Raleigh PPP and EIDL Loan Fraud Lawyers

Thanks for visiting Spodek Law Group, a second-generation criminal defense firm managed by Todd Spodek – with over 50 years of combined experience defending federal fraud cases nationwide. If you’re facing PPP or EIDL fraud charges in Raleigh, you’re dealing with federal prosecutors from the Eastern District of North Carolina who handle pandemic fraud prosecutions at the federal courthouse on New Bern Avenue. These prosecutors have charged business owners throughout the Triangle area – including Durham, Chapel Hill, Cary, and surrounding Wake County communities – with bank fraud, wire fraud, and false statements for allegedly inflating payroll figures, misrepresenting employee counts, using proceeds for unauthorized purposes, or submitting multiple applications through entities prosecutors claim were created solely to multiply loan amounts. What makes Raleigh cases particularly challenging is that Eastern District prosecutors are known for thorough investigations and aggressive charging decisions, treating pandemic fraud cases with the same intensity they apply to major drug trafficking and organized crime prosecutions despite many defendants being small business owners with no criminal history who made errors during economic crisis.

Federal PPP Fraud Enforcement in Raleigh

The Eastern District of North Carolina, headquartered in Raleigh, has been active in prosecuting PPP and EIDL fraud cases throughout the Research Triangle region. Federal prosecutors have brought cases involving restaurant owners, construction contractors, healthcare businesses, technology companies, and retail operations. One case that drew attention involved a Raleigh business owner charged with obtaining $600,000 across multiple entities – prosecutors argued the companies were shells with overlapping operations and employees, while defense claimed they were legitimately separate businesses entitled to individual loans under program rules. After conviction at trial, the court imposed a 6-year sentence followed by supervised release and full restitution.

EIDL fraud prosecutions in Raleigh often involve cases where prosecutors claim defendants used stolen identities or fabricated business information to obtain advances. These cases frequently result in aggravated identity theft charges under 18 U.S.C. § 1028A, carrying mandatory consecutive 2-year sentences that must run after any sentence imposed on underlying fraud charges. Even defendants who played relatively minor roles in submitting applications face significant prison time when identity theft enhancements are added to fraud convictions.

Bank Fraud and Wire Fraud Charges

Bank fraud under 18 U.S.C. § 1344 carries up to 30 years in federal prison and applies whenever you allegedly made false statements to obtain PPP or EIDL funds. Raleigh prosecutors use this statute aggressively, arguing that any material misstatement on loan applications constitutes bank fraud regardless of whether you intended to use proceeds legitimately or planned to repay loans. The statute doesn’t require proof you intended to permanently deprive financial institutions of funds – only that you knowingly made material misrepresentations to obtain money.

Wire fraud charges under 18 U.S.C. § 1343 get stacked on top when you used electronic communications: submitting online applications, emailing documents to lenders, receiving wire transfers of loan proceeds. Each electronic communication can be charged as a separate count. We’ve seen Eastern District prosecutors charge 10-15 wire fraud counts for single loan applications, each carrying 20 years maximum, creating theoretical exposure of 200-300 years designed to pressure defendants into guilty pleas rather than trials.

False Statements and Money Laundering

False statements charges under 18 U.S.C. § 1001 criminalize lying to federal agencies and carry 5 years maximum. Prosecutors use this when you allegedly provided false information to SBA even if banks approved loans without detecting problems. Money laundering charges under 18 U.S.C. § 1956 get added when prosecutors claim your spending patterns demonstrate you knew funds were obtained fraudulently – purchasing vehicles, jewelry, or making transfers prosecutors frame as evidence of criminal intent rather than legitimate business expenditures.

Defenses to PPP and EIDL Fraud Charges

The most effective defenses challenge prosecutors’ proof of intent. Federal fraud statutes require proof that you knowingly made false statements – not that you made good-faith errors or relied on bad advice from accountants. We build intent defenses by presenting evidence that you consulted professionals before applying, that you relied on their calculations and recommendations, that you made reasonable interpretations of SBA guidance that was genuinely ambiguous during rapid program rollout in early 2020.

We present testimony from accountants and business advisors you consulted, showing they reviewed your materials and advised your applications were accurate. We present character witnesses who testify about your reputation for honesty and legitimate business operations spanning years. We show you disclosed information to lenders voluntarily rather than concealing it, demonstrating lack of fraudulent intent.

Materiality Challenges

Even when statements were false, prosecutors must prove they were material – meaning they influenced lending decisions. If you overstated payroll by $25,000 but would have qualified for the same loan with accurate figures, that undermines the fraud charge. If banks approved your loan despite red flags that should have triggered denial, that suggests your statements weren’t material to approval decisions. We hire forensic accountants who analyze applications and testify about whether alleged misstatements actually affected loan amounts or eligibility determinations.

Negotiating with Eastern District Prosecutors

Assistant U.S. Attorneys in Raleigh handle substantial PPP fraud caseloads, creating pressure to resolve cases efficiently through plea agreements. We negotiate from positions of strength when possible, identifying weaknesses in government evidence, highlighting proof problems with intent or materiality, and demonstrating that trials will be expensive and uncertain for prosecutors.

We push for reduced charges – pleading to false statements under § 1001 instead of bank fraud reduces maximum exposure from 30 years to 5 years, dramatically affecting guideline calculations and sentencing outcomes. We also negotiate over loss amounts, which determine guideline ranges. Government claims $300,000 loss, we present evidence showing $120,000 was spent on payroll, rent, and utilities – reducing actual loss to $180,000 and lowering offense levels by 2-4 points, translating to years less incarceration.

Federal Sentencing in Raleigh

Federal judges in the Eastern District of North Carolina are known for carefully considering individual circumstances but also taking fraud cases seriously, particularly when they involve exploitation of pandemic relief programs. Successful sentencing requires presenting compelling mitigation beyond just asking for leniency: demonstrating lack of criminal history, strong family and community ties throughout the Triangle area, acceptance of responsibility, rehabilitation efforts, charitable work, and the extraordinary economic pressures of the pandemic that created desperation during 2020.

We present letters from community members, employers, family, and religious leaders who vouch for your character. We hire experts who testify about economic conditions in your industry during 2020, showing that business owners throughout Raleigh and Durham faced unprecedented uncertainty and made decisions under extreme pressure without criminal intent. We argue for alternatives to incarceration – probation, home confinement, community service – emphasizing that restitution and supervised release accomplish sentencing goals without destroying families and businesses.

Pre-Indictment Strategies

If you become aware of an investigation early – because investigators contacted your bank, interviewed employees, or agents approached you for voluntary interviews – that’s the critical moment to hire counsel. We’ve successfully negotiated declinations by presenting prosecutors with evidence showing: you made good-faith errors, you relied on professional advice, ambiguous SBA guidance made it reasonable to interpret eligibility differently, you’ve already repaid questionable amounts, your business was and remains legitimate with operations throughout the Triangle.

Federal prosecutors in Raleigh have discretion whether to charge cases. When we intervene early with compelling evidence contradicting criminal intent or demonstrating lack of materiality, we sometimes persuade prosecutors that federal prosecution isn’t warranted. Even when we can’t prevent charges entirely, early intervention often results in more favorable charging decisions – fewer counts, lower loss amounts, reduced charges that carry less exposure.

Cooperation Agreements

When evidence is overwhelming, cooperation becomes an option – but requires careful evaluation. Cooperation means providing information about others involved in fraud, testifying against co-defendants, and working with prosecutors to build cases. The benefit is substantial assistance departures that can reduce sentences by 50% or more, sometimes resulting in probation even when guidelines call for significant prison time.

But cooperation has serious risks. You must disclose all criminal conduct – not just charged offenses but everything. If prosecutors discover you lied or withheld information, they’ll void your agreement and use your proffer statements against you. You may need to testify at trial, facing aggressive cross-examination. You face potential retaliation from co-defendants. For many defendants, cooperation isn’t realistic, and alternative strategies become the path to favorable outcomes.

What Spodek Law Group Does for Raleigh Defendants

We defend PPP and EIDL fraud cases in Raleigh federal court and throughout North Carolina. We intervene during investigations before charges are filed, presenting evidence to prosecutors that sometimes leads to declinations. After indictment, we file motions challenging the legal sufficiency of charges, arguing that alleged conduct doesn’t meet fraud elements. We move to suppress evidence obtained through improper searches or overly broad subpoenas.

We conduct independent investigations, interviewing witnesses prosecutors ignored and hiring forensic accountants who testify about why alleged misstatements weren’t material or why your conduct was consistent with legitimate business practices. At trial, we cross-examine cooperating witnesses about their criminal histories and motivations to fabricate. We present defenses focused on intent, materiality, and good-faith reliance on ambiguous guidance during unprecedented crisis.

At sentencing, we present mitigation packages showing your ties to the Raleigh community, lack of criminal history, acceptance of responsibility, rehabilitation efforts, and pandemic circumstances that created economic desperation. We’ve secured probationary sentences for defendants facing guideline ranges calling for years in prison by humanizing them to judges.

At Spodek Law Group, Todd Spodek has defended high-profile cases others thought unwinnable – including the client whose story became a Netflix series. When you’re facing years in federal prison for PPP or EIDL fraud charges in Raleigh, aggressive defense determines the outcome. We’re available 24/7 at our offices throughout NYC and Long Island. Reach out now – early intervention makes enormous difference in federal fraud prosecutions.