Pennsylvania PPP and EIDL 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 an SBA audit letter, a federal subpoena, or investigator contact about your PPP or EIDL loan – you’re facing a federal investigation. Pennsylvania has seen aggressive federal prosecution of pandemic loan fraud cases in Philadelphia, Pittsburgh, and Harrisburg.

This article covers PPP and EIDL fraud charges in Pennsylvania, how federal investigations work, penalties you face, and what to do immediately. We represent clients in Pennsylvania’s Eastern, Middle, and Western Districts.

PPP and EIDL Fraud Prosecutions in Pennsylvania

Pennsylvania’s three federal districts – Eastern (Philadelphia), Middle (Harrisburg), and Western (Pittsburgh) – have prosecuted hundreds of pandemic loan fraud cases since 2020. The SBA Office of Inspector General identified billions in potentially fraudulent loans statewide. Federal prosecutors work with the FBI, IRS Criminal Investigation, and SBA investigators.

PPP and EIDL loans served different purposes. PPP covered payroll costs to keep employees working. EIDL provided economic injury disaster loans for operating expenses. Both programs required truthful applications. Lying on either – about your business, employees, revenue, or how you spent funds – is federal fraud.

Investigators prioritize larger loans but prosecute smaller amounts too. They cross-reference your applications with IRS tax returns, state employment records, banking data, and credit reports. Discrepancies trigger investigations. Maybe you inflated payroll on your PPP application. Maybe you claimed higher revenue on your EIDL application than you reported to the IRS. Maybe you applied using fake businesses. Maybe you spent the money on personal expenses.

Federal Charges You’re Facing

Wire fraud is the primary charge. Submitting electronic loan applications uses interstate wire communications – that’s 18 U.S.C. § 1343, carrying up to 20 years in prison.

Bank fraud applies when you lie to financial institutions. That’s 18 U.S.C. § 1344 – maximum 30 years in prison and $1 million in fines.

Making false statements to the SBA violates 18 U.S.C. § 1014. If you lied about employee counts, payroll expenses, revenue, or business eligibility – you’re facing 30 years in prison.

Money laundering charges get added when you moved funds between accounts, transferred money overseas, or attempted to hide spending. That’s 18 U.S.C. § 1956 – up to 20 years.

Conspiracy charges apply when anyone else was involved – accountants, business partners, loan brokers. If they helped prepare false documents or knew about inflated numbers, prosecutors charge conspiracy. Conspiracy carries the same penalties as the underlying fraud.

Intent Requirements

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 $500,000 in payroll when you actually paid $200,000? You knew that was wrong. You claimed $1 million in annual revenue when your tax returns showed $400,000? You knew that was false. Federal prosecutors don’t need to prove you’re a mastermind – just that you lied deliberately.

How Federal Investigations Work

Investigators start with your bank accounts. They subpoena every transaction in your business and personal accounts for 2019 through 2021. They’re analyzing how you spent PPP and EIDL funds – looking for personal purchases, luxury items, transfers to family.

Next they pull your tax returns. Your 2019 and 2020 returns show actual payroll costs and revenue. If your loan applications claimed higher amounts – that’s documentary evidence of fraud.

They interview employees, former employees, vendors, landlords – anyone who can verify your business operations. If you claimed 25 employees but investigators find only 10 – that’s fraud.

Forensic accountants review your spending patterns. PPP funds were meant for payroll, rent, utilities. EIDL funds covered working capital, accounts payable, fixed debts. If you bought cars, boats, jewelry, or vacations – prosecutors will argue you never intended to use funds properly.

Sentencing in Pennsylvania PPP and EIDL Cases

Federal sentencing guidelines calculate punishment based on loss amount. Fraud involving $150,000 to $250,000 significantly increases sentencing ranges. Over $550,000 – you’re looking at years in federal prison.

Acceptance of responsibility matters. If you cooperate, admit wrongdoing, and accept a plea deal early – judges can reduce sentences by up to 30%. If you go to trial and lose – you get the maximum.

Recent Pennsylvania sentences show the pattern. A Philadelphia defendant who obtained $800,000 in PPP and EIDL loans using fake documents got 48 months. A Pittsburgh business owner who lied about payroll to get $300,000 received 30 months. A Harrisburg defendant who submitted false revenue information got 24 months.

Restitution is mandatory – you must repay every dollar. Fines range from $250,000 for individuals to $500,000 for organizations. Asset forfeiture is common – the government seizes property purchased with fraudulent funds.

What to Do When Contacted

Don’t talk to federal agents without a lawyer. If FBI or IRS agents show up asking about your PPP or EIDL loan – don’t answer questions. Don’t try to explain. Everything you say becomes evidence. Politely decline and contact a federal defense attorney immediately.

If you receive a grand jury subpoena – prosecutors are presenting evidence to get an indictment. You need legal representation before producing documents.

Target letters formally notify you that you’re under investigation. If you receive one – prosecutors are considering charges and may negotiate before indicting.

Why We Handle Federal PPP and EIDL 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. That generational experience matters.

Our team includes former federal prosecutors who 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 and EIDL fraud cases in Philadelphia, Pittsburgh, Harrisburg, and throughout Pennsylvania’s federal districts. We’re available 24/7.

Our Defense Strategy

We investigate before the government finishes investigating. When you hire us during the investigation stage – we can sometimes prevent charges entirely. We submit presentations to federal prosecutors explaining why evidence doesn’t support fraud charges.

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 program rules?

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.

Some cases should go to trial. When evidence is weak, when intent is genuinely missing – we try cases.

Pennsylvania PPP and EIDL loan fraud investigations are serious federal prosecutions. If you’re being investigated or facing charges – call us immediately.