12 Sep 23

Austin PPP – SBA – EIDL Loan Fraud Lawyers

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Last Updated on: 12th September 2023, 04:20 am

Austin PPP – SBA – EIDL Loan Fraud Lawyers

The COVID-19 pandemic brought unprecedented government assistance to small businesses across America. The Paycheck Protection Program (PPP), Economic Injury Disaster Loans (EIDL), and other federal programs provided hundreds of billions in loans and grants to small businesses impacted by the economic crisis; however, these rapid relief programs also opened the door to significant fraud. With so much money flowing so quickly, many unscrupulous applicants saw an opportunity for abuse. Now, federal prosecutors are cracking down on PPP, EIDL, and other COVID relief fraud with waves of indictments and charges across the country. If you or your business are under investigation for allegedly fraudulent receipt of pandemic assistance in Austin or anywhere in Texas, you need an experienced federal defense lawyer on your side immediately.

Common schemes leading to federal charges

Prosecutors are pursuing charges against a wide range of fraudulent activity related to COVID relief programs. Some common alleged schemes include:

  • Falsifying payroll, number of employees, or other information on PPP loan applications
  • Using PPP funds for non-eligible purposes like personal purchases instead of payroll
  • Applying for multiple overlapping PPP loans from different lenders
  • Falsifying information on EIDL applications like number of employees or revenue
  • Applying for and receiving EIDL grants and loans that exceed eligibility limits
  • Using multiple identities or business names to obtain multiple EIDL loans

These and many other schemes can lead federal agencies including the Department of Justice (DOJ)Small Business Administration Office of Inspector General (SBA OIG)Federal Bureau of Investigation (FBI)Internal Revenue Service Criminal Investigation (IRS CI)U.S. Secret Service, and U.S. Postal Inspection Service to open investigations. Depending on the specific allegations, potential charges could include:

  • Wire fraud
  • Bank fraud
  • False statements
  • Aggravated identity theft
  • Money laundering
  • Conspiracy
  • Theft of government funds

These federal felony charges often carry substantial prison time as well as massive fines and asset forfeiture. For instance, wire fraud and bank fraud are punishable by up to 30 years in prison. Aggravated identity theft carries a mandatory minimum 2 year prison sentence per count. With the stakes so high, having an experienced federal defense lawyer is critical from the very beginning of the investigation.

An aggressive pre-charge defense can make all the difference

Too many people under federal investigation make critical mistakes that compromise their defense. They speak to investigators without counsel present. They fail to immediately retain attorneys experienced in federal cases. They wait and see, allowing the investigators to build their case. They underestimate the ability of skilled prosecutors to stack charges that can add up to decades behind bars.This passive approach is enormously risky. The longer you wait to engage legal counsel, the harder it becomes to mitigate the charges or potential sentences you may face. Retaining federal defense lawyers immediately allows us to get to work right away to protect your rights and future.As former federal prosecutors ourselves, we know how these cases are investigated, charged, and tried. We work proactively to intervene before charges are filed through aggressive representation, negotiating with prosecutors and investigators, conducting parallel internal investigations, marshalling exculpatory evidence, and more. Where misconduct or fraud has occurred, we work to minimize your involvement and demonstrate mitigating factors that the prosecution must consider.Even if charges have already been filed, it is still not too late to fight. Criminal indictments and complaints only contain one side of the story – the prosecution’s. We carefully analyze the charges and evidence through the lens of our deep defense experience to build the strongest possible case on your behalf.

Federal judges and juries often respond favorably to certain defenses

While every federal fraud case is different, some of the most compelling defenses our Austin white collar criminal defense attorneys commonly employ include:

  • No intent to defraud – Many federal fraud charges require prosecutors to prove you knowingly and intentionally tried to obtain money or information unlawfully. We work to show you did not act with deceitful intent.
  • Good faith – If you had an honest belief you were following applicable PPP or EIDL rules and submitted accurate information, that helps negate intent arguments.
  • Minimal or no loss – The government’s actual financial losses directly caused by alleged misconduct are very relevant. If funds were used properly or repaid, it undercuts prosecution.
  • Cooperation – Admitting fault early and providing substantial assistance to investigators and prosecutors on other cases may lead to more favorable settlements.
  • Compliance ambiguities – Rules around qualifying for and using PPP/EIDL funds were unclear initially. If you made reasonable efforts to follow shifting guidelines, it shows lack of willfulness.
  • No prior offenses – Judges and juries view first-time offenders much more sympathetically, especially if you have an otherwise clean record and reputation.

In cases involving multiple co-defendants, there may also be opportunities to minimize your role in comparison with others. The key is engaging experienced federal defense lawyers who know how to strategically position you to take advantage of these kinds of arguments.

Coronavirus fraud crackdown in Texas

Texas has seen some of the most extensive COVID relief fraud prosecutions in the country. As both U.S. Attorneys and investigators with offices across the state have ramped up enforcement actions, defendants face a complex mix of local federal prosecutors and agents from agencies like the FBI, IRS, SBA OIG, and Postal Inspection Service.For instance, in the Western District of Texas covering Austin, San Antonio and Waco, U.S. Attorney Ashley Hoff announced charges last year against two area residents who allegedly obtained $1.98 million in PPP and EIDL loans by fabricating payroll, employees, and revenue figures. According to the indictment, one defendant used the loan proceeds to purchase a Lamborghini Urus sports car.