Orlando Federal White Collar Crime Lawyer

PPP loan fraud prosecutions have been skyrocketing over the past year across the country, including in Orlando. If you are under investigation or have been indicted for alleged PPP loan fraud, contact the white collar crime lawyers at Evergreen Attorneys today for a confidential consultation. The team at Evergreen Attorneys are experienced in PPP loan fraud cases and know the ins and outs of the Middle District of Florida.

You need hope and a plan to guide your federal white collar defense. Call us today at (303) 948-1489 if you are facing federal charges in Orlando, Florida.

Understanding PPP and EIDL Loans

In 2020, Congress passed the Coronavirus Aid, Relief, Economic Security (CARES) Act which provided emergency financial assistance to millions of American small businesses suffering economic harm created by the COVID-19 pandemic. The CARES Act created programs such as the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) program.

PPP loan applications were submitted by businesses and processed by participating lenders (banks). These banks funded PPP loans using their own funds which were guaranteed by the Small Business Administration (SBA). The SBA directly paid EIDLs and grants to eligible small businesses experiencing substantial financial disruptions from COVID-19.

In order to obtain a PPP loan, the business’s authorized representative signed and submitted a PPP loan application to a private lender participating in the program. The PPP loan application required the business to provide information about average monthly payroll expenses and the number of employees. Payroll expenses were used to calculate the amount of money the small business was eligible to receive under the PPP.

For PPP loan requests above a certain amount, businesses were required to submit documentation verifying their payroll expenses and bank account information, including bank statements and tax returns.

Under the EIDL program, a small business could receive a loan from the SBA for an amount equal to up to six months of working capital. The CARES Act also authorized the SBA to issue advances of up to $10,000 to small businesses. EIDL funds were permitted to be used to fund payroll expenses, sick leave, production costs, and other business obligations. To obtain an EIDL, applicants were required to provide information about the business’s gross revenue, cost of goods sold, and number of employees. These figures were used to calculate the amount of the EIDL and EIDG funds.

What Constitutes PPP Loan Fraud?

There are a number of ways a business could commit fraud in applying for funding under the PPP or EIDL program. The federal government has recently been investigating companies and individuals who obtained PPP or EIDL funding under fraudulent pretenses such as misrepresenting the business’s income, expenses, or number of employees.

In other circumstances, the government has charged PPP or EIDL loan fraud by alleging individuals have created fictitious companies to obtain CARES Act funding.

However, what constitutes “fraud” can sometimes blur the line. For example, PPP loans and EIDL funding were intended to be spent on maintaining employees and funding the business. But in some cases, it may not be clear whether the funds were used to pay for legitimate business expenses or for personal gain. See below for some examples of PPP loan fraud in Orlando and the Middle District of Florida.

• Orlando Couple Agrees to Pay More Than $88,000 Related to Improperly Received PPP Loan Funds
• Over 100 Defendants Federally Charged With Fraud Related To The COVID-19 Pandemic
• Central Florida resident sentenced to prison for PPP fraud

There is no specific federal statute specific to PPP or EIDL loans. However, the government typically charges individuals suspected of PPP loan fraud with a multitude of federal felonies. These charges often include:

Wire Fraud – 18 U.S.C. § 1343

Wire fraud occurs when an individual devises or intends to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, and transmits or causes to be transmitted by means of wire, radio, or television communications in interstate commerce.

More often than not, the “wire” in wire fraud is the Internet, which will always “cross” interstate commerce giving the federal government jurisdiction over these charges. Wire fraud is punishable by up to 20 years in federal prison.

Bank Fraud – 18 U.S.C. § 1344

Since PPP loans were funded by banks and guaranteed by the SBA, the federal government can also bring charges of bank fraud where there is PPP loan fraud. Bank fraud is defined as knowingly executing, or attempting to execute, a scheme to defraud a financial institution; or to obtain money under the control of a financial institution, by means of false or fraudulent pretenses, representations, or promises.

Bank fraud is punishable by up to 30 years in federal prison and/or a fine up to $1,000,000.

Money Laundering – 18 U.S.C. § 1957

When it comes to PPP loans, fraud and money laundering are usually charged one after the other. Money laundering under § 1957 occurs when someone knowingly engages or attempts to engage in a monetary transaction over $10,000 that is derived from “specified unlawful activity.”

The government’s theory in these cases is typically that using money received from a PPP loan for personal gain is a monetary transaction from unlawful criminal activity. There are two important distinctions between this statute and the “traditional” money laundering statute under 18 U.S.C. § 1956. First, the government does not have to prove that the defendant knew that the offense from which the property was derived was specified unlawful activity. Second, the government does not have to prove that there was an intent to conceal the money. This means that prosecution under § 1957 is generally easier for the prosecution to prove than under § 1956.

Under this statute, a conviction can lead to up to 10 years of imprisonment for each count of money laundering.

Attempt and Conspiracy – 18 U.S.C. § 1349

Any attempt or conspiracy to commit any of the above offenses can be charged under this statute and the same penalties for the substantive offense are applicable regardless of if the attempt or conspiracy was ultimately successful.

General Conspiracy – 18 U.S.C. § 371

Conspiracy under section 371 is a sort of catch-all for many federal crimes. The statute states:

If two or more persons conspire either to commit any offense against the United States, or to defraud the United States, or any agency thereof in any manner or for any purpose, and one or more of such persons do any act to effect the object of the conspiracy, each shall be fined under this title or imprisoned not more than five years, or both.

Notably, the government can obtain convictions on both conspiracy and the substantive offense if all of the elements are met for each count (but the same is not true for attempt).

What To Do if Suspected of PPP Fraud?

PPP loan or EIDL fraud typically begins with an investigation by federal authorities. This could be the OIG, SBA, IRS, or other federal law enforcement agencies. If you are under investigation, or believe you may be the subject of investigation, it is important to have attorney representation ASAP. Early intervention can be key in some cases.

Some cases begin with a Civil Investigative Demand (CID) to compel individuals or businesses to produce documents, written answers, or testimony. Click here for more information on CIDs and what you need to do if you receive one.

Another sign that a person is under investigation for PPP loan fraud is a federal target letter. Target letters inform the individual about the government’s investigation and allows them to respond before federal criminal charges are filed.

No matter the case, it is absolutely essential to have experienced federal white collar crime lawyers knowledgeable in this area of the law protect your rights and fight for your freedom. As discussed below, the charges that are usually brought by the federal government in PPP fraud cases carry substantial prison terms and large fines and restitution. Having experienced attorneys who know the federal system and are familiar with the Middle District of Florida is incredibly important to ensuring your rights are preserved and you receive the defense you deserve.

What if I’ve been charged with PPP Loan Fraud?

Receiving a CID or target letter can be terrifying. Our white collar crime lawyers at Evergreen Attorneys regularly defend people accused of PPP loan fraud across the country. If you believe you are under investigation, or have been charged with PPP loan fraud, call the experienced federal white collar crime lawyers at Evergreen Attorneys today for a free consultation. We can be reached at (303) 948-1489 or by email at [email protected].

Contact Orlando Federal Criminal Defense Attorneys Today

Orlando PPP loan fraud charges can carry serious prison terms and hefty fines and restitution. The Orlando federal white collar crime lawyers at Evergreen Attorneys are here to help and provide you hope. Evergreen Attorneys are proud to defend against federal criminal investigations and charges in Orlando and are ready to provide a free initial consultation about your case today.

If you or a loved one are seeking assistance with a federal case, contact the Orlando federal white collar crime lawyers at Evergreen Attorneys today at (303) 948-1489 or [email protected].