The Coronavirus Aid, Relief, and Economic Security Act, also known as the CARES Act, was passed by the 116th U.S. Congress and signed in response to the financial fallout of the COVID-19 pandemic in the United States.

The CARES Act established the Paycheck Protection Program (PPP), which permitted the Small Business Association (SBA) to provide loans to qualified businesses impacted by the coronavirus pandemic. PPP offered financial relief to millions of small businesses and workers. Its loan forgiveness feature made it particularly attractive, offering a lifeline to businesses struggling to stay afloat and retain employees during unprecedented economic disruption.

Four years later, seemingly removed from the (rightfully) panicked financial state of 2020-2021, the SBA and other regulatory bodies are conducting random and targeted audits and reviews to ensure compliance with PPP regulations. These audits can uncover discrepancies that lead to further investigation and significant criminal charges, including fines, restitution, and imprisonment, depending on the severity of the fraud.

Civil penalties can also be imposed, such as treble damages under the False Claims Act, which means repaying three times the amount of the fraudulent claims. Additionally, individuals and businesses involved in PPP fraud may be barred from participating in future federal programs and contracts, damaging their reputation and operational capabilities.

Since 1977, Trombley & Hanes, P.A., and its trusted criminal defense lawyers in Tampa have provided full-service state and federal legal defense strategies for individuals and businesses in Florida and throughout the U.S.—and more recently those individuals and businesses being investigated or charged with PPP fraud.

Being investigated for PPP fraud is a serious matter that requires prompt and careful attention to resolve. Understanding the reasons behind the investigation and taking appropriate steps to address them is essential in navigating the process effectively. We can help. Contact our skilled PPP fraud defense attorneys in Tampa today to discuss your case.

Investigated for PPP Fraud in Tampa, FL

What are the Most Common Reasons Individuals and Companies are Investigated for PPP Fraud?

Being investigated for PPP fraud can occur for several reasons, typically around allegations of misrepresentation or misuse of the funds provided.

Some common reasons why an individual or business might be under investigation include, but are not limited to:

  • False Information on the Application: Providing inaccurate or false information regarding the size of the business, payroll expenses, or employee numbers to qualify for larger loans than entitled.
  • Misuse of Funds: Using PPP funds for non-eligible expenses, such as personal expenses, non-business-related purchases, or investments, instead of the intended purposes like payroll, rent, utilities, and mortgage interest.
  • Falsified Documentation: Submitting falsified or misleading documentation to support the application or loan forgiveness process, such as fake payroll records or altered financial statements.
  • Double Dipping: Applying for and receiving PPP loans from multiple lenders or overlapping federal relief programs is prohibited.
  • Failure to Meet Eligibility Requirements: Misrepresenting the business’s eligibility, such as claiming to be an operational business when it is not, or failing to disclose affiliations with other companies that affect eligibility.
  • Suspicious Activity Reports (SARs): Banks and financial institutions are required to report suspicious activities. If a bank notices irregularities or red flags in how PPP funds are managed or disbursed, they may file a SAR, prompting an investigation.
  • Whistleblower Reports: Employees, competitors, or other parties may report suspected fraud to authorities if they believe PPP funds are being misused or obtained fraudulently.

In August 2022, Congress passed the PPP and Bank Fraud Enforcement Harmonization Act of 2022. The Bill was signed into law, extending the statute of limitations for civil and criminal enforcement actions for fraud on the Paycheck Protection Program to ten years.

This extension gives the government plenty of opportunities to continue enforcement through the rest of the ten-year limitations period. If companies and individuals who applied for and received government-sponsored pandemic relief funding have not conducted due diligence to ensure they were received correctly, used, and potentially forgiven, now is the time to do so.

If you or your company are being investigated for PPP Fraud, contact our law firm immediately to understand your legal rights and options to mount a proper defense.

Our Hillsborough County criminal defense attorneys bring a unique perspective to your case, with decades of combined experience at both state and federal levels. Our team includes a former Assistant United States Attorney, an Assistant Hillsborough State Attorney, and an Assistant Pinellas County State Attorney. This diverse background allows us to view your case from both sides of the courtroom, providing you with a significant legal advantage.

Contact Our Knowledgeable PPP Fraud Defense Attorneys in Tampa, Florida, for Help Today

When facing PPP Fraud charges and the potential consequences of a conviction, you need a skilled Tampa criminal defense lawyer from the beginning. Do not let state or federal law enforcement intimidate you into providing a statement before you have an attorney to protect your best interests. You have the right to remain silent and to speak with an attorney. Invoke both and contact our trusted criminal defense lawyers in Florida, who have been producing actual results for real people for more than 110 combined years.

Contact us at 813-229-7918 or online to schedule a consultation to learn more.