YOU MAY HAVE SEEN TODD SPODEK ON THE NETFLIX SHOW INVENTING ANNA
When you’re facing a federal issue, you need an attorney whose going to be available 24/7 to help you get the results and outcome you need. The value of working with the Spodek Law Group is that we treat each and every client like a member of our family.
PPP LOAN FRAUD PENALTIES
Are You Being Accused of PPP Loan Fraud?
Are you being accused of PPP loan fraud? There is a lot of scrutiny going on – with recipients of the Paycheck Protection Program. There are so many fraudulent PPP loans that were issued, and now being investigated by the Department of Justice. At the same time, the IRS, the FBI, and the SBA, are all looking at borrowers who received $2 million or more in PPP funds and investigating them for fraud. Some borrowers who received smaller loans, as part of an ongoing effort to investigate potential abuses – are also being looked at. If you’re a small business owner who applied for the Paycheck Protection Program – you could be at risk for an SBA audit, or a federal investigation.
The PPP loan fraud penalties can be severe. You shouldn’t hesitate to seek legal guidance from the Spodek Law Group. We encourage you to contact our PPP loan fraud attorneys today, for a risk free consultation.
About the Paycheck Protection Program
The Paycheck Protection Program is a $670 billion federal loan program which was established by the SBA in March 2020, under the CARES act. In the middle of the pandemic, the PPP program was intended to provide business owners the economic aid they needed to keep employees on their payroll. PPP provided funds in order to pay employee salaries, and support ongoing business operational costs. The key component of the Paycheck Protection Program was the provision that the loans can be forgiven provided that recipients retained their workforce, maintained employee salary levels, and used the funds to cover the payroll costs and other eligible expenses. The loan amount was based on the # of employees, average payroll costs. 60% of the loan had to be used for payroll, while the other 40% could be used for interest on office mortgage, rent, utilities, etc.
PPP Loan Recipients Could Be At Risk
The PPP program was very susceptible to fraud schemes, more than anyone could have predicted. As a result of this, the federal government has increased their oversight of the program, and are working very hard to ensure compliance of the loan program .The rules and regulations governing the Paycheck Protection Program is constantly changing, and business owners are unsure of whether they were eligible for it – and qualify for loan forgiveness. The Department of Justice is very carefully investigating allegations of PPP loan fraud, and the SBA is auditing PPP loan recipients. There is immense risk for criminal prosecution re: PPP fraud.
If you are looking for a lawyer that listens, is aggressive where needed, and holds his word above all else, Todd is the best pick. I had hired multiple attorneys prior to hiring the Spodek Group for a white collar case. The first thing that stood out to me was the cost, as anyone going through the process and dealing with the system, money was tight at that time - especially after hiring and firing multiple lawyers. The cost was not as high as others which was definitely a plus. Todd's intake process was also unlike other attorneys. He took the time to actually listen. He cared. He was trying to put himself in my shoes while I was explaining the situation to him and he really took the time to understand the whole situation. Other lawyers will give you 15 mins and send you a retainer agreement. Not Todd, I think he spent almost two hours with me as I was explaining everything.Not only was he great during the onboarding process, he was supportive and very informative through the entire plea process and eventually sentencing. After hiring him, I asked if I should hire a prison consultant, he told me to save my money as he would do everything they would. He was right and held up to his word. Later on I would hear from others that went with the prison consultants that they were a waste of money - I am glad I listened to Todd!When it came time for sentencing, two days prior to sentencing, the prosecutor tried increasing my proposed prison time by almost double - apparently a normal move. Todd and his team worked with me non-stop through the weekend prior to sentencing to ensure that I was not given additional prison time. Again, he took the time to listen and came up with a strategy to explain the case with great detail.Unfortunately, I did plead guilty as that was my best option. Todd and his whole team wrote up nearly 300 pages of a summary of what happened and why I should not be given prison time. If I breakdown the amount I spent with Todd versus the amount of work that I saw being done, I am shocked I was not charged four times as much. The other benefit was, a lot of criminal defense lawyers were just a single attorney with a paralegal or two. Todd had a team of people that I dealt with (5-7 people that I interacted with), but he was ALWAYS accessible. It would never take him more than an hour to reply unless he was in court.I was sentenced to prison and I was emotionally distraught. Todd and his team did whatever they could even after sentencing to make sure I was alright. He personally stayed in touch with my family to ensure I was doing alright and offered support to them. Most lawyers would consider the job complete at sentencing, not Todd.After prison, Todd still spent time with me to make sure I was on the right track and avoiding any potential risks in the future. He has also been giving advice on how to navigate probation etc and has not been looking at the clock for billing.Although I wish I had never been arrested in the first place, I am glad I had Todd and his team in my corner. Without them I likely would have had to spend a lot more time in prison than I did.Thank you, Todd, and the entire Spodek Law team, for helping turn what was a nightmare into a manageable situation!
I am immensely grateful to the entire team at Spodek Law Group for their unwavering dedication and exceptional expertise throughout my case. From our initial consultation to the final resolution, their professionalism and tireless advocacy made all the difference. Their strategic approach and attention to detail instilled confidence in me every step of the way.Thanks to their hard work and commitment, we achieved a truly favorable outcome that exceeded my expectations. Not only did they navigate the complexities of my case with precision, but they also provided invaluable support and guidance during what was undoubtedly a challenging time. I cannot recommend Spodek Law Group highly enough, especially attorneys Todd Spodek and Claire Banks; they are beacons of excellence in the legal profession.YSP.
Todd, Ralph and Alex are amazing. Helped my husband get from a double digit number with multiple charges to a single digit, by the time I blink he will be out. They very professional and help with all your needs. They dealt with my anxiety and worry very well and they understand that your family member needs to get home as soon as possible.
Believe every single review here about Alex Z!! From our initial consultation, it was evident that Alex possessed a profound understanding of criminal law and a fierce dedication to his clients rights. Throughout the entirety of my case, Alex exhibited unparalleled professionalism and unwavering commitment. What sets Alex apart is not only his legal expertise but also his genuine compassion for his clients. He took the time to thoroughly explain my case, alleviating any concerns I had along the way. His exact words were “I’m not worried about it”. His unwavering support and guidance were invaluable throughout the entire process. I am immensely grateful for Alex's exceptional legal representation and wholeheartedly recommend his services to anyone in need of a skilled criminal defense attorney. Alex Z is not just a lawyer; he is a beacon of hope for those navigating the complexities of the legal system. If you find yourself in need of a dedicated and competent legal advocate, look no further than Alex Z.
I don’t know where to start, I can write a novel about this firm, but one thing I will say is that having my best interest was their main priority since the beginning of my case which was back in Winter 2019. Miss Claire Banks, one of the best Attorneys in the firm represented me very well and was very professional, respectful, and truthful. Not once did she leave me in the dark, in fact she presented all options and routes that could possibly be considered for my case and she reinsured me that no matter what I decided to do, her and the team will have my back and that’s exactly what happened. Not only will I be liberated from this case, also, I will enjoy my freedom and continue to be a mother to my first born son and will have no restrictions with accomplishing my goals in life. Now that’s what I call victory!! I thank the Lord, My mother, Claire, and the Spodek team for standing by me and fighting with me. Words can’t describe how grateful I am to have the opportunity to work with this team. I’m very satisfied, very pleased with their performance, their hard work, and their diligence.Thank you team!
I recently had Spodek Law Group represent me for a legal matter in NYC and I am thoroughly impressed with their services.Alex Zhik secured the best possible outcome for my case.It was a seamless journey from the initial consultation to the resolution of my legal matter. From the moment I spoke to Todd about my case, his enthusiasm to help was evident, setting a positive tone for the entire experience. The efficiency and professionalism displayed by the team is commendable.A particularly noteworthy aspect of their service is their user-friendly portal to upload your documents/evidence. This not only simplified the process, but showcases their commitment to streamline the client experience.Lastly, in an industry where legal fees can often be a concern, I found their pricing to be very reasonable, making needing legal assistance feel accessible and stress-free.I am grateful for their support and wouldn't hesitate to turn to them again in the future.
What Constitutes PPP Loan Fraud?
The PPP rollout was very rocky. There was high unemployment, and there were ongoing concerns about the pandemic. Small business owners scrambled to get PPP funds before the cash ran out. Lenders struggled to keep up with the influx of loan applications. As of mid-July, the PP program had issued almost 4.9 million forgivable loans for a total of $521 billion in funds. Unfortunately, there was so much confusion – many businesses got PPP funds that weren’t eligible for it. As the federal government undertakes an effort to root out abuses with the PPP program, many applicants and recipients are now concerned about audits and investigations, or being charged with a crime.
Below are examples of things that can trigger criminal prosecution for PPP loan fraud:
Overestimating the number of employees
Misclassifying employees in order to qualify as a small business
Making bad-faith certifications on a PPP loan application
Inflating payroll costs to get a higher PPP loan amount
Getting PPP funds from multiple lenders
Using PPP funds for unauthorized expenses
Firing, or failing to rehire employees or cutting employee salaries despite getting PPP funds
PPP Loan Fraud Penalties
The CARES Act doesn’t specifically contain provisions for criminal enforcement of the Paycheck Protection Program. The Act simple says that PPP loan recipients who fail to retain employees, and fail to use funds for qualified expenses for loan forgiveness, have to repay the loan at an interest rate of 1%. As a result, the DOJ has relied on pre-existing federal statutes when pursuing charges for PPP loan fraud. Below are examples of some of the federal crimes the DOJ might pursue against individuals who are suspected of committing PPP fraud and the associated penalties.
Bank Fraud – max sentence of 30 years in prison, and/or up to $1,000,000 in fines
Wire Fraud – Fine, and/or imprisonment of 20 years. Or 30 years, plus a maximum fine of $1,000,000
Mail Fraud – Fine, and/or maximum prison sentence of 20 years
Tax evasion – Fine of up to $100,000 for an individual, or $500,000 for a business, a term of imprisonment of up to 5 years or both
The most serious penalties are tied to crimes like bank fraud, mail fraud, and wire fraud. Making a false statement to the SBA or a financial institution can lead to a prison term of up to 30 years. Other federal crimes carry varying degrees of penalties. If you are accused of attempting, or conspiring, to defraud the Paycheck Protection Program —- even if you didn’t get PPP Funds, you could still face criminal penalties upon conviction as if the fraud was successful.
Federal investigators have ramped up efforts to combat PPP loan fraud. Since 2021, individuals in many states have been arrested, and criminally charged with fraud crimes and/or the attempt to commit fraud crimes like bank fraud, wire fraud, and for making false statements to a financial institution. The DOJ has issued many press releases following the announcement of charges in each case. Below are examples of what the government is cracking down on:
Applicants who are making false or misleading statements on their PPP loan application
PPP funds used for unauthorized purposes
Loan recipients making false statements on PPP loan forgiveness applications
