Posted:
July 10th, 2020
The federal government rushed to pass the CARES Act to provide emergency relief to the millions of Americans suffering the economic devastation caused by the COVID-19 pandemic.
One aspect of the CARES Act was a fund of $349 billion in forgivable loans made to small businesses for job retention and certain other expenses, through a program call “PPP.” The program was later provided an additional $300 billion to reach more small businesses.
The CARES Act required PPP loan proceeds to be used by businesses on payroll costs, interest on mortgages, rent, and utilities. The PPP allows the interest and principal to be forgiven if businesses spend the proceeds on these expenses within eight weeks of receipt and use at least 75 percent of the forgiven amount for payroll.
Unfortunately, some who applied and were given PPP loans either misunderstood the provisions of the CARES Act, or purposefully took measures to provide false information to pump up their loans. Some fraud was inevitable given the rapid implementation of the loan program.
Also inevitable is the federal government’s interest in pursuing those who may have fraudulently obtained loan funds. The FBI is actively looking into suspicious loans.
Adams Law Group is one of just a handful of criminal defense firms with an active white collar crime practice. This practice includes work on fraud accusations.
