NATIONALLY RECOGNIZED FEDERAL LAWYERS
Last Updated on: 13th September 2023, 05:17 pm
Handling PPP and EIDL Fraud Investigations in LA: What to Know
When COVID hit, the government gave out billions in PPP and EIDL loans to help businesses. But now prosecutors are looking into potential fraud cases across the country, including here in LA.
If you got a letter from the SBA or federal agents about your loans, it’s time to call a lawyer. Let’s break down what’s going on and how to protect yourself.
The Most Common Types of Alleged Fraud
Prosecutors claim many folks misused their loan money. Some examples according to the Department of Justice:
- Applying for loans for fake businesses
- Hiding the money in personal accounts
- Lying about payroll or employees
- Spending it on personal stuff
- Getting multiple loans from different lenders
They’re using charges like wire fraud, bank fraud, and money laundering. Penalties can be harsh if the alleged fraud is large.
What to Do When Federal Agents Knock
If agents show up asking questions, politely refuse to talk without a lawyer. They may pressure you, but you have rights against self-incrimination.
In EIDL and PPP cases, beware agents might:
- Demand paperwork and try to search your home or business
- Send subpoenas requesting your financial records
- Have people secretly record you
- Threaten immediate arrest if you don’t cooperate
Don’t fall for it. Say you won’t answer anything without an attorney and contact one ASAP.
Building a Strong Defense
Prosecutors win over 90% of their cases because most people can’t afford a solid legal defense. But an experienced lawyer can find holes in their case.
Possible defenses include:
- You didn’t intend fraud, just made mistakes
- You used the money properly
- No proof you knew about or were involved in fraud
- Agents violated your rights
- Mental issues affected your judgment
A lawyer may also be able to negotiate a favorable deal with less penalties. They can advise if it’s better to take a plea bargain or go to trial.
If you’re being investigated for PPP or EIDL fraud, here are some tips:
- Don’t talk to agents without an attorney
- Hire a lawyer immediately to protect your rights
- Follow their advice on responding to investigators
- Don’t destroy any records requested
- Have your lawyer contact prosecutors to present your side
- Be patient – this can be a lengthy process
Choosing the Right Fraud Lawyer in LA
Facing federal fraud charges is scary. Protect yourself by hiring a lawyer with specific experience defending LA PPP and EIDL cases. They’ll understand how local prosecutors work and may have connections to aid plea negotiations. Their expertise with the process, laws, and defense tactics could make all the difference.
Don’t wait to bring in counsel if you think your loans are being probed. An attorney can guide you on responding to investigators and negotiate with prosecutors before charges are even filed. This could help resolve the case without criminal penalties. When dealing with the feds, every day is crucial so act fast.
Fighting PPP and EIDL Fraud Charges in Los Angeles
Getting accused of COVID relief fraud is scary. The feds don’t mess around. Some business owners are facing years behind bars and fines in the millions for allegedly abusing programs like the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) program.
This article will give you the lowdown on how these cases work in LA, talk about ways a good lawyer can defend you, and give tips on finding the right attorney. I’m not going to use a bunch of legal mumbo-jumbo. I’ll explain things in simple terms, like I’m talking to a friend who’s worried they might get charged.
What Are the PPP and EIDL Programs?
When COVID hit in 2020, the government created the PPP and expanded the existing EIDL program to get emergency money to struggling businesses fast.
PPP loans were supposed to cover payroll and other expenses for 8 weeks. If you kept your employee headcount, the loan could be 100% forgiven. EIDLs provided low-interest loans up to $2 million for operating costs. EIDL advances up to $10k didn’t have to be paid back.
By mid-2021, the Small Business Administration (SBA) had approved over $800 billion in PPP loans and $200 billion in EIDL loans and advances. But watchdogs estimate around $100 billion was obtained through fraud.
How Are They Catching People in LA?
Federal prosecutors in the Central District of California – covering LA and nearby counties – are super aggressive about going after COVID relief fraud.
Between 2020 and 2022, they charged over 100 people just in the LA area for allegedly scoring over $150 million in fake pandemic loans.
Some of the schemes they’re accusing defendants of:
Using stolen IDs or making up fake businesses to apply
Lying about number of employees, payroll, taxes, etc.
Getting multiple loans for shell companies
Spending loan money on themselves
Working with shady loan officers
Lots of cases involve groups submitting hundreds of bogus applications seeking tens of millions in loans.
What Laws Are They Using to Bring Charges?
Prosecutors typically go after defendants for pandemic loan fraud using felony federal charges that can really stick it to you:
Wire fraud – Up to 20 years in prison
Bank fraud – Up to 30 years in prison
Aggravated identity theft – Extra mandatory 2 years in prison
False statements – Up to 5 years in prison
Money laundering – Up to 20 years in prison
If convicted, you can also get slammed with massive fines up to $250,000 per count. With the huge loan amounts, penalties can easily hit the millions.
Fighting Back Against the Charges
The potential prison time and fines are scary. But an experienced criminal defense lawyer can look closely at the facts and law to build strong defenses. Some options:
You didn’t mean to defraud anyone – it was just mistakes or confusion when applying.
The bogus info wasn’t a big deal and didn’t really affect the loan.
You didn’t intentionally try to deceive the lenders.
You got pushed into it by undercover agents or informants.
You were forced into the scheme with threats.
The laws they charged you under are too vague.
You’re being unfairly singled out when others did the same thing.
They waited too long – the deadline to prosecute passed.
They obtained evidence illegally.
The feds don’t have jurisdiction over these alleged crimes.
You desperately needed the money to save your business and employees.
You relied on bad advice from professionals like lawyers or accountants.
The evidence just isn’t strong enough to prove your guilt.
Finding the Right Lawyer in LA
Getting hit with federal charges is terrifying. Picking the right lawyer is crucial. Look for someone with a ton of experience defending white collar cases in LA federal courts. They’ll understand how things work locally and have connections.
Ask about their track record getting charges dropped before trial, keeping defendants out of prison, and working out good plea deals. Make sure they have specific experience with PPP and EIDL fraud cases and defenses.
A great lawyer will dig deep into the loan applications, bank statements, emails and texts, and anything else to build the strongest case for you. Don’t be shy about getting quotes from several lawyers before deciding who to hire.
The Bottom Line
PPP and EIDL fraud allegations are super serious with how much prison time and money is on the line. But a smart lawyer who knows federal cases can often get charges reduced or even dismissed. Don’t leave your business and freedom in the hands of some random attorney.