How Much Jail Time for $50 Million in PPP Loan Fraud?

How Much Jail Time for $50 Million in PPP Loan Fraud?

The Paycheck Protection Program (PPP) was created in 2020 as part of the CARES Act to provide forgivable loans to small businesses impacted by the COVID-19 pandemic. However, amid the rushed rollout and lack of oversight, an estimated $200 billion was fraudulently obtained from the $800 billion program.

One of the most high-profile PPP fraud cases involved a California man who was sentenced to over 11 years in prison for seeking $27 million in PPP loans. So how much jail time could someone face for $50 million in attempted PPP loan fraud?

Federal Charges and Penalties

There is no singular charge for PPP loan fraud. Prosecutors typically bring charges under pre-existing federal fraud statutes, such as:

• Bank Fraud – Up to 30 years in prison and $1 million fine (18 USC § 1344)
• Wire Fraud – Up to 20 years in prison (18 USC § 1343)
• Making False Statements – Up to 30 years in prison and $1 million fine (18 USC § 1014)
• Aggravated Identity Theft – Mandatory 2 years in prison consecutive to any other sentence (18 USC § 1028A)

Prosecutors can also bring charges of conspiracy, attempt, money laundering, and tax evasion depending on the specifics of the PPP fraud scheme.

Sentencing Guidelines

If convicted, federal sentencing guidelines will determine the final prison sentence based on:

• The amount of intended loss from the fraud
• The number of victims
• The sophistication of the fraud
• Whether the defendant had a leadership role
• Whether the defendant has a criminal history
• Whether the defendant accepts responsibility

The amount of intended loss drives up the sentence the most. For $50 million in attempted fraud, the recommended sentence could easily exceed 10 years in prison under the guidelines.

Notable PPP Fraud Sentences

Some recent significant PPP fraud sentences include:

• 11+ years in prison for $27 million in attempted fraud (California man)
• 9 years in prison for $2.6 million in actual loss (Seattle business owners)
• 8 years in prison for $1.1 million in actual loss (Michigan pharmacist)

Given these sentences and the sentencing guidelines, $50 million in attempted PPP loan fraud would likely result in around 15 years in federal prison if convicted.

Defense Strategies

An experienced federal defense lawyer can argue for a lower sentence by:

• Negotiating with prosecutors for reduced or dropped charges
• Challenging evidentiary issues and improper government conduct
• Presenting mitigating personal and medical circumstances
• Highlighting a minor role in the offense
• Demonstrating acceptance of responsibility and cooperation

It’s also possible in some cases to negotiate non-prosecution or deferred prosecution agreements that avoid any criminal conviction.

Ultimately, each PPP fraud case has unique facts that determine the final outcome. But the penalties can be severe, particularly with large fraud amounts, so seeking experienced legal representation right away is critical.

For more information on potential defenses and outcomes for PPP fraud charges, see resources like r/EIDLPPP on Reddit, Avvo, LawInfo, FindLaw, and FederalLawyers.com.