Criminal Defense Lawyers

Bakersfield PPP Loan Fraud Lawyers

The Paycheck Protection Program (PPP) was created in 2020 as part of the CARES Act to provide emergency loans to small businesses impacted by COVID-19. While the PPP provided a lifeline to many struggling companies, some unscrupulous individuals took advantage of the program to commit fraud and embezzle funds. In Bakersfield, California, both medical practices and attorneys have faced allegations of PPP loan fraud.

Notable PPP Fraud Cases in Bakersfield

One notable case involved Dr. Jasbir Singh Walia, who owns the Walia Pain Management Center in Bakersfield. In April 2020, Walia obtained a PPP loan of $430,000 for his medical practice. However, he failed to disclose that he had already received a PPP loan of $630,000 for another company he owned. Obtaining multiple PPP loans for different companies he controlled was a violation of PPP rules.As a result, Walia had to pay over $1 million to settle allegations of False Claims Act violations. The case was investigated by the U.S. Attorney’s Office for the Eastern District of California, which frequently uses civil fraud statutes to recover misused federal funds.

Scrutiny of Attorneys for Potential Fraud

Beyond medical practices, some Bakersfield attorneys have also faced scrutiny for potential PPP loan fraud. In May 2017, local lawyer Mark E. Hart was accused of masterminding a $22 million billing fraud scheme. Hart allegedly led a group of attorneys and marketers who submitted fraudulent bills to insurance companies over a four-year period. If any charges are filed, Hart could potentially face federal charges like mail/wire fraud or identity theft.

Securing Experienced Legal Counsel

For those dealing with PPP loan fraud allegations, securing experienced legal counsel is critical. Federal prosecutors are aggressively pursuing CARES Act violations nationwide. Potential criminal charges could include wire/mail fraud, money laundering, bank fraud, making false statements, or aggravated identity theft.Bakersfield federal criminal defense lawyers can advise individuals and companies accused of PPP loan fraud or related offenses. An attorney can evaluate the case details and applicable defenses. For instance, some defendants may claim they misunderstood PPP rules or made errors in their applications. Or they can argue the government is overreaching in its interpretation of fraud statutes.Skilled federal fraud lawyers also know how to negotiate with prosecutors, potentially convincing them to drop or reduce charges. They can also represent clients if charges reach trial, drawing on experience handling complex white collar cases.

Key Legal Defenses

Some key legal defenses in PPP loan fraud cases may include:

• Lack of intent – Proving fraud requires showing the defendant knowingly tried to deceive. If errors resulted from negligence rather than intent, it weakens the government’s case.
• No harm occurred – If loans were repaid or put toward eligible uses, defendants can argue no financial loss resulted. This challenges claims of criminal conduct.
• Unclear rules – Ambiguities or gaps in PPP rules could bolster claims that violations were accidental, not fraudulent.
• Selective prosecution – Evidence that the government unevenly enforces PPP rules against certain groups or individuals may help dismiss charges.

Skilled federal defense lawyers can deploy these and other defenses to protect clients from harsh penalties. For PPP fraud involving over $1 million, potential sentences can include over 10 years in prison.

Conclusion

Facing PPP loan fraud accusations can be stressful for individuals and businesses. But with an experienced Bakersfield federal criminal defense lawyer, clients can develop an effective strategy to mitigate charges and penalties. Thorough case evaluation and preparation is key to achieving the best possible outcome.