Mar 21, 2024

South Dakota PPP – SBA – EIDL Loan Fraud Lawyers

South Dakota PPP – SBA – EIDL Loan Fraud Lawyers

The COVID-19 pandemic led to major economic disruption across the United States, with many businesses struggling to stay afloat. To provide relief, the federal government created several loan programs like the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan program (EIDL). These programs distributed billions of dollars in emergency loans to small businesses and nonprofits. However, the rush to get money out led to limited oversight and ripe conditions for fraud.

Now federal investigators are scrutinizing PPP and EIDL loans for fraud. If you or your business in South Dakota received one of these loans, you could face serious charges if something was amiss in your application or use of funds. An experienced white collar criminal defense lawyer can protect your rights. Let’s examine issues around PPP and EIDL fraud allegations in South Dakota.

South Dakota PPP Loan Fraud

The Paycheck Protection Program distributed huge sums of money to businesses and nonprofits as potentially forgivable loans. To get a PPP loan forgiven, borrowers had to use at least 60% on payroll and 40% on other approved expenses like rent and utilities. With limited vetting on applications, some applicants saw it as free money without enough accountability.

PPP loan fraud can include a range of activities like:

• Lying on a PPP loan application about number of employees, payroll expenses, or other information to get a larger loan amount or increased chance of approval
• Using PPP funds for prohibited purposes like personal expenses instead of approved costs like payroll and rent
• Applying for and receiving multiple PPP loans by using different business names or other tricks
• Colluding with a lender to rubber stamp a fraudulent PPP loan application

PPP loan fraud is a federal offense. The U.S. Department of Justice is aggressively pursuing PPP fraud cases and has already charged hundreds of individuals and companies. Penalties can include:

• Repayment of the full PPP loan amount
• Fines equal to the amount of the PPP loan funds or up to $1 million
• Up to 30 years in federal prison for felony fraud

In addition to criminal prosecution, PPP borrowers could face civil lawsuits or administrative enforcement from the Small Business Administration (SBA) or their lender. It’s essential to consult an experienced attorney if you’re under PPP fraud investigation.

South Dakota EIDL Fraud

The SBA’s Economic Injury Disaster Loan program also distributed billions in COVID relief funds to small businesses and nonprofits. These loans have attractive terms like 3.75% interest and 30-year repayment periods. But with so much money going out so quickly, fraud was rampant.

EIDL fraud issues may include:

• Falsely claiming on an EIDL application that COVID-19 severely impacted your business revenues
• Using an EIDL loan for personal purchases instead of approved business expenses
• Applying for multiple EIDL loans using fake businesses or stolen identities
• Colluding with an SBA employee to facilitate fraudulent EIDL loan approvals

As with PPP loans, EIDL fraud carries severe consequences like:

• Full repayment of the EIDL loan
• Fines equal to the loan amount or up to $1 million
• Up to 30 years imprisonment for felony fraud

EIDL borrowers face criminal prosecution, civil lawsuits, or SBA enforcement actions for fraud. These are serious matters that call for an attorney’s help.

Defenses Against SBA Loan Fraud Charges in South Dakota

The government has to prove its case if you’re accused of PPP or EIDL fraud. An experienced lawyer can evaluate if you have defenses like:

• Lack of intent – The government must prove you knowingly committed fraud instead of making an honest mistake.
• Coercion – Someone else pressured you into fraudulent activities.
• Minimal harm – The dollar amounts were small and quickly repaid.

Other defenses depend on the specifics of your case. For instance, you could argue the loan funds were in fact used properly for payroll or other approved expenses. Or claim another party submitted a fraudulent application without your knowledge. The right lawyer understands SBA program rules and how to build a defense.

Choose an Experienced SBA/PPP Fraud Lawyer in South Dakota

Dealing with allegations of PPP or EIDL loan fraud is scary. But an experienced federal defense lawyer can protect your rights and future. Look for a lawyer with specific experience defending SBA fraud cases. They will know how these complex investigations work and the most effective defense strategies.

A skilled attorney can also negotiate with prosecutors or initiate an independent investigation. Their goal is getting charges reduced or dismissed, fines minimized, and avoiding jail time. If you or your South Dakota business is under investigation for PPP or EIDL fraud, time is of the essence. Consult a seasoned criminal defense lawyer right away before making any statements to investigators.

With an attorney’s guidance, you can move forward and put these SBA fraud allegations behind you. Don’t wait to seek experienced legal representation.

South Dakota PPP – SBA – EIDL Loan Fraud Lawyers