Mar 21, 2024

Vermont PPP – SBA – EIDL Loan Fraud Lawyers

Vermont PPP – SBA – EIDL Loan Fraud Lawyers

The COVID-19 pandemic led to an unprecedented level of federal aid being distributed to businesses and individuals in need. While these programs like the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) program provided a lifeline for many, they also created opportunities for fraud. In Vermont and across the country, some unscrupulous individuals took advantage of the rushed rollout of these programs to obtain loans illegally. This article will examine PPP and EIDL fraud issues specific to Vermont, including applicable laws, recent cases, and potential defenses for those accused of fraud.

Federal Laws Related to PPP and EIDL Fraud

There are several key federal laws that prosecutors use to go after PPP and EIDL fraud in Vermont and nationwide:

• Wire Fraud – 18 U.S.C. § 1343 makes it a crime to scheme to defraud someone out of money or property through electronic communications like email or wire transfers.
• Bank Fraud – 18 U.S.C. § 1344 prohibits schemes to defraud or obtain money under custody or control of a bank through false statements.
• False Statements – 18 U.S.C. § 1001 makes it illegal to knowingly make false statements in any matter within federal agency jurisdiction.
• Aggravated Identity Theft – 18 U.S.C. § 1028A provides enhanced penalties for identity theft related to other crimes.

Prosecutors often stack multiple charges together, using wire fraud, bank fraud, and/or false statements regarding the fraudulent loan application itself. Aggravated identity theft gets added if personal information was misused without authorization.

Penalties can be severe – wire and bank fraud carry up to 30 years per count, false statements up to 5 years, and aggravated identity theft a mandatory minimum 2 years consecutive sentence. Restitution to repay misused funds is also typically ordered.

Recent PPP and EIDL Fraud Cases in Vermont

Vermont has seen its share of PPP and EIDL fraud cases prosecuted federally in the past couple years. Some notable examples include:

• In April 2020, Dana McIntyre of Beverly, MA submitted a fraudulent PPP application for over $660,000 for his former North Shore pizzeria. He falsified the number of employees and payroll expenses and spent the money on personal purchases. McIntyre pled guilty to wire fraud and was sentenced to 2 years in prison.^[3][4]
• In 2020, Vt resident and 4-time felon Levi Delima fraudulently applied for $120,600 in PPP loans for a sham pet supply business. After spending that money, he applied for another $150,000 in EIDL funds. He pled guilty to federal wire fraud and awaits sentencing.^[5]
• In 2021, the DOJ charged several Vermont residents with wire fraud for falsified PPP applications, including a $1.2 million loan for a fake dental practice and a $231,000 loan for a bogus beauty salon.

These cases highlight how substantial prison time and restitution are very real risks for PPP and EIDL fraud in Vermont. Those found guilty at trial face sentencing enhancements for obstruction of justice as well.

Defenses and Strategies Against PPP and EIDL Fraud Charges

Despite the risks, all hope is not lost if you are being investigated for or charged with PPP or EIDL fraud in Vermont. Here are some potential defenses to explore with your attorney:

• No intent to defraud – The government must prove you knowingly devised a scheme to defraud and had intent to deceive. If false statements were unintentional errors instead of purposeful lies, that negates this element.
• Repaid funds – Making restitution by paying back ill-gotten loan funds before charges are filed shows good faith and can persuade prosecutors not to indict.
• Statute of limitations – Charges must be brought within 5 years of PPP/EIDL fraud for false statements and within 10 years for wire/bank fraud.^[6] Running out the clock can bar prosecution.
• Entrapment – If government agents improperly induced you to commit fraud you otherwise wouldn’t have, that is entrapment.
• Jurisdictional issues – Federal prosecutors have limited resources and may decline cases falling below a certain dollar threshold.

An experienced federal fraud defense lawyer can carefully analyze the facts of your case and build customized defenses to defeat the government’s allegations. Thorough pre-trial investigation and motion practice are key.

Avoiding PPP and EIDL Investigations and Charges

The best protection against PPP or EIDL fraud accusations in Vermont is taking proactive compliance steps like:

• Carefully reviewing all loan program rules and restrictions
• Seeking clarification from lenders if unsure about any application requirements
• Maintaining thorough documentation of eligibility and how funds were used
• Consulting with legal counsel before applying if you have a prior fraud conviction or bankruptcy
• Avoiding exaggeration or misrepresentation on applications
• Spending funds only on approved uses like payroll, rent, utilities, etc
• Promptly repaying any funds that were improperly received or misused

Mistakes may still occur even when acting in good faith. If you believe you are being wrongfully accused: do NOT speak with investigators without an attorney present, preserve documentation demonstrating proper use of funds, and retain experienced legal counsel to protect your rights.

Finding an Attorney for PPP or EIDL Fraud Charges

Facing federal criminal allegations related to COVID relief loans can be frightening. The experienced white collar defense attorneys at [Law Firm Name] understand how to protect the rights of those accused of PPP, EIDL, or other pandemic-related fraud in Vermont. We have successfully defended complex financial crime cases in federal courts across the country.

If you believe you are being wrongfully accused, it is critical to retain counsel immediately to avoid missteps. We can conduct a thorough independent investigation, identify weaknesses in the government’s case, and build a strong defense strategy. Our track record of favorable pre-trial resolutions shows we know how to get charges reduced or dismissed before indictment.

We will aggressively defend you against allegations of:

• PPP or EIDL application fraud
• Misuse of loan proceeds
• Falsified payroll/employment records
• Fake supporting documentation
• Identity theft
• Money laundering
• And related federal charges

Our firm has successfully defended PPP and EIDL fraud cases by raising issues like:

• Lack of criminal intent
• Weak circumstantial evidence
• Unclear loan program rules
• Improper government conduct
• Statute of limitations expirations

We know how to analyze complex financial transactions and records to cast doubt on the prosecution’s accusations. We are trial-ready but also explore every opportunity for pre-trial diversion or negotiated settlement if appropriate.

Don’t go it alone against the full force of federal law enforcement and prosecutors. The skilled federal fraud defense attorneys at Spodek Law have the experience and determination to achieve the best possible outcome for your case. Contact us for a free consultation today.

Vermont PPP – SBA – EIDL Loan Fraud Lawyers