Ordinarily, federal prosecutors will not prosecute white-collar crimes unless a certain loss amount in dollars (usually at least $1,000,000) occurs. While this general rule of thumb applies to Arizona federal courts, other jurisdictions may have higher or lower amounts.
What is PPP Loan Fraud?
In response to the economic impact of the COVID 19 pandemic, the federal government was quick to hand out PPP loans to assist businesses in paying their rent, employees, and other routine business costs that they might not otherwise be able to pay due to COVID related lockdowns and other related factors. Few, if any, checks and balances were put into place to monitor the application process.
This opened the flood gates for many people to take advantage of the system by committing PPP loan fraud. In some instances, people who did not even have businesses applied for and got loans. This includes inmates in various prisons who scammed the government out of millions of dollars. Others who received a windfall from a PPP loan, decided to buy luxury cars and other extravagant purchases, as opposed to spending the money on the loan’s intended purposes.
Penalties for PPP Loan Fraud
Now, almost two years after the government handed out PPP loans, it is going back and investigating cases of fraudulent applications and fraudulent expenditures by loan recipients. And even though many of these loans are less than the million-dollar cases typically handled by federal prosecutors, they are aggressively being prosecuted – oftentimes by special prosecutors assigned from Washington D.C. – given the high profile nature of the fraud and, frankly, in the government’s efforts to wipe some of the egg from its face after handing out so much money with little or no substantiation for it.
All PPP loan borrowers had to make truthful attestations under penalty of perjury both when they obtained the loan and when they applied for forgiveness. A false statement in the application process or the forgiveness paperwork could result in charges such as wire fraud (because the forms were electronically transmitted), conspiracy, or even theft of government funds. Federal judges have thus far treated those found guilty of PPP loan fraud with an extra degree of harshness for taking advantage of a system that was put in place to help struggling businesses, rather than filling the garages of their owners with vanity and luxury boats and cars.
Hire an Experienced White Collar Crime Attorney
If you are being investigated for, or have been charged with any white-collar crime related to your obtaining a PPP loan, you need to hire an experienced and aggressive attorney who has experience in successfully dealing with sophisticated white collars. Just recently, Jason Lamm successfully defended a Phoenix man who was charged with counterfeiting stimulus checks. Yes, this actually happened.
Confidential consultations can be scheduled by contacting Jason Lamm’s office at (602) 663-9100. If you have been contacted by a federal agent wanting to discuss your PPP loan, contact Jason Lamm first before making any statements that could be incriminating and which could allow the government to make an example out of you.