he Paycheck Protection Program (PPP) loans program has raised concerns about fraud and abuse given the speed in approving loans and releasing funds. On June 25, the Government Accountability Office (GAO) issued a report highlighting the risk of fraud for PPP loans and the need for reviewing borrower eligibility, calculation of loans, and use of funds.
The DOJ has begun issuing criminal charges. The DOJ charged two Rhode Island businessmen for PPP fraud based on allegations they obtained over $500,000 after claiming to have numerous employees for multiple corporate entities when in fact the entities had not been operating prior to the pandemic and had no employees or were not owned by the men.
The DOJ charged an Atlanta reality TV personality for PPP fraud based on allegations he misused millions obtained for his trucking business to purchase jewelry, lease a Rolls Royce, make payments for child support and a Ponzi scheme, and other expenses. The DOJ charged a Massachusetts businessman who allegedly submitted fraudulent applications to receive more than $2 million for his information technology services company by misrepresenting the number of employees and payroll expenses and falsely certifying the US was the primary residence for his employees.
Please let us know if we can help your business with this process including an assessment of any potential risks. Contact us today!
https://www.gao.gov/reports/GAO-20-625/ (GAO Report)
https://www.justice.gov/opa/pr/two-charged-rhode-island-stimulus-fraud (Rhode Island criminal charges)
https://www.justice.gov/opa/pr/reality-tv-personality-charged-bank-fraud (Atlanta criminal charges)
https://www.justice.gov/opa/pr/massachusetts-man-charged-covid-relief-fraud (Massachusetts criminal charges)