The best criminal lawyers in Chicago are increasingly being called up to represent individuals and companies in federal prosecutions arising out of alleged “PPP fraud.” The following are some things of note that the best criminal lawyers in Chicago are becoming increasingly aware of in connection with those types of federal prosecutions.
As would be expected, the government has clearly shown an intent to pursue PPP fraud. But what is it? Of course, these cases arise out of the much talked about initiative that resulted from the Covid-19 crisis. Tens of millions of employers (and employees) suddenly found themselves facing the prospect of no income, or substantially diminished income, for months.
The federal government moved quickly to provide economic (and some would say, more importantly mental) relief by way of “PPP” loans as part of the “Paycheck Protection Program” passed as part of the CARES Act.
However, as would be expected from any program that announced an intent to dole out billions of dollars, a certain percentage of the submitted applications were based upon fraud in the first instance.
Or, alternatively, even if an application submitted was not itself fraudulent, the subsequent use of the PPP loans was fraudulent because it was used for unauthorized purposes, including in some instances lavish or even relatively modest personal spending.
This is a problem for the best criminal lawyers in Chicago when representing clients because borrowers were required, in connection with their applications, to make good-faith certifications that, among other things, the PPP loans would be used for such things as retaining workers, maintaining payroll, and making payments for such things as leases, utilities, and mortgages.
Thus, these top lawyers find themselves attempting to defeat federal PPP fraud claims that are charged under various legal theories, including mail fraud, wire fraud, bank fraud, conspiracy, making false statements, and conducting illegal monetary transactions.
These lawyers are sometimes defending these cases by attempting to establish that the employer was a legitimate business that did not intentionally make any false statements in connection with the PPP loan application process itself.
These top attorneys are also sometimes able to successfully argue that mere inadvertence, oversight, or negligence does not equate to fraudulent intent.
The best criminal lawyers in Chicago are also sometimes successfully able to establish that the applicant in good faith relied upon the advice of counsel, accountants, or other professionals in preparing and submitting the PPP loan applications.
In addition, they will sometimes be able to successfully establish that what, at first glance, appear to be personal expenses were actually expenses that were reasonably and necessarily incurred in furtherance of the applicant’s legitimate short-term or long-term business interests. Of course, such a defense falls flat if the monies are tied only to world travel and three sports cars in the employer’s home garage.
In addition, they also must be prepared to defend against prosecutions that arise out of the alleged “cover-up” of fraudulent PPP loan activity, including charges premised upon false statements or obstruction.
In sum, PPP fraud cases present attorneys with the opportunity to utilize many of the pre-existing tools in their defense arsenal, while also creatively constructing defenses based upon the recent and somewhat novel PPP program, before a large body of case law is developed by the federal courts.
Written by Michael Leonard -Leonard Trial Lawyers