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Florida PPP – SBA – EIDL Loan Fraud Lawyers

March 21, 2024 Uncategorized

Florida PPP Loan Fraud Lawyers

The Paycheck Protection Program (PPP) was created in 2020 as part of the CARES Act to provide small businesses with loans to help them stay afloat during COVID-19 shutdowns. The loans were designed to cover payroll, rent, utilities and other expenses. The expectation was that the loans would help keep employees on payroll and allow businesses to quickly ramp up once the pandemic passed.

The loans came with an important provision – they could be entirely forgiven if the borrower used at least 60% of the funds toward payroll costs. This forgiveness clause made the loans very appealing to small business owners who were facing steep revenue declines. However, it also created an opening for abuse and fraud given the rush to get funds out the door.

Now, federal prosecutors are going after those who they believe intentionally misused PPP funds or made false statements on their loan applications. Charges range from wire fraud, bank fraud and making false statements to lenders. Defendants face hefty fines and years in prison if convicted.

For small business owners caught up in these allegations, having an experienced white collar defense lawyer can mean the difference between avoiding criminal charges altogether versus a felony conviction that could ruin their business and personal finances. Here’s an overview of PPP loan fraud issues and how a qualified legal team can help.

Where Are Most PPP Fraud Cases Occurring in Florida?

Florida is among the states with a high number of PPP fraud-related prosecutions. The U.S. Attorney’s Office in South Florida, which covers the Miami metro area, has been particularly active. Prosecutors have charged dozens of individuals and entities with PPP loan fraud over the past two years. Central Florida, including the Orlando and Tampa areas, has also seen numerous cases.

Federal investigators are data mining loan applications looking for red flags like:

  • Loans deposited into personal accounts rather than business accounts
  • Funds used to buy luxury items, pay off debts or other unauthorized purposes
  • Fake or inflated payroll numbers on applications
  • Multiple loans obtained for the same business
  • Loans obtained for fake or inactive businesses
  • Borrowers with criminal records for financial crimes applying for loans

U.S. Attorney Juan Antonio Gonzalez has said South Florida is a hotbed for fraud in part because of the large number of small businesses in the region. Palm Beach, Broward and Miami-Dade counties received nearly 100,000 PPP loans worth over $10 billion. When that much money is distributed quickly, prosecutors expect a certain level of fraud will occur.

PPP Loan Fraud Charges Being Pursued in Florida

Federal prosecutors are building cases using charges such as:

Wire fraud – Using electronic communications to execute or attempt to execute a scheme to defraud. This includes email, phone calls, electronic fund transfers etc.

Bank fraud – Scheme to defraud a financial institution or obtain money under its control through false or fraudulent representations.

Making false statements to a lending institution – Providing false information to a bank or other lending institution to influence a loan decision.

Money laundering – Engaging in transactions involving funds obtained illegally to conceal their criminal source.
Aggravated identity theft – Using someone else’s personal identifying information without authorization as part of a crime.

These white collar offenses can lead to serious penalties if not properly defended against. Wire fraud and bank fraud each carry a maximum sentence of 30 years in prison and a $1 million fine. False statements can lead up to 30 years and $1 million per statement. Money laundering carries up to 10 years per count. Aggravated identity theft has a mandatory minimum 2 year prison sentence.

In addition to criminal prosecution, the government can pursue civil charges against PPP fraudsters to recoup funds. The Small Business Administration has already clawed back misused loans through debt collection proceedings. Borrowers can be ordered to repay loans plus interest, fees and other costs.

How an Experienced Attorney Can Defend PPP Fraud Cases

When facing PPP loan fraud accusations, it’s essential to engage an attorney experienced in complex white collar criminal defense as early in the process as possible. An experienced federal crimes lawyer can often intervene before charges are filed to convince prosecutors not to pursue a case.

Once charges are filed, an attorney’s in-depth knowledge of federal law and prosecution procedures becomes vital. For example, they will look for illegal searches or other constitutional violations that could result in evidence being suppressed or thrown out.

An effective defense lawyer will also thoroughly examine the paper trail to look for inaccuracies, missing documentation and other lapses that undermine the prosecution’s case. They can often demonstrate a client acted in good faith and did not intentionally mislead lenders. Negotiating a plea deal or seeking charge dismissals are other avenues skilled counsel can pursue.

If a trial becomes necessary, federal crime lawyers have the courtroom skills to counter prosecution arguments and present exculpatory evidence. Their relationships with expert witnesses can also bolster the defense.

Key Ways a Strong Legal Defense Can Beat PPP Fraud Charges

Suppress evidence obtained illegally – An experienced attorney will look for 4th Amendment violations and other procedural errors to get damning evidence barred from trial.

Attack flaws in prosecution’s case – By relentlessly picking apart the prosecution’s position, an attorney can often raise sufficient doubt for acquittal.

Negotiate plea deal – An attorney may be able to negotiate a plea to reduced charges or secure a favorable sentencing recommendation.

Seek charge dismissals – By highlighting problems with the government’s legal theory or evidence, charges can potentially be dismissed.

Present exculpatory evidence – A skilled lawyer will seek out evidence and witnesses to counter prosecution arguments.

Raise improper government conduct – Unscrupulous tactics by investigators can sometimes lead to charges being dismissed.

Develop technical arguments – Nuanced legal arguments can be made around things like statute of limitations, entrapment, federal jurisdiction etc.

Present mitigating circumstances – The defense can raise justifications, explanations and mitigating factors to reduce culpability.

Advocate for diversion programs – First offenders may be able to avoid prosecution by completing programs like pretrial diversion.

Argue against incarceration – The defense can advocate for probation, home confinement or other alternatives to imprisonment.

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