new york ppp and eidl loan fraud lawyers

Thanks for visiting Federal Lawyers. We’re a second-generation law firm managed by our lead attorney – with over 40 years of combined experience defending federal criminal cases throughout New York and nationwide. If you’re facing a PPP or EIDL loan fraud investigation in New York, you’re dealing with serious federal charges in one of the most aggressive prosecution districts in the country. The Southern District of New York, Eastern District, Northern District, and Western District have all made pandemic loan fraud enforcement a top priority.

New York City, Long Island, Albany, Buffalo, Rochester – we’re seeing cases across the state. The exposure is significant: wire fraud carries 20 years in federal prison, bank fraud carries 30 years, and making false statements carries 5 years. And federal prosecutors in New York aren’t just targeting obvious fraud schemes – they’re scrutinizing legitimate business owners who inflated payroll numbers, who misunderstood eligibility requirements, who used funds in ways they thought were acceptable but technically weren’t.

Why New York Has So Many PPP Fraud Prosecutions

New York saw massive PPP and EIDL loan volume during the pandemic. The state was hit hard by shutdowns – restaurants closed, retail stores struggled, professional services went remote. Businesses desperately needed emergency funding. The SBA distributed billions in loans across New York. Now federal investigators – working with the SBA Office of Inspector General, FBI, and IRS Criminal Investigation – are auditing those loans systematically.

The Southern District of New York, which covers Manhattan, the Bronx, and parts of surrounding counties, is particularly aggressive. SDNY prosecutors have a reputation for pursuing high-profile fraud cases, and they’ve devoted significant resources to PPP fraud prosecutions. The Eastern District, covering Brooklyn, Queens, Long Island, and Staten Island, has been similarly aggressive. The Northern and Western Districts covering upstate New York have also charged numerous defendants.

What Triggers an Investigation

The SBA flags your loan for audit. Maybe there’s a discrepancy between your application and your forgiveness request. Maybe your loan amount seems disproportionate to your reported 2019 revenue. Maybe you received multiple loans. Maybe an algorithm identifies unusual patterns. Maybe someone – a disgruntled employee, a former business partner, a competitor – tips off investigators. That referral goes to federal investigators who spend months building a case before you ever know they’re looking at you.

They compare your application against your tax returns. They match claimed payroll numbers against actual payroll records from ADP, Paychex, or whatever service you use. They track where funds went by reviewing your business bank accounts transaction by transaction. They interview your employees. They sometimes conduct surveillance on your business. By the time they contact you, they’ve already gathered extensive evidence and formed conclusions about your guilt.

Common allegations in New York cases: you inflated your employee count to qualify for a larger loan. You claimed your business was operational before February 2020 when it wasn’t. You used EIDL funds for personal expenses instead of business purposes. You received both PPP and EIDL funding but didn’t disclose one on the other application. You certified you had no delinquent federal debts when you did. These are the actual allegations we see.

DEFENSE TEAM SPOTLIGHT

Todd Spodek

Lead Attorney & Founder

Featured on Netflix's "Inventing Anna," Todd Spodek brings decades of high-stakes criminal defense experience. His aggressive approach has secured dismissals and acquittals in cases others deemed unwinnable.

NY Bar Admitted Multi-State Licensed Federal Courts

Meet the Full Team

The Federal Investigation Process in New York

Most New York defendants we work with had no idea they were under investigation until federal agents showed up or they received a target letter. The investigation phase happens quietly over many months. The SBA audits your loan. The Office of Inspector General reviews the file. Investigators pull your financial records, talk to your employees, review your tax returns for the past five years.

Legal Scenario: What Would You Do?

Scenario

You submitted a PPP loan application during COVID and now realize some employee count numbers may have been inaccurate.

Could this be considered fraud?

Attorney's Answer

Inaccuracies in PPP applications can trigger federal fraud charges carrying up to 20 years in prison. However, honest mistakes differ from intentional misrepresentation. Documentation of your good-faith efforts is critical to your defense.

This is general information only. Contact us for advice specific to your situation.

Then they reach out. Federal agents might call you asking to “discuss your loan application.” They might show up at your business or home – and in New York, they often show up early in the morning for maximum impact. You might receive a grand jury subpoena demanding documents. Or you could get a target letter from the U.S. Attorney’s Office stating you’re under investigation and inviting you to make a statement.