpoenas, and ultimately presenting the case to a grand jury for indictment.

The timeline from initial investigation to indictment varies widely, but typically:

• Months 1-6: Covert investigation—obtaining bank records, tax returns, loan documents
• Months 6-12: Overt investigation—interviewing witnesses, executing search warrants
• Months 12-18: Target notification—target letters, cooperation discussions
• Months 18-24: Grand jury and indictment

However, some cases move much faster, especially if there’s a cooperating witness or whistleblower providing evidence.

Target Letters and Grand Jury Subpoenas: Recognizing Escalation

A target letter is the DOJ’s way of notifying you that your the subject of a criminal investigation and that prosecutors intend to seek an indictment. Recieving a target letter means:

• The investigation is in it’s final stages
• Prosecutors has reviewed the evidence and beleive they can prove a crime
• You have a narrow window (usually 30-60 days) to respond before indictment

Target letters typically invite you to come in for a voluntary interview or to provide a written response. Do not respond without consulting a federal criminal defense attorney first. Anything you say—even in a “proffer session” intended to persuade prosecutors not to charge you—can be used against you if your ultimately indicted.

Grand jury subpoenas are court orders commanding you to produce documents or testify before the grand jury. If you recieve a subpoena:

• You must comply (ignoring a subpoena is contempt of court)
• You have the right to consult an attorney before responding
• You can assert your Fifth Amendment right against self-incrimination if testifying
• A subpoena for documents requires you to produce them, but an attorney can review them first and potentially challenge overbroad requests

Sometimes, prosecutors issue subpoenas to your accountant, bookkeeper, employees, or business partners before contacting you directly. If you learn that others has recieved subpoenas about your business, thats a strong indication your under investigation.

Pre-Indictment Defense Strategies: The Critical Window

Why the First 30-60 Days Matter More Then You Think

Heres something alot of people don’t realize: the most important phase of your defense isn’t the trial—its the pre-indictment window. Once your formally charged, you’re options narrow considerably. But before indictment, theres still a chance to convince prosecutors not to charge you at all.

The problem is, this window is narrower then most people think. By the time you recieve a target letter, prosecutors has typically already:

• Obtained you’re bank records going back years
• Compared your PPP application against tax returns
• Interviewed witnesses, including employees and associates
• Calculated the alleged loss amount
• Reviewed the case with supervisors
• Made a prelimenary determination that charges are warrented

Your working against momentum. The government has invested considerable resources in building the case, and prosecutors don’t send target letters lightly. But that doesn’t mean its hopeless—far from it.

Successfull pre-indictment intervention requires moving quickly and strategicly. You typically have 30-60 days before the case goes to the grand jury. During this critical window, experienced defense counsel can:

• Conduct an independant investigation to identify evidence the government may not have
• Retain forensic accountants to challenge loss calculations
• Interview potential witnesses before the government does
• Prepare a pre-indictment memorandum presenting exculpatory evidence
• Negotiate voluntary restitution to demonstrate good faith
• In rare cases, arrange a proffer session to provide your side of the story

The goal is to create doubt in the prosecutor’s mind—not about whether errors occurred, but about whether you had criminal intent. Were you relying on professional advice? Did you reasonably interpret ambiguous guidance? Was the discrepancy a result of accounting methods rather then deliberate fraud?

Look, Im not gonna lie to you—securing a declination (prosecutor’s decision not to charge) is difficult. But its not impossible, and the effort is worthwhile because the alternatives is so much worse.

Should You Cooperate with Investigators? The Double-Edged Sword

One of the hardest decisions you’ll face is whether to cooperate with federal investigators. The stakes is high, and theres no universal right answer—it depends on you’re specific situation.

Your Fifth Amendment Rights

You have an absolute right to remain silent. You cannot be punished for asserting this right, and prosecutors cannot comment on it at trial. If agents approach you for an interview, you can (and often should) decline and refer them to your attorney.

However, here’s the complication: declining to cooperate can make it harder to convince prosecutors not to charge you. If your defense is that the whole thing was a misunderstanding—that you relied on your accountant, misunderstood the requirements, or made an honest mistake—then remaining silent may undermine that narrative.

The Risks of Unrepresented Interviews

Never, ever speak to federal agents without an attorney present. I cannot stress this enough. Federal agents are skilled interrogators, and even innocent people makes statements that sounds incriminating.

Heres what can happen:

• You think you’re explaining an honest mistake, but agents interpret it as admission of knowledge
• You misremember a detail, and it later becomes a false statement charge (18 USC 1001)
• You provide information that contradicts what a witness said, making you look like your lying
• You inadvertantly disclose something that opens up new lines of investigation

Agents will often say “we just want to hear your side” or “this is your chance to clear things up.” Don’t be fooled. Their job is to build a case, not to exonerate you. Anything you say can—and likely will—be used against you.

Cooperation Through Counsel

If cooperation is strategicly appropriate, it should be done through counsel in a structured setting. This typically means:

• Proffer sessions – Meetings where your attorney presents information to prosecutors, sometimes with you present to answer specific questions
• Written submissions – Pre-indictment memoranda laying out exculpatory evidence without the risks of oral statements
• Limited waivers – Agreements where you provide specific information but prosecutors cannot use it against you (except to impeach you if you testify differently at trial)

Full Cooperation and Its Consequences

In some cases, full cooperation with the government is the best strategy—particularly if:

• The evidence against you is overwhelming
• You have information about more culpable co-conspirators
• Your seeking a cooperation agreement that could result in substantial sentence reduction

But understand what “full cooperation” means. It requires:

• Complete disclosure of ALL financial dealings, not just PPP-related activity
• Testifying against co-defendants if required
• Submitting to polygraph examinations
• Continuing cooperation through trial and sentencing

Full cooperation can expose unrelated issues—tax problems, other business dealings, activities of family members or business partners. Once you start down this path, you cannot selectively cooperate. Its all or nothing, and prosecutors will verify everything you tell them. If they catch you in a lie or omission, the cooperation agreement is off, and your statements can be used against you.

The decision to cooperate must be made with full understanding of these ripple effects and only after consulting with experienced counsel.

Pre-Indictment Memoranda: Making Your Case Before Charges

A pre-indictment memorandum is a formal written submission to prosecutors presenting evidence and legal arguments for why charges shouldn’t be brought. When done correctly, these memoranda can be powerful tools—but they require careful strategy and execution.

The Purpose and Strategy

The goal isn’t to argue that you did nothing wrong—prosecutors already beleive otherwise. Instead, the memorandum should:

• Present evidence that creates reasonable doubt about criminal intent
• Provide context the government may be missing
• Demonstrate that your case doesn’t warrant federal resources
• Offer voluntary restitution or remedial measures
• Distinguish your conduct from typical fraud cases

Effective memoranda often include:

• Expert opinions from accountants explaining how descrepencies arose
• Documentation of reliance on professional advice
• Evidence of actual eligibility for some or all of the loan
• Proof of legitimate business expenses that correspond to loan use
• Personal history and circumstances (first offense, community ties, health issues)

Working with Forensic Accountants

In PPP cases, forensic accountants is often essential during the pre-indictment phase. They can:

• Reconstruct financial records to show legitimate expenses
• Challenge the government’s loss calculation
• Explain technical accounting issues that may have led to errors
• Provide expert opinions on industry standards and practices

For example, if prosecutors allege you inflated payroll by $200,000, a forensic accountant might demonstrate that:

• The discrepency resulted from including contractor payments that are legitimately part of payroll calculations
• Different accounting methods explain the diffrence between tax returns and the application
• Your actually entitled to $150,000 of the loan, making the alleged fraud much smaller

Reducing the loss amount is critical because federal sentencing is primarily driven by loss calculations. The diffrence between a $50,000 fraud and a $200,000 fraud is several years of prison time.

Documenting Good Faith

Perhaps the most important element of a pre-indictment memorandum is demonstrating good faith. Criminal fraud requires intent—so if you can show you reasonably beleived your actions was lawful, you negate criminal intent.

Evidence of good faith includes:

• Emails with accountants or attorneys seeking advice on PPP applications
• Documentation showing you researched PPP requirements
• Evidence you followed industry practices or guidance
• Proof you corrected errors once discovered
• Bank records showing legitimate business use of funds

The key is showing that while errors may have occured, they was not the result of a deliberate scheme to defraud the government.

Defense Strategies After Indictment

Challenging the Evidence: Available Defenses

If your indicted, you’re facing an uphill battle—federal conviction rates exceed 90%. But that doesn’t mean you should just plead guilty and hope for the best. Depending on the specific facts of you’re case, several defenses may be available.

Lack of Criminal Intent

This is the most common—and most difficult—defense in PPP fraud cases. Wire fraud requires proof that you acted with intent to defraud. If you can show you reasonably beleived your statements was truthful, you negate this element.

However, here’s the challenge: PPP applications required explicit certifications. You electronically signed documents stating that you reviewed the information, it was accurate, and you understood the penaltys for false statements. Courts has been skeptical of defendants who claim they “didn’t understand” requirements that was clearly stated in the application form they signed.

The good-faith defense has limited traction in PPP cases for this reason. But it can still be effective if:

• You relied on professional advice from accountants or attorneys
• The guidance from SBA was genuinely ambiguous, and you’re interpretation was reasonable
• Errors resulted from technical accounting issues rather then deliberate falsification

You’ll need expert witnesses—accountants, PPP program experts—to testify that your interpretation was within the range of reasonableness.

Challenging Loss Amount Calculations

Even if you can’t avoid conviction entirely, challenging the government’s loss calculation is critical because it drives sentencing. The federal sentencing guidelines use a loss table where each increase in loss corresponds to several additional points on your offense level—and each point translates to months of additional prison time.

The government calculates loss as the diffrence between what you recieved and what you was entitled to. So if you recieved a $100,000 loan but was legitimately entitled to $60,000, the loss is $40,000—not $100,000.

Your forensic accountant will be critical here. They can argue that:

• Certain expenses was legitimate and should be counted
• The government’s methodology is flawed
• Industry standards support your calculations
• The actual loss was lower then the intended loss

Judges has substantial discretion in determining loss amounts, and a vigorous challenge can often reduce the loss by tens or hundreds of thousands of dollars—which translates to years off your sentance.

Attacking Sufficiency of Wire Fraud Proof

Remember, wire fraud requires three elements: (1) a scheme to defraud, (2) intent to defraud, and (3) use of wire communications to further the scheme. Defense attorneys can attack each element.

For example:

• Was the alleged “scheme” just a series of mistakes rather then a coordinated plan?
• Did the wire communications (emails, e-signatures) actually further the fraud, or was the fraud complete before those communications?
• If you repaid the loan before any investigation began, does that negate intent to cause loss?

These technical arguments rarely results in complete acquittal, but they can lead to dismissal of certain counts or create reasonable doubt on specific elements.

Negotiating Plea Agreements: Understanding Your Options

More then 95% of federal criminal cases end in plea agreements rather then trials. For most PPP fraud defendants, negotiating the best possible plea is the realistic path forward.

Acceptance of Responsibility

Under the federal sentencing guidelines, defendants who accept responsibility for their conduct recieves a three-point reduction in their offense level—which typically translates to 6-12 months less prison time. To qualify, you must:

• Plead guilty
• Not minimize your conduct or blame others
• Provide truthful information about the offense

However, you don’t have to plead guilty at the earliest opportunity. You can still receive acceptance of responsibility even if you engaged in pre-trial motion practice or negotiated for weeks, as long as you eventually plead guilty and accept what you did.

Cooperation Agreements and Substantial Assistance

If you provide substantial assistance to the government—typically by testifying against co-defendants or providing information leading to other prosecutions—prosecutors can file a motion for downward departure under U.S.S.G. § 5K1.1 or 18 USC § 3553(e).

These motions allows judges to sentence you below the guideline range, sometimes dramatically so. Cooperation can result in 50% or more reduction in sentence—but it comes at a price:

• You’ll likely have to testify against former business partners or associates
• Your cooperation will become public knowledge
• Co-defendants may retaliate civilly or damage your reputation
• You must continue cooperating through trial, which can take years

Cooperation agreements are complicated, and the decision to cooperate shouldn’t be made lightly or without counsel.

Charge Bargaining

In some cases, prosecutors will agree to reduce charges as part of a plea agreement. For example:

• Reducing wire fraud (20-year max) to false statements (5-year max)
• Dismissing conspiracy counts
• Agreeing to cap the loss amount at a specific figure

The benefit of charge bargaining is that it limits your maximum exposure and can reduce the guideline range. However, federal judges aren’t bound by the parties’ sentencing recommendations—they can still impose any sentance within the statutory maximum.

Fact Stipulations and Guideline Disputes

Even after pleading guilty, you has the right to dispute specific facts that affect sentencing. Common disputes include:

• The loss amount
• Whether you played a leadership role (adds points)
• Whether the offense involved sophisticated means (adds points)
• The number of victims (more than 10 victims adds points)

At sentencing, the judge will hold an evidentiary hearing to resolve disputed facts. Both sides can present evidence and call witnesses. Winning these disputes can significantly reduce you’re guideline range.

Proceeding to Trial: When It Makes Sense

Trials are rare in federal PPP cases—but sometimes they’re the right choice. You should consider going to trial if:

• The government’s evidence of intent is weak
• You has strong exculpatory evidence
• The plea offer is so harsh that trial offers little additional risk
• You genuinely beleive you’re innocent and are willing to accept the consequences if the jury disagrees

Jury Selection

Federal jury selection (voir dire) is more limited then state court. Judges typically asks most questions, though attorneys can submit proposed questions and sometimes conduct limited questioning themselves.

In PPP fraud cases, key voir dire issues include:

• Jurors’ attitudes toward COVID-related programs and fraud
• Experience with small business ownership or PPP loans
• Ability to presume innocence despite charges
• Understanding that good people can make mistakes without criminal intent

Government Burden of Proof

The government must prove every element beyond a reasonable doubt. In PPP cases, intent is usually the weakest element. Your defense will focus on creating reasonable doubt about whether you knowingly engaged in fraud versus making mistakes or relying on professional advice.

Expert Witnesses

Defense expert witnesses can be critical. Potential experts include:

• Forensic accountants to challenge loss calculations and explain accounting methods
• PPP program experts to testify about ambiguous guidance and reasonable interpretations
• Industry experts to explain standard practices in your business sector

Should You Testify?

This is one of the most difficult decisions in any criminal trial. If you testify:

• Pros: You can tell your side of the story, explain your intent, humanize yourself to the jury
• Cons: Prosecutors will cross-examine you agressively, any prior inconsistencies will be highlighted, you might inadvertantly say something damaging

The decision depends on how well you handle pressure, whether your prior statements creates problems, and whether the government’s case can be defeated without your testimony.

Federal Court Procedures in Indiana

Northern District vs. Southern District: Understanding the Differences

Indiana is divided into two federal judicial districts, and where you’re case is prosecuted can significantly affect the outcome.

Southern District of Indiana (Indianapolis)

The Southern District covers Indianapolis and most of central and southern Indiana. The main courthouse is in downtown Indianapolis, with additional courthouses in Terre Haute, Evansville, and New Albany.

Characteristics:

• Handles high volumes of white-collar cases due to corporate concentration in Indianapolis
• Judges has considerable experience with fraud sentencing and guideline calculations
• U.S. Attorney’s Office has dedicated white-collar section
• Generally follows sentencing guidelines fairly closely

The Southern District prosecutes more PPP cases simply because more businesses is based their. If you’re business is in the Indianapolis metro area, your case will likely be in the Southern District.

Northern District of Indiana (Hammond/South Bend/Fort Wayne)

The Northern District covers the northern third of Indiana, with courthouses in Hammond, South Bend, and Fort Wayne.

Characteristics:

• Hammond division has close ties to Chicago federal prosecutors and often follows similar prosecution patterns
• South Bend handles cases from the South Bend/Elkhart area and northern counties
• Fort Wayne covers northeastern Indiana
• Generally regarded as slightly more prosecution-friendly then Southern District

The proximity to Chicago means Northern District prosecutors sometimes coordinate with the Northern District of Illinois, which is one of the most agressive federal districts in the country for white-collar prosecutions.

Judges and Sentencing Tendencies

Individual judges matter. Some judges consistently sentence at the low end of the guideline range, while others tends toward the high end. Experienced federal defense attorneys knows the tendencies of each judge and can tailor arguments accordingly.

For example, some judges are particularly receptive to mental health mitigation, while others focuses more on deterrence and the seriousness of the offense. Understanding your assigned judge is critical to sentencing strategy.

Initial Appearance and Arraignment: What to Expect

If your indicted, you’re first court appearance will be either an initial appearance (if arrested) or an arraignment (if you surrender voluntarily or recieve a summons).

Magistrate Judge Proceedings

Initial appearances is typically conducted by magistrate judges, who are appointed by district judges to handle certain procedural matters. At the initial appearance:

• You’ll be advised of the charges
• You’ll be advised of your rights
• The court will determine pretrial release conditions
• You’ll be appointed counsel if you cannot afford an attorney

Bail and Release Conditions

In white-collar cases like PPP fraud, defendants are usually released on bond rather then detained pretrial. The Bail Reform Act presumes you should be released unless the government shows your a flight risk or a danger to the community.

For PPP fraud cases, typical release conditions include:

• Signature bond or unsecured bond (no money required, but you owe the amount if you don’t appear)
• Surrender of passport and agreement not to apply for new travel documents
• Restrictions on travel outside the district (must get permission for any travel)
• Regular check-ins with pretrial services
• No contact with co-defendants or witnesses
• In some cases, GPS monitoring or home detention

If the loan amount was very large or if prosecutors believe your a flight risk, they may seek detention or more restrictive conditions like house arrest.

Arraignment

Arraignment is the formal reading of charges and entry of your plea. You’ll plead either guilty, not guilty, or (rarely) no contest. Almost all defendants plead not guilty at arraignment, even if they intend to later plead guilty. This preserves your rights and gives your attorney time to negotiate.

Discovery and Motion Practice

After arraignment, the case enters the pretrial phase, which typically lasts 4-8 months (though it can be longer or shorter depending on the complexity).

Discovery

Federal discovery is governed by Federal Rule of Criminal Procedure 16 and the Jencks Act. The government must provide:

• Your statements to law enforcement
• Your prior criminal record
• Documents and tangible objects material to the defense
• Results of scientific tests or examinations

Additionally, under Brady v. Maryland, prosecutors must disclose evidence favorable to the defense, including:

• Evidence of innocence
• Impeachment evidence (info showing witnesses are not credible)
• Evidence that undermines key elements of the offense

In PPP cases, discovery typically includes:

• Your PPP loan application and all supporting documents
• Bank records for business and personal accounts
• Tax returns
• Communications with lenders, accountants, and business partners
• Witness interview reports (FBI 302s)
• Expert reports on loss calculations

Common Pretrial Motions

Your attorney may file various pretrial motions, including:

• Motion to Dismiss – Arguing the indictment is legally insufficient
• Motion to Suppress Evidence – Arguing evidence was obtained illegally (e.g., through an invalid search warrant)
• Motion for Bill of Particulars – Requesting more specific information about the charges
• Motion to Sever – If charged with co-defendants, requesting separate trials

Motions to dismiss is rarely granted in federal court, but they serve important purposes: they narrow the issues, create a record for appeal, and sometimes convince prosecutors to reduce charges.

Sentencing Considerations: What You’re Really Facing

Federal Sentencing Guidelines: How Your Sentence Is Calculated

Federal sentencing is primarily governed by the United States Sentencing Guidelines. While the guidelines is advisory (not mandatory) after United States v. Booker, judges still consult them as the starting point for every sentence.

Base Offense Level

For fraud offenses like wire fraud, the base offense level is 6 or 7. But this is just the starting point—the real driver of your sentance is the loss amount.

Loss Amount Table

The guidelines contain a loss table (U.S.S.G. § 2B1.1) that adds points to your offense level based on the loss:

• Loss less than $6,500: +0 points
• $6,500-$15,000: +2 points
• $15,000-$40,000: +4 points
• $40,000-$95,000: +6 points
• $95,000-$150,000: +8 points
• $150,000-$250,000: +10 points
• $250,000-$550,000: +12 points
• $550,000-$1.5 million: +14 points
• $1.5-$3.5 million: +16 points

The table continues up to losses over $550 million. Each 2-point increase generally corresponds to about 6-12 months of additional prison time.

Enhancements

The guidelines add additional points for aggrevating factors:

• More than 10 victims: +2 points (In PPP cases, the SBA is one victim, the lending bank is another, and the government sometimes argues that taxpayers or other PPP applicants are additional victims)
• Sophisticated means: +2 points (Using fake documents, shell companies, or complex schemes)
• Leadership role: +2 to +4 points (If you organized or led the fraud scheme)
• Abuse of position of trust: +2 points (If you held a position that gave you special access—like a bank employee)

Reductions

You can also receives reductions:

• Acceptance of responsibility: -3 points (if you plead guilty and don’t minimize your conduct)
• Minor or minimal role: -2 to -4 points (if you was a peripheral participant)

Criminal History Category

Your criminal history is scored separately on a I-VI scale:

• Category I: No prior record
• Category II-VI: Increasing criminal history

Most first-time PPP fraud defendants is Category I.

Calculating the Guideline Range

Once you has your total offense level and criminal history category, you consult the sentencing table. For example:

• Offense Level 18, Criminal History I: 27-33 months
• Offense Level 20, Criminal History I: 33-41 months
• Offense Level 22, Criminal History I: 41-51 months

Lets walk through a typical calculation for a PPP fraud case:

• Base offense level: 7
• Loss of $200,000: +10 points
• More than 10 victims: +2 points
• Sophisticated means (fake documents): +2 points
• Acceptance of responsibility: -3 points
• Total offense level: 18
• Criminal History: I
• Guideline range: 27-33 months

If that loss amount was challenged and reduced to $100,000, the offense level drops to 16, and the guideline range becomes 21-27 months—a reduction of 6 months minimum.

This is why aggressively challenging loss calculations is so critical. Even small reductions in the loss amount can translate to months or years off your sentence.

Statutory Maximums and Mandatory Minimums

Federal sentencing statutes set maximum (and sometimes minimum) penalties for each offense. In PPP fraud cases:

Wire Fraud (18 USC 1343)

• Maximum: 20 years per count
• No mandatory minimum
• If the fraud affects a financial institution, maximum increases to 30 years

False Statements (18 USC 1001)

• Maximum: 5 years per count
• No mandatory minimum

Conspiracy (18 USC 371)

• Maximum: 5 years
• No mandatory minimum

Because their’s no mandatory minimums for these offenses, judges has discretion to sentence below the guidelines or even impose probation in extraordinary circumstances. However, sentences below the guideline range is rare and typically require substantial mitigation.

Consecutive vs. Concurrent Sentences

If your convicted of multiple counts, the judge can impose sentences to run concurrently (at the same time) or consecutively (one after another).

In PPP cases, judges almost always impose concurrent sentences—meaning if your convicted of five counts of wire fraud, you serve one sentence, not five. This is standard practice unless the counts involves separate victims or distinct schemes.

Restitution Requirements: It’s Not Just Prison Time

Under the Mandatory Victims Restitution Act (MVRA), federal judges must order restitution in fraud cases. This means you’ll be required to repay the full amount of loss to the victims—regardless of whether you still have the money.

How Restitution Is Calculated

Restitution equals the victim’s actual loss. In PPP cases:

• If you recieved a $100,000 loan and was entitled to $0, restitution is $100,000
• If you recieved $100,000 and was entitled to $60,000, restitution is $40,000

Restitution often exceeds the original loan amount because it can include:

• Interest from the date of disbursement
• Government investigation costs (FBI agent time, forensic accounting)
• Administrative expenses

We regularly see restitution orders that is 150-200% of the original loan amount.

Payment Schedules and Modification

If you cannot pay restitution immediately (which most defendants can’t), the court will establish a payment schedule—typically a monthly payment during your supervised release period.

For example, if restitution is $200,000 and you’re on supervised release for 3 years, the court might order payments of $5,000 per month. If you cannot afford that, you’ll need to demonstrate your financial situation, and the court may reduce the monthly amount.

However, the restitution obligation don’t go away. Even after supervised release ends, you still owes the full amount. The government can enforce restitution through wage garnishment, tax refund interception, and other collection methods—just like a civil judgment.

Restitution vs. Guideline Loss Amount

Importantly, the restitution amount and the guideline loss amount can be different. The guideline loss includes intended loss even if not completed, while restitution covers only actual loss. This creates strategic opportunities—you might argue for a lower restitution amount while accepting a higher guideline loss (or vice versa).

Alternative Sentencing Options

While most PPP fraud defendants recieves some prison time, alternatives is available in lower-loss cases or where substantial mitigation exists.

Probation

Federal judges can impose probation instead of prison if:

• The guideline range is in Zone A or B (offense level 8 or below)
• The judge finds extraordinary circumstances justifying a variance from the guidelines

Probation is rare in PPP cases because the loss amounts typically push offense levels above Zone B. However, if the loss is under $40,000 and you has no enhancements, probation might be possible.

Home Detention

For offense levels in Zone C (typically 9-11), judges can impose split sentences—part prison, part home detention. Home detention requires:

• GPS monitoring
• Permission to leave only for work, medical appointments, religious services, and court-approved activities
• Random compliance checks

Home detention is often used when health issues makes prison placement problematic or when family circumstances (caring for dependents) justifies keeping you in the community.

Halfway House Placement

Even if sentenced to prison, you can request that the Bureau of Prisons places you in a Residential Reentry Center (halfway house) for part of your sentence—typically the last 6-12 months. This allows you to work in the community while serving the remainder of your sentance.

Cooperation Departures

If you provided substantial assistance to the government, prosecutors can file a 5K1.1 motion (or 18 USC 3553(e) motion for cases involving mandatory minimums, though that doesn’t apply to PPP fraud). These motions allows judges to sentence below the guideline range—sometimes substantially below.

Cooperation departures can results in 40-50% reductions or more, depending on the value of your cooperation. In extraordinary cases, cooperating defendants has recieved probation even when the guidelines called for years in prison.

Collateral Consequences: Beyond Prison and Restitution

Professional Licenses in Indiana: Protecting Your Livelihood

For many defendants, the collateral consequences of a PPP fraud conviction is more devastating then the criminal penalty itself. Professional licenses is particularly vulnerable.

Indiana Licensing Boards

Indiana professional licensing boards treats federal fraud convictions as automatic grounds for discipline. Affected professions include:

• Attorneys – Indiana Supreme Court Disciplinary Commission treats federal fraud convictions as serious professional misconduct. Even a deferred prosecution agreement or pretrial diversion can trigger suspension or disbarment proceedings.
• Accountants (CPAs) – Indiana Board of Accountancy considers fraud convictions as grounds for license revocation, particularly when the fraud involves financial misrepresentation.
• Real Estate Brokers – Indiana Real Estate Commission views fraud convictions as directly relevant to fitness to practice and typically revokes licenses.
• Insurance Agents – Indiana Department of Insurance treats fraud convictions as grounds for license denial or revocation.
• Healthcare Professionals – Doctors, nurses, and other healthcare professionals face license discipline and potential exclusion from Medicare/Medicaid participation.

License Discipline Procedures

Professional licensing proceedings is separate from the criminal case. Even if your not convicted—for example, if charges is dismissed after completing a deferred prosecution agreement—licensing boards can still impose discipline based on the underlying conduct.

The timeline typically works like this:

• During criminal proceedings – Most boards won’t act until the criminal case is resolved, but they may place your license on probationary status.
• After conviction or plea – The board initiates disciplinary proceedings, usually within 6-12 months.
• Disciplinary hearing – You has the right to a hearing, where you can present evidence in mitigation.
• Board decision – The board can impose sanctions ranging from reprimand to permanent revocation.

Strategies to Minimize License Consequences

If your livelihood depends on a professional license, you need to develop a coordinated strategy that addresses both criminal and licensing issues:

• In plea negotiations, seek language that minimizes admissions beyond what’s absolutely necessary
• Consider whether a plea to a lesser charge (false statements vs. wire fraud) might affect licensing differently
• Explore deferred prosecution agreements or pretrial diversion programs
• Prepare a comprehensive mitigation presentation for the licensing board
• Demonstrate rehabilitation through counseling, ethics courses, community service

In some cases, its possible to negotiate an agreement where you surrender your license voluntarily with the possibility of reinstatement after a period of years, rather then facing permanent revocation.

Business and Financial Impacts

A PPP fraud conviction carries numerous other collateral consequences:

Government Contracting Exclusion

Conviction of fraud involving a federal program typically results in debarment from federal contracting for several years. The General Services Administration (GSA) maintains the System for Award Management (SAM) exclusion list.

If your business depends on government contracts, a conviction can be a death sentence for the company.

Security Clearance Revocation

Any security clearance will almost certainly be revoked following a fraud conviction. This affects not just government employees but also contractors in defense, intelligence, and other sensitive industries.

Even after serving your sentence, obtaining a new clearance will be extremely difficult, if not impossible.

Professional Liability Insurance

Many professional liability insurance policies (errors and omissions, malpractice) excludes coverage for criminal acts. A fraud conviction may leave you uninsured for any subsequent claims.

Additionally, obtaining professional liability insurance after a conviction is difficult and expensive—many insurers simply won’t cover someone with a fraud conviction.

Corporate Officer and Director Positions

Many corporate bylaws prohibits convicted felons from serving as officers or directors. Even if bylaws don’t explicitly prohibit it, shareholders or boards typically remove convicted officers.

You may also be prohibited from serving as a fiduciary (trustee, executor, guardian) under state law.

Banking and Credit

Banks regularly refuse to provide accounts or services to convicted fraudsters. You may find it difficult to:

• Open business accounts
• Obtain credit cards or loans
• Get approved for mortgages

Even personal banking can become challenging, as banks views fraud convictions as significant risk factors.

Parallel Civil Proceedings: Navigating Dual Exposure

False Claims Act Qui Tam Lawsuits: The Whistleblower Wild Card

One of the unique aspects of PPP fraud cases is the potential for parallel civil litigation under the False Claims Act (FCA). Understanding how these civil cases interact with criminal proceedings is essential.

How Qui Tam Cases Work

The False Claims Act allows private individuals (called “relators”) to file lawsuits on behalf of the United States against those who defrauded the government. If the lawsuit succeeds, the relator recieves 15-30% of the amount recovered.

Here’s how it typically unfolds:

1. Relator files under seal – The lawsuit is filed in federal court but kept secret from the defendant
2. Government investigation – The DOJ has 60 days (often extended to 12-18 months) to investigate and decide whether to intervene
3. Intervention decision – The government either intervenes (takes over the case) or declines, allowing the relator to proceed alone
4. Lawsuit proceeds – If the government intervenes, they control the litigation; if not, the relator’s attorney prosecutes the case

Who Files Whistleblower Cases?

In PPP fraud cases, we’re seeing whistleblowers from various sources:

• Former employees who know the payroll was inflated or the business wasn’t eligible
• Business partners who participated in the application but later had a falling out
• Ex-spouses seeking revenge and financial gain
• Accountants or bookkeepers who prepared applications and later regretted there involvement
• Competitors who suspect fraud and see an opportunity for financial reward

The 15-30% reward creates powerful incentives. In a case involving $500,000 in fraudulent loans, the whistleblower could receive $75,000-$150,000. That’s enough to motivate plenty of people who might otherwise mind there own business.

Civil vs. Criminal Strategy: Walking the Tightrope

When your facing both criminal charges and a civil FCA lawsuit, you’re caught in a difficult position. Statements you makes in the civil case can be used against you criminally, but refusing to participate in the civil case can hurt you their.

The Fifth Amendment Problem

You has the right to assert your Fifth Amendment privilege against self-incrimination in civil proceedings. If asked questions in a deposition or other civil discovery, you can refuse to answer if your answer might incriminate you.

However, asserting the Fifth Amendment in civil litigation has consequences:

• The civil court can draw an adverse inference from your silence (unlike in criminal cases)
• Your refusal to testify may lead to default judgment or sanctions
• It signals to everyone involved that you has something to hide

The typical strategy is to seek a stay of the civil case until the criminal case is resolved. Federal judges routinely grant these stays, recognizing the unfairness of forcing someone to choose between defending a civil case and protecting their criminal rights.

Coordinating Civil and Criminal Counsel

If your facing both civil and criminal exposure, you need attorneys who can coordinate strategy across both cases. Sometimes this means the same attorney handles both; other times, you needs separate counsel who work together.

Key coordination issues include:

• Discovery responses – anything you produce in the civil case can be used criminally
• Depositions and interrogatories – asserting the Fifth Amendment appropriately
• Settlement negotiations – resolving civil liability without admitting criminal culpability
• Timing – whether to resolve criminal or civil first

Settlement Considerations

FCA cases often settles even when criminal charges is pending or after conviction. The settlement amount typically includes:

• Single damages (the amount fraudulently obtained)
• Treble damages multiplier (3x the loss amount)
• Civil penalties ($11,000-$22,000 per false claim)
• Relator’s share (15-30% of the recovery)

For a $200,000 PPP fraud, a civil settlement could easily reach $600,000 or more ($200,000 × 3 = $600,000, plus civil penalties).

One key question: does resolving the civil case first (by paying a settlement) help or hurt you criminally? It depends. On one hand, paying restitution demonstrates acceptance of responsibility. On the other hand, settling the civil case often requires admissions that can be used against you criminally.

This is why coordination between criminal and civil counsel is so critical.

Special Issues in PPP Cases

Affiliate Attribution Rules: The Trap Many Businesses Missed

One of the most technical—and commonly misunderstood—issues in PPP cases involves affiliate attribution rules under 13 CFR 121.103. Many defendants didn’t realize they made false statements about affiliates, yet this issue has become a major focus of prosecutions.

What Are SBA Affiliate Rules?

Under SBA regulations, businesses is considered “affiliates” when one controls or has the power to control the other, or when a third party controls or has the power to control both. Affiliated businesses must be aggregated when determining eligibility and loan amounts.

Common affiliate relationships:

• Ownership – If you owns more then 50% of multiple businesses, they’re affiliates
• Management – If you manage multiple businesses, they may be affiliates even without majority ownership
• Identity of interest – Family members’ businesses can be considered affiliates if there’s close business relationships
• Contractual relationships – Franchise agreements or certain contractor relationships creates affiliation

Common Mistakes

Many business owners made these errors:

• Owning three restaurants but applying for PPP loans for each without disclosing the affiliation
• Failing to disclose spousal ownership of related businesses
• Not aggregating employee counts across affiliated entities
• Applying through both a parent company and subsidiaries

The problem: if you had 10 employees at Business A and 20 at Business B (both of which you own), you should of disclosed 30 total employees and potentially been ineligible for the loan amounts you claimed—or ineligible altogether if the total exceeded the 500-employee threshold.

How to Challenge Affiliate Determinations

SBA affiliate rules is complex, and reasonable minds can disagree about whether affiliation exists in marginal cases. Defenses include:

• Demonstrating that you lacked “control” as defined by SBA regulations
• Showing that businesses operated independently with separate management
• Proving that any affiliation was severed before the PPP application
• Arguing that SBA guidance on affiliate rules was ambiguous

In some cases, you legitimately misunderstood the affiliate rules—and that lack of intent can negate criminal liability.

Loan Forgiveness vs. Application Fraud: Different Standards

Not all PPP fraud is the same. The government distinguishes between fraud in the original loan application and fraud in the forgiveness application—and the legal standards differs.

Application Fraud

Fraud in the initial application typically involves:

• False payroll numbers
• Claims that the business existed before February 15, 2020, when it didn’t
• Failure to disclose affiliate relationships
• Misrepresenting the business type or eligibility

At the application stage, borrowers certified that they was eligible and that all information was accurate. These certifications forms the basis for false statement and wire fraud charges.

Forgiveness Fraud

Forgiveness fraud involves false statements about how PPP funds was used. The CARES Act allowed forgiveness if:

• At least 60% was spent on payroll costs
• The remainder was spent on allowable expenses (rent, mortgage interest, utilities)
• Employee headcount and wages was maintained

Common forgiveness fraud includes:

• Submitting fake payroll records
• Claiming personal expenses as business expenses
• Falsifying rent or utility payments
• Using funds for prohibited purposes then creating false documentation for forgiveness

Exposure for Legitimate Loan, Fraudulent Use

Heres a scenario we see regulary: a business legitimately qualified for a PPP loan, recieved the funds, but then used them improperly—for personal expenses, luxury purchases, or paying off personal debts. Then, when forgiveness time came, they created false documentation showing the funds was used for payroll and allowable expenses.

This is still fraud, even though the original loan application was legitimate. The government treats forgiveness fraud just as seriously as application fraud, and the penalties is the same.

Documentation Requirements

The forgiveness application required extensive documentation:

• Payroll tax filings (941 forms)
• Bank statements
• Cancelled checks or payment receipts
• Documentation of FTE (full-time equivalent) employees

Fabricating any of these documents is a federal crime. We’ve seen cases where defendants:

• Created fake 941 forms
• Photoshopped bank statements
• Backdated checks
• Listed employees who never existed

Document fabrication adds sophisticated means enhancement (+2 points at sentencing) and signals to judges that this was a deliberate scheme, not an innocent mistake.

Statute of Limitations: Understanding Your Timeline of Exposure

An often-overlooked issue is the statue of limitations—how long the government has to bring charges. For PPP fraud, the timeline is more complex then you might think.

Wire Fraud: 5 Years

Wire fraud (18 USC 1343) has a 5-year statute of limitations. The clock starts from the date of the last wire communication that furthered the fraud.

For PPP cases, this typically means 5 years from:

• The date you submitted the electronic application
• The date of the last electronic communication with the lender
• The date you submitted the forgiveness application electronically

So if you submitted your application in April 2020, the statute of limitations expires in April 2025. But if you submitted a forgiveness application in June 2021, the statute runs until June 2026.

Bank Fraud: 10 Years

Bank fraud (18 USC 1344) has a 10-year statute of limitations. Although prosecutors typically prefer wire fraud charges, bank fraud can be charged if wire fraud is time-barred.

Conspiracy: Depends on Last Overt Act

For conspiracy charges (18 USC 371), the 5-year statute of limitations starts from the date of the last overt act in furtherance of the conspiracy—not from the beginning of the conspiracy.

This means if you obtained a PPP loan in 2020 but continued to conceal the fraud through false statements in 2022, the statute may not expire until 2027.

Sealed Indictments

Here’s a curveball: the statute of limitations is satisfied when the indictment is filed, not when your arrested or notified. Federal prosecutors sometimes files sealed indictments just before the statute expires, then waits to arrest defendants later.

So even if the 5-year mark has passed, you could still be indicted if the government filed sealed charges before the deadline.

Tolling Provisions

The statute of limitations can be tolled (paused) in certain circumstances:

• If you was outside the country for extended periods
• During certain types of bankruptcy proceedings
• If you actively concealed the crime

Concealment is particularly relevant in PPP cases. If you took steps to hide the fraud—destroying records, providing false information to auditors—the government may argue the statute shouldn’t start running until the fraud was discovered.

Why You Need Specialized Federal Defense Counsel

The Complexity Requires Specialized Knowledge

PPP fraud cases isn’t like state criminal cases. There not even like typical federal cases. They requires attorneys with specific expertise in:

Federal Sentencing Guidelines

As we’ve discussed, federal sentencing is highly technical. An attorney who don’t thoroughly understand guideline calculations can miss opportunities to reduce your offense level by challenging loss amounts, contesting enhancements, or arguing for departures.

The diffrence between a lawyer who understands guidelines and one who doesn’t can literaly be years of your life.

SBA Regulatory Requirements

PPP cases requires knowledge of SBA regulations—13 CFR provisions governing eligibility, affiliate rules, loan calculations, and allowable uses. An attorney who doesn’t understand these regulations cannot effectively challenge the government’s theory of fraud or present viable defenses.

Federal Rules of Criminal Procedure

Federal procedure differs substantially from state court. Discovery rules, motion practice, trial procedures, and appellate processes all follows federal rules that requires specific experience to navigate.

Relationships with U.S. Attorney’s Offices

Experienced federal defense attorneys has working relationships with Assistant U.S. Attorneys in the Northern and Southern Districts. These relationships—built over years of cases—facilitates more productive plea negotiations and helps attorneys understand prosecutors’ priorities and tendencies.

An attorney who regularly practices in federal court knows which prosecutors is reasonable and which is inflexible, which judges is receptive to certain arguments, and how the local federal legal culture operates.

Experience in Both Indiana Districts

As we’ve discussed, the Northern and Southern Districts has different cultures and approaches. An attorney experienced in both districts understands these differences and can adapt strategy accordingly.

Critical Skills for PPP Defense

When evaluating potential counsel, look for these specific capabilities:

White-Collar Crime Experience

PPP fraud is white-collar crime, and it requires different skills then violent crimes or drug cases. White-collar defense involves:

• Analyzing complex financial documents
• Working with forensic accountants and other experts
• Understanding business practices and accounting principles
• Presenting sophisticated legal arguments about intent and good faith

An attorney whose practice focuses on violent crimes or DUIs may not has the specialized skills your case requires.

Federal Trial Experience

While most cases plead, you needs an attorney who can credibly threaten trial. Prosecutors offers better plea deals to defendants represented by attorneys who has track records of taking cases to trial and winning.

Ask potential attorneys:

• How many federal trials have you conducted?
• What where the outcomes?
• Have you tried white-collar cases specifically?

Forensic Accounting Coordination

PPP cases almost always requires forensic accountants. Your attorney needs to know how to work with these experts—how to frame the questions, challenge opposing experts, and present accounting evidence to judges and juries.

Pre-Indictment Negotiation Track Record

As discussed, the pre-indictment phase is critical. Ask potential attorneys:

• Have you secured declinations in federal investigations?
• What strategies did you use?
• Can you provide examples (without breaching confidentiality)?

Attorneys who has successfully convinced prosecutors not to bring charges is valuable—they understand what works with federal prosecutors and can maximize your chances of avoiding indictment altogether.

Sentencing Mitigation Expertise

Even with a conviction, sentencing is a second opportunity for advocacy. Experienced attorneys knows how to:

• Develop comprehensive sentencing memoranda
• Gather letters of support from family, colleagues, and community members
• Present mental health or substance abuse issues effectively
• Argue for variances based on individual circumstances
• Challenge guideline calculations and enhancements

Sentencing advocacy can mean the diffrence between probation and prison, or between 2 years and 5 years.

Questions to Ask Potential Counsel

When interviewing attorneys, ask these specific questions:

Experience with PPP Cases

• “How many PPP fraud cases has you handled?”
• “What was the outcomes?”
• “Have you handled cases in both Indiana federal districts?”

Track Record of Success

• “Have you ever secured a declination or dismissal in a federal fraud investigation?”
• “What percentage of your cases results in sentences below the guideline range?”
• “Can you provide references from former clients?”

Approach and Strategy

• “What would be your initial strategy in my case?”
• “What experts would you retain?”
• “How do you approach pre-indictment intervention?”
• “What’s your assessment of the government’s evidence?”

Team and Resources

• “Who else would work on my case?” (paralegals, associates, investigators)
• “Do you has relationships with forensic accountants?”
• “How do you communicate with clients throughout the process?”

Fees and Costs

• “What is your fee structure?” (hourly, flat fee, retainer)
• “What is the estimated total cost?”
• “Do you offers payment plans?”
• “What costs are seperate from attorney fees?” (expert fees, investigation costs)

Don’t be afraid to ask direct questions about fees. Federal criminal defense is expensive—PPP cases often costs $50,000-$150,000 or more depending on complexity. But knowing the costs upfront allows you to make informed decisions.

Next Steps: What You Need to Do Right Now

If your facing a PPP fraud investigation or charges, time is critical. Heres what you should do immediately:

1. Stop Talking to Investigators

If agents has contacted you, do not speak with them without an attorney present. Politely decline and say you want to consult with counsel first. You cannot talk your way out of a federal investigation, and anything you say will be used against you.

2. Preserve Documents

Do not destroy any documents related to your PPP loan—not bank statements, not tax returns, not emails, not text messages. Destroying evidence is a seperate federal crime (obstruction of justice) that can add years to your sentence.

Even if you think documents is incriminating, destroying them is always worse then preserving them.

3. Consult with Federal Criminal Defense Attorneys Immediately

The pre-indictment window is narrow—often just 30-60 days. Every day you waits is a day lost for investigation, strategy development, and potential intervention with prosecutors.

Initial consultations is typically confidential and allows you to assess your options without commitment.

4. Gather Financial Records

Your attorney will need comprehensive financial records to understand your case and develop defense strategy. Start gathering:

• PPP loan application and all supporting documents
• Bank statements for business and personal accounts (past 3 years)
• Tax returns (business and personal, past 3 years)
• Payroll records
• Correspondence with lenders, accountants, and anyone involved in the application

5. Don’t Discuss Your Case

Do not discuss your case with anyone except your attorney. Conversations with family members, business partners, employees, or friends is not privileged—they can be subpoenaed to testify against you.

Only communications with your attorney is protected by attorney-client privilege.

What to Bring to Your Initial Meeting

When you meet with an attorney for the first time, bring:

• Any correspondence from the DOJ, FBI, SBA OIG, or other agencies
• Target letters or subpoenas
• Your PPP loan application
• Timeline of events (when you applied, recieved funds, used funds, applied for forgiveness)
• Names of potential witnesses (employees, accountants, business partners)
• Any documents you beleive is relevant

The more information you provides upfront, the better your attorney can assess your situation and provide realistic advice.

Understanding That Early Intervention Changes Outcomes

I cant stress this enough: the earlier you retains experienced counsel, the better your outcome is likely to be. Cases where defendants engaged attorneys before indictment has significantly better results then cases where defendants waited until after arrest.

Pre-indictment intervention can result in:

• Declinations (no charges filed)
• Reduced charges
• Better plea offers
• Time to prepare a defense without the pressure of looming trial dates

Don’t wait. If your under investigation or has any reason to beleive you might be, consult with federal criminal defense counsel today.

PPP fraud charges is among the most serious federal offenses, carrying substantial prison time, massive restitution, and life-altering collateral consequences. But with experienced counsel, strategic defense, and early intervention, you can navigate this crisis and work toward the best possible resolution.

Your future depends on the decisions you makes right now. Make them count.