If you have been implicated, investigated or charged with a crime already, the consequences can be serious – not least of which is a felony on your record for the rest of your life as well as the possibility of a lengthy federal prison sentence.
However, with strong and experienced legal representation, we can work on a defense that delivers that best possible outcome in or out of court.
At The Maine Criminal Defense Group, our defense lawyers will work to get the charges dismissed, reduced or turned over to a civil matter or, if you are convicted, argue to mitigate the possible consequences.
Call 207-571-8146 or contact us online to schedule a consult with one of our highly skilled criminal defense attorneys today.
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What is PPP Fraud?
PPP fraud charges are federal charges laid against business owners who have allegedly abused the Paycheck Protection Program (PPP).
This program was set up by the federal government in 2020 as a provision of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). It provided a $350 billion fund for small businesses loans to help cover expenses and help struggling businesses stay afloat.
The fund was intended to provide small businesses with the funds to pay up to eight weeks of payroll costs (including benefits) and to help with paying interest on mortgages, rent, and utilities.
As with most such programs, the eligibility requirements and spending guidelines were strict. However, the PPP program ran out of money just two weeks after its introduction, and the federal government is now facing strong calls to account for the administration of the program.
Hence, there has been a recent crackdown on the abuse of funds from the PPP by business owners.
Call 207-571-8146 or contact us online to schedule a consult with one of our highly skilled criminal defense attorneys today.
What are the typical PPP fraud charges?
As pressures on small businesses increased during the pandemic, some small business owners took actions that were in breach of the PPP regulations and led to alleged fraudulent activity.
The following types of breaches are typically resulting in PPP fraud charges for business owners in Maine and around the country:
- Spending PPP funds on unapproved aspects of the business: Only employee pay, mortgage, rent, and utilities are covered as approved targets for PPP money. Spending on anything else is a contravention of the loan terms.
- Obtaining PPP loans from multiple lenders: Businesses are only authorized to loan PPP funds from a single lender – receiving funds from more than one lender is illegal.
- Overstating employee numbers: The amount of money a business is entitled to receive depends on payroll amounts. Falsely inflating employee numbers increases the potential loan amount, but is unlawful.
- Understating employee numbers: Funds were generally only available to small businesses with under 500 employees, so if you understated employee numbers to gain eligibility, you may be prosecuted.
- Making false statements on your application: If false or inaccurate information was provided during the application process, you could face PPP fraud charges. This can result in fines and up to two, five, or thirty years in prison (depending on whom the false statements were made to).
- Identity theft: Using another person’s identity for a PPP application is a criminal offense punishable by up to two years in prison.
Depending on the circumstances, the types of fraudulent activity outlined above can lead to one or more of the following charges:
- Major fraud against the United States: Up to a $5 million fine and up to 10 years in prison.
- Wire fraud: Fines and up to 20 years in prison.
- Bank fraud: Fines of up to $1 million and up to 30 years in prison.
- Conspiracy: If multiple people are involved in the alleged fraud.
As you can see, the types of PPP fraud charges are many and varied. While some alleged offenses are seemingly clear-cut, legitimate mistakes were made by business owners who ended up facing serious criminal charges.
Remember, fraud charges require proof of intent or “reckless disregard” (“knew or should have known”) for federal prosecutors to secure a conviction.
With the guidance and support of an experienced PPP fraud lawyer, you have a better chance of successfully defending the charges against you and avoiding the harsh penalties and a felony conviction that could follow you around for the rest of your life.
Call 207-571-8146 or contact us online to schedule a consult with one of our highly skilled criminal defense attorneys today.
What should you do if you are facing federal charges for PPP loan fraud?
If you are flagged by federal agencies for PPP fraud, you can expect a serious investigation conducted with some urgency.
The federal government is under considerable pressure to account for the funds spent with small businesses during the pandemic, and the Department of Justice is looking for answers. Since May 2021, prosecutions for PPP fraud have continued aggressively across all states, and Maine is no exception.
The best way you can respond to charges of PPP fraud is with strong legal representation to rebut the charges. The first you may know about the investigation is after you are contacted by one of the federal agencies involved.
From this point, you should proceed very carefully. Making false statements to investigators can be serious, and you need to avoid saying anything that could implicate you in a crime.
It is advisable to contact a lawyer who has some experience in PPP fraud cases, which is easier said than done because of the recency of such cases within the criminal justice system.
How a PPP fraud attorney can help
If you contact us at The Maine Criminal Defense Group before discussing your PPP loan application with federal investigators, we can assess your potential criminal exposure and advise you on responding to any potential inquiry.
Do not simply ignore the problem and expect it to go away, as that is unlikely to happen.
We will manage communications with investigators and help prevent assets from being frozen or seized, as well as other potential negative consequences of an investigation.
Once you retain us, we immediately contact the investigator or government agent involved to ensure that they do not contact you further. All communications are channeled through us, which may also apply to financial institutions that may be holding funds belonging to you.
Depending on the circumstances and the nature of the investigation, we may also:
- Obtain loan applications and supporting documents from you to review for any errors
- Preserve relevant business documents that may support your need for the loan or confirm the use of the funds received.
- Interview the CPA, accountant, financial advisor or staff members involved in the application (if applicable).
- Consult with a forensic accountant regarding the company’s financials and the loan application.
- Identify any mitigating circumstances or reasons for mistakes and present these to government agents, investigators, or the prosecutor to attempt to resolve the matter.
If you already had assets seized or frozen, we can help you take the steps required to respond to and contest the action against you, while potentially avoiding criminal charges.
Responding through your lawyer may be able to convince prosecutors that criminal charges are not in the best interests of the government and that a civil case (with repayment of funds) is more appropriate.
You can play your part by making digital copies of your business and personal financial records to document your loan request and support your defense. Do not be tempted to destroy any evidence, as this will make criminal charges more likely, and we may need these documents to defend your case.
If you have not yet received notice from a federal agency but are concerned about compliance with the regulations for receiving money from the PPP fund, do not wait for the call. You should inform employees that if they have any concerns about your PPP application to come to you directly without fear of retaliation. Dealing with a federal whistleblower case is the last thing you need at this point.
Contact a Federal PPP Fraud Defense Lawyer in Maine
You should also seek legal advice if you suspect that you have inadvertently contravened any of the stipulations for receiving loans under the PPP scheme.
If you are facing charges related to PPP fraud, contact our firm directly online or call us at (207) 571-8146 to speak with an experienced Maine defense -lawyer who can help you.
Call 207-571-8146 or contact us online to schedule a consult with one of our highly skilled criminal defense attorneys today.
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