Last Updated on: 11th October 2023, 06:18 pm

The COVID-19 pandemic has led to an unprecedented amount of federal aid being made available to struggling businesses and individuals across the United States. One of the main vehicles for this aid has been the Paycheck Protection Program (PPP), which authorized hundreds of billions of dollars in potentially forgivable loans to small businesses impacted by the pandemic. Another program offering aid is the Economic Injury Disaster Loan (EIDL) program, which provides low-interest loans to businesses affected by COVID-19.While these programs have no doubt helped many legitimate businesses stay afloat, the large amounts of money involved have unfortunately also attracted fraudsters looking to take advantage. As a result, PPP and EIDL fraud have become major issues in North Dakota and nationwide. In this article, we’ll provide an overview of PPP and EIDL fraud issues in North Dakota, defenses against charges, and how an experienced lawyer can help.

Overview of PPP and EIDL Fraud in North Dakota

North Dakota has seen its fair share of PPP and EIDL fraud cases. Some examples include:

• In 2020, a Fargo doctor was charged with fraudulently obtaining over $1.8 million in PPP and EIDL loans. He allegedly submitted false information about his business’s payroll expenses.
• Also in 2020, a Dickinson man was charged with fraudulently obtaining over $500,000 in PPP loans. He allegedly submitted false payroll information and used the money for personal purchases.
• In 2021, a group known as the “Hustle Boys” from Fargo and West Fargo were indicted for obtaining over $1.4 million in fraudulent PPP and EIDL loans.
• Just this year, a Grand Forks doctor was charged with fraudulently obtaining $1.8 million in PPP and EIDL loans.

These are just a few examples – many more cases of PPP and EIDL fraud have been prosecuted in North Dakota. The common themes are people using false information to obtain loans they aren’t entitled to, or using the money for prohibited personal purchases instead of approved business expenses.

Potential Charges for PPP and EIDL Fraud

There are a variety of state and federal charges that can potentially apply in PPP and EIDL fraud cases:

• Wire fraud – Using interstate wires to execute a scheme to defraud can lead to federal wire fraud charges under 18 USC § 1343. This applies to fraudulent information transmitted electronically in loan applications.
• Bank fraud – Knowingly executing a scheme to defraud a financial institution can lead to federal bank fraud charges under 18 USC § 1344. This applies to fraudulent PPP and EIDL loan applications.
• Aggravated identity theft – Using someone else’s means of identification without authority during fraud can lead to federal identity theft charges under 18 USC § 1028A. This applies if a fraudster uses someone else’s identity information.
• Forgery – Falsely making or altering a document with intent to defraud can lead to state forgery charges under NDCC § 12.1-24-01. This applies to fake payroll records or other false application documents.
• Theft – Knowingly taking someone else’s property with intent to deprive them of it can lead to state theft charges under NDCC § 12.1-23-02. This applies to misuse of fraudulently obtained loan funds.

These are just some examples – there are many other charges that could potentially apply depending on the specific circumstances. The penalties can be severe – up to 30 years in prison for some federal fraud charges.

Defenses in PPP and EIDL Fraud Cases

If you are being investigated or charged with PPP or EIDL fraud, having an experienced criminal defense lawyer on your side is critical. A knowledgeable attorney can evaluate the strength of the government’s case and identify potential defenses. Some possible defenses include:

• No intent to defraud – For most fraud charges, the government must prove you specifically intended to defraud. If there was simply a misunderstanding or mistake on a loan application, that could refute intent.
• No false statements – The government must prove objectively false statements in a loan application. If the alleged false statements are actually opinions or within a range of acceptable estimates, that could undermine the charges.
• Authorized use of funds – For charges related to misuse of funds, you may have evidence the funds were in fact used for authorized purposes like payroll and business expenses.
• Duress – If you were coerced into committing fraud by threats of harm, that may provide a duress defense.
• Entrapment – If government agents improperly induced you to commit fraud you otherwise wouldn’t have, that may provide an entrapment defense.

An experienced lawyer can help evaluate if any of these defenses apply in your specific case. The lawyer can also negotiate with prosecutors for reduced charges or a favorable plea deal.

How a Lawyer Can Help if You’re Charged with PPP or EIDL Fraud

Here are some of the key ways an experienced criminal defense lawyer can help if you find yourself charged with PPP or EIDL fraud:

• Conduct an independent investigation of the allegations and evidence against you to identify weaknesses in the government’s case.
• Negotiate with prosecutors to get charges reduced or dismissed – this happens frequently.
• Develop defense strategies and defenses as described above.
• Represent you in pretrial proceedings and file motions to protect your rights.
• If necessary, take your case to trial with the aim of getting an acquittal on some or all charges.
• Argue for minimized penalties and sentencing leniency if convicted.

Having skilled legal counsel makes a major difference in fraud cases. Don’t take chances with your future – consult with an experienced North Dakota PPP and EIDL fraud lawyer right away if you are charged. The initial consultation is also usually free.

Finding the Right Lawyer for Your Case

If you or a loved one is charged with PPP or EIDL fraud in North Dakota, it’s essential to find an experienced lawyer you’re comfortable with. Here are some tips:

• Look for a lawyer with extensive experience specifically handling federal fraud cases in North Dakota. This area of law is complex.
• Consider lawyers with backgrounds as former federal prosecutors. Their insight can be invaluable in federal cases.
• Make sure the lawyer has represented clients in PPP and EIDL fraud cases specifically. Experience with these unique programs is a must.
• Schedule initial consultations with a few qualified lawyers before deciding. Make sure you have a good rapport and can trust them.
• Ask about the lawyer’s track record of getting charges reduced or dismissed pretrial. Past results indicate ability.
• Choose a lawyer you’re confident will fight tirelessly to protect your rights and interests through every stage. This could go to trial.

Don’t leave your future to chance – put an experienced North Dakota PPP and EIDL fraud lawyer on your side.

Conclusion

PPP and EIDL fraud unfortunately became common during the COVID-19 pandemic, as huge amounts of aid money flowed rapidly. But charges still must be proven, and an experienced lawyer can often get them dismissed or reduced. If you find yourself under investigation or charged related to PPP or EIDL loans in North Dakota, don’t delay in contacting a qualified attorney. An initial consultation is typically free. With an experienced lawyer guiding you, the best possible outcome can be achieved.