What Should I Do if Facing Bank Fraud Charges for PPP Issues?
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What Should I Do if Facing Bank Fraud Charges for PPP Issues?
Dealing with potential bank fraud charges related to the Paycheck Protection Program (PPP) can be an incredibly stressful and confusing situation. As a small business owner who applied for these emergency loans during an unprecedented global pandemic, you likely had the best intentions of keeping your business afloat and employees paid. However, errors or miscalculations in the application process could unintentionally lead to criminal charges.If you find yourself facing accusations of bank fraud, wire fraud, or making false statements in relation to PPP loans, it’s imperative that you don’t go through this alone. The experienced white collar criminal defense attorneys at [Firm Name] are here to guide you through this process and protect your rights every step of the way. Keep reading to learn more about potential PPP bank fraud charges, possible defenses, and proactive steps to take if you find yourself under investigation.
Overview of Potential PPP Bank Fraud Charges
The Paycheck Protection Program was launched in April 2020 as part of the CARES Act to deliver emergency capital to small businesses impacted by COVID-19. In the rush to apply and disburse funds quickly, both applicants and lenders made mistakes leading to allegations of fraud for some PPP recipients. As federal investigators audit more emergency loans, criminal charges could arise relating to:
- Wire fraud – Falsifying information or documentation to obtain PPP loan funds.
- Bank fraud – Making false representations or statements to receive money from an FDIC-insured bank.
- Making false statements – Providing inaccurate or doctored paperwork, tax documents, payroll records, number of employees, or other reporting.
The penalties for federal bank fraud convictions are severe, including hefty fines and years in prison. It’s critical to consult an attorney as soon as you learn you are under investigation to protect yourself.
Common PPP Issues Leading to Alleged Fraud
Honest mistakes or misunderstandings of PPP loan rules could wrongly appear fraudulent to investigators. Some common scenarios include:
- Incorrect calculation of payroll costs – Determining the maximum loan amount can be tricky for seasonal businesses, contractors, sole proprietors, and others with fluctuating income. An inaccurate calculation could seem purposefully inflated.
- Inability to produce required documentation – Failure to provide evidence of qualifying expenses, number of employees, tax documents or other paperwork could raise suspicions even if records were simply lost or disorganized.
- Misuse of funds – While the rules evolved, some early misunderstanding of how funds could be spent might be alleged as improper use by prosecutors.
If charged, the burden would be on you to show these issues were unintentional errors, not deliberate attempts to commit fraud.
Building a Strong Defense Against PPP Bank Fraud Charges
The skilled white collar crime attorneys at [Firm Name] have successfully defended business professionals against complex fraud accusations and related financial charges for decades. If facing prosecution for PPP loan issues, key elements of a strong defense case could include:Demonstrating good faith efforts – While mistakes may have happened in your application paperwork, you likely acted in good faith and relied on the best information you had at the time. We can show the jury you had no ill intent.Highlighting the chaotic, rushed process – The enormous demand for emergency PPP loans required lenders and applicants to move at unprecedented speed. Documentation requirements and rules seemed to change daily in this volatile climate. It would be understandable for errors to occur under such intense pressure.Disputing allegations of personal gain – These loans were intended to cover essential business expenses during state-ordered shutdowns to control the virus’ spread. You likely did not benefit personally and were simply trying to survive.Focusing on corrected errors – As soon as any application issues came to light, you took responsibility and fixed them. This accountability and transparency works in your favor.
Take These Steps If Facing PPP Fraud Charges
If you have reason to believe you are under investigation or could soon face criminal prosecution related to your COVID relief loan application, immediate action is critical for protecting yourself:
- Consult an attorney – Do NOT speak to investigators without qualified legal counsel present to defend your rights. Anything you say can be used against you.
- Gather documentation – Collect any paperwork, emails, texts and evidence relating to your PPP loan application, funds receipt and expenditures. An attorney can help organize this critical information.
- Write a timeline – Document to the best of your recollection the complete timeline of your loan application, approval, expenses, interactions with lenders and more. This can help jog your memory if testifying.
- Avoid retaliatory actions – Under pressure, it’s tempting to want to strike back against perceived injustices. Resist taking retaliatory actions which could further implicate you. Let your attorney do their job.
We have an exceptional track record guiding clients to positive resolutions of federal fraud accusations. Call us today for a free case review, and we’ll discuss defense strategies tailored for your unique PPP loan situation.