Pennsylvania PPP – SBA – EIDL Loan Fraud Lawyers

Fighting Back Against PPP and EIDL Fraud Charges in Pennsylvania

The COVID pandemic led the government to create programs like the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) program. These provided billions in forgivable loans and grants to small businesses and workers. But the rush to roll them out also led to a lot of fraud. Now prosecutors are going after people for PPP and EIDL fraud through criminal charges. If you or your business is being investigated or charged, it’s crucial to have an experienced federal criminal defense attorney on your side. This article will give you an overview of Pennsylvania PPP and EIDL fraud laws, defenses, and what it all means.

The Main PPP and EIDL Fraud Charges

Prosecutors charge PPP and EIDL fraud under a bunch of federal criminal laws. The most common charges are:

• Bank fraud – Lying to get PPP or EIDL money from an FDIC-insured bank or credit union. This includes making up payroll numbers, number of employees, and fake documents. Charged under 18 U.S.C. § 1344.
• Wire fraud – Using the internet to carry out a scheme to defraud the PPP or EIDL program. For instance, submitting false online loan applications, fake payroll records, etc. Charged under 18 U.S.C. § 1343.
• Mail fraud – Using the mail to commit PPP or EIDL fraud. Like mailing falsified tax papers to back up a fraudulent loan application. Charged under 18 U.S.C. § 1341.
• False statements – Knowingly making false claims in PPP or EIDL loan applications and documents. Charged under 18 U.S.C. § 1001.
• Aggravated identity theft – Using someone else’s personal information like name, social security number, etc. without permission to commit PPP or EIDL fraud. Charged under 18 U.S.C. § 1028A.

Prosecutors often pile on multiple charges based on what the alleged fraud was. The potential penalties can be severe depending on the amount stolen. Even first-timers could be facing years behind bars.

Common PPP and EIDL Fraud Schemes

Here are some of the most common fraudulent schemes prosecutors are going after:

• Fake payroll/employees – Making up high payroll expenses and number of employees to get bigger PPP loans. This includes fabricated payroll reports and tax papers.
• Identity theft – Using stolen personal info to apply for PPP or EIDL loans under fake businesses or someone else’s name.
• Multiple loans – Getting multiple PPP loans for the same business by submitting applications with different lenders.
• Ineligible businesses – PPP and EIDL loans were meant for real small businesses. Submitting applications for shell companies, fake businesses, or ineligible categories is fraud.
• Unqualified expenses – Spending PPP funds on personal purchases, payments to family, or other costs unrelated to payroll and operations.

These are just some examples. Prosecutors are looking at all kinds of ways people abused or misused these emergency loan programs.

Fighting Back Against PPP and EIDL Fraud Charges

An experienced federal criminal defense lawyer can raise good defenses to PPP and EIDL fraud charges like:

• No criminal intent – The government must prove you knowingly and intentionally committed fraud. Mistakes or errors in loan applications aren’t necessarily fraud.
• Coercion – Someone else pressured you into a fraudulent scheme through threats or force.
• Good faith – You honestly but mistakenly thought your actions were legal and met the requirements.
• Immaterial false statements – Any lies didn’t actually impact the lender approving the loan.

A lawyer can also scrutinize how strong the government’s evidence really is. For example, paperwork mistakes may look bad but could just be clerical errors. Or accounting issues aren’t necessarily proof of phony documents. Prosecutors often portray ambiguous evidence in the worst light. A defense attorney can prevent you from being wrongly convicted based on exaggerated or misleading accusations.

Sentencing Possibilities for PPP and EIDL Fraud

If convicted of PPP, EIDL, or other federal fraud charges, the court will impose a sentence based on factors under 18 U.S.C. § 3553. These include:

• Federal sentencing guidelines – Recommended sentencing range based on the crime and criminal history.
• Statutory maximums – The maximum jail term set by law for each offense.
• Mitigating circumstances – Reasons for a more lenient sentence like no criminal record, family obligations, health issues, charitable works, etc.
• Restitution – Repaying victims, usually the amount of funds stolen.

A lawyer can present mitigating factors and argue for sentencing departures and variances under the guidelines. Depending on the situation, alternatives to prison like probation or home confinement may be possible.