Consequences of PPP Fraud
Learn What is At Stake if You Are Under Investigation for PPP Fraud in Boston
With the U.S. Department of Justice (DOJ) and other federal authorities targeting Paycheck Protection Program (PPP) recipients, individuals and businesses that received loans under the program should be taking steps to prepare for the possibility of an audit or investigation. Allegations of PPP fraud can lead to both civil enforcement action and criminal prosecution, with criminal charges carrying both fines and prison time -- our Boston DOJ criminal tax attorney can help.
Potential Charges and Penalties in PPP Fraud Cases
Preparing for the possibility of a PPP fraud audit or investigation involves understanding your level of risk. It also involves understanding the consequences that are at stake. With this in mind, our IRS criminal PPP lawyer provides an overview of some of the potential criminal charges for PPP fraud and the associated penalties:
Aggravated Identity Theft
Using a third party’s information without their authorization to secure a PPP loan (i.e., falsifying payroll records or fraudulently submitting an application on behalf of someone else’s business) can lead to federal charges for aggravated identity theft. These charges, prosecuted under 18 U.S.C. Section 1028A, carry statutory fines and up to two years of federal imprisonment.
Since the PPP involved private lenders, individuals and businesses charged with PPP fraud can face prosecution under the federal bank fraud statute. Under 18 U.S.C. Section 1344, bank fraud carries up to a $1 million fine and 30 years of federal imprisonment.
Mail Fraud and Wire Fraud
Committing fraud through use of the mail or any form of Internet communication can lead to prosecution under the federal mail fraud and wire fraud statutes (18 U.S.C. Sections 1341 and 1343). While mail fraud and wire fraud charges carry up to a $250,000 fine ($500,000 for businesses) and 20 years of federal imprisonment in most cases, our IRS criminal tax lawyer knows that in cases involving presidentially declared emergencies and financial institutions, the maximum penalties increase to a $1 million fine and 30 years in federal prison.
Improperly claiming deductions for PPP expenses and other tax-related violations can lead to prosecution for criminal tax fraud. In criminal cases prosecuted under 26 U.S.C. Section 7201, the potential penalties include up to a $100,000 fine ($500,000 for businesses) and up to five years of federal prison time.
Theft of Government Property
Paycheck Protection Program fraud allegations can also lead to charges for theft of government property under 18 U.S.C. Section 641. This is another serious federal crime, and a conviction can lead to up to a $100,000 fine ($500,000 for businesses) and 10 years of federal imprisonment.
Request a Confidential Consultation With a Boston DOJ Criminal Tax Attorney at Thorn Law Group
While these are some of the most common charges in federal PPP fraud cases, they are not the only charges the DOJ can pursue. If you are under investigation for PPP fraud—or if you have concerns about facing a PPP fraud investigation—you should discuss your situation with an experienced lawyer as soon as possible. To request a confidential consultation with Boston DOJ criminal tax attorney Kevin E. Thorn, Managing Partner at Thorn Law Group, call 617-692-2989.