new jersey ppp loan fraud lawyers
New Jersey PPP Loan Fraud Lawyers
Thanks for visiting Spodek Law Group – a second-generation law firm managed by Todd Spodek, with over 40 years of combined experience in federal criminal defense. If you received a subpoena, a target letter from federal prosecutors, or an SBA audit notice about your PPP loan – you’re facing a federal investigation. PPP fraud prosecutions are increasing in New Jersey, and federal prosecutors in Newark and Trenton are aggressively pursuing cases.
This article covers PPP loan fraud charges in New Jersey, how federal investigations work, what penalties you face, and why you need experienced federal defense counsel immediately. We represent clients in New Jersey’s federal district courts and nationwide.
New Jersey’s PPP Fraud Prosecution Landscape
The District of New Jersey – covering Newark, Trenton, and Camden – has prosecuted hundreds of PPP fraud cases since 2020. Federal prosecutors work with the FBI, IRS Criminal Investigation, and the SBA Office of Inspector General. They target loans over $150,000 but also prosecute smaller amounts when fraud is obvious.
New Jersey saw significant PPP fraud activity because of its proximity to New York City and its large small business population. The SBA identified billions in potentially fraudulent loans in the region. Federal investigators cross-reference your PPP application with IRS tax returns, state employment records, and banking data. When discrepancies appear – you get investigated.
Your loan gets flagged for several reasons. Maybe you inflated employee counts or payroll expenses. Maybe you claimed your business existed when it didn’t. Maybe you applied for multiple loans using different businesses. Maybe you spent PPP money on personal expenses instead of payroll and rent. Any of these triggers an investigation.
Federal Charges in PPP Fraud Cases
Wire fraud is the primary charge. When you submitted your PPP application electronically or by email, you used interstate wire communications. That’s 18 U.S.C. § 1343 – wire fraud carrying up to 20 years in prison.
Bank fraud comes next. Lying to a financial institution about your business, payroll, or loan eligibility is bank fraud under 18 U.S.C. § 1344. Maximum penalty: 30 years in prison and a $1 million fine.
Making false statements to the SBA is charged under 18 U.S.C. § 1014. If you lied about employee numbers, payroll costs, or whether your business qualified for a loan – that’s a federal crime carrying 30 years in prison.
Money laundering charges get added when you transferred PPP funds between accounts, moved money overseas, or tried to hide how you spent the funds. That’s 18 U.S.C. § 1956 – up to 20 years.
Conspiracy charges apply when anyone else was involved – your accountant, a business partner, a loan broker. If they helped you prepare false documents or knew about inflated numbers, prosecutors charge conspiracy to commit fraud. Conspiracy carries the same penalties as the underlying crime.
What Prosecutors Must Prove
Intent matters. Prosecutors must prove you knowingly made false statements. “Knowingly” means you understood the information was false when you submitted it – not that you understood it was illegal.
You claimed $800,000 in payroll when you actually paid $300,000? You knew that number was wrong. You listed 40 employees when you only had 15? You knew that was false. Prosecutors don’t need to prove you’re a criminal mastermind – they just need to prove you lied deliberately.
How Federal Investigators Build Cases
They start with your bank accounts. Federal agents subpoena every transaction in your business and personal accounts for 2019 through 2021. They’re analyzing how you spent PPP money – looking for personal purchases, luxury items, transfers to family members.
Next they pull your tax returns. Your 2019 tax return shows your actual payroll costs. If your PPP application claimed higher amounts – that’s documentary evidence of fraud.
They interview your employees, former employees, vendors – anyone who can confirm whether your business operated as claimed. If you said you had 30 employees but investigators find only 12 – that’s fraud.
Forensic accountants review your spending patterns. PPP funds were meant for payroll, rent, utilities. If you bought cars, boats, or jewelry – prosecutors will argue you never intended to use the money properly.
Sentencing in New Jersey PPP Cases
Federal sentencing guidelines calculate punishment based on loss amount. Fraud involving $150,000 to $250,000 significantly increases your sentencing range. Over $550,000 – you’re looking at years in federal prison.
Acceptance of responsibility matters enormously. If you cooperate, admit wrongdoing, and accept a plea deal early – judges can reduce your sentence by up to 30%. If you go to trial and lose – you get the maximum.
Recent New Jersey sentences show the pattern. A Newark business owner who fraudulently obtained $600,000 got 36 months. A Trenton defendant who lied about employee numbers to get $250,000 received 24 months.
Restitution is mandatory – you must repay every dollar. Fines range from $250,000 for individuals to $500,000 for organizations.
What to Do When Investigators Contact You
Don’t talk to federal agents without a lawyer. If FBI or IRS agents show up asking about your PPP loan – don’t answer questions. Don’t explain. Everything you say becomes evidence. Politely decline to speak and contact a federal defense attorney immediately.
If you receive a grand jury subpoena – that means prosecutors are presenting evidence to get an indictment. You need legal representation before producing any documents.
Target letters formally notify you that you’re under investigation. If you receive one – it means prosecutors are considering charges and may be willing to negotiate.
Why We Handle Federal PPP Fraud Cases
Spodek Law Group has represented clients in federal prosecutions since 1976. Todd Spodek’s father founded this firm – Todd grew up in federal courtrooms watching criminal trials.
Our team includes former federal prosecutors. They worked fraud investigations from the government side – they know how prosecutors think, what evidence they need, what weaknesses exist in cases.
We’ve handled high-profile federal cases. Todd Spodek represented Anna Delvey in her fraud prosecution – a case that became a Netflix series. We represented the Ghislaine Maxwell juror in his misconduct case.
We handle PPP fraud cases in Newark, Trenton, Camden, and throughout New Jersey’s federal district. We’re available 24/7.
Our Defense Approach
We investigate before the government finishes investigating. When you hire us during the investigation stage – before charges are filed – we can sometimes prevent prosecution entirely. We submit presentations to federal prosecutors explaining why the evidence doesn’t support fraud charges or why errors were innocent mistakes.
If charges are filed, we challenge every element. Did you actually make false statements, or did you rely on your accountant? Did you have fraudulent intent, or did you misunderstand complex PPP rules? These challenges affect charges and sentencing.
We negotiate aggressively. Federal prosecutors want convictions – they’ll consider deals that reduce charges and recommend lower sentences. We’ve gotten serious fraud charges reduced. We’ve secured probation instead of prison time.
Some cases should go to trial. When the evidence is weak, when intent is genuinely missing – we try cases.
New Jersey PPP loan fraud investigations are serious federal prosecutions. If you’re being investigated or facing charges – call us immediately.