Harter Secrest & Emery LLP, a full-service business law firm with offices throughout New York, has launched on its website at www.hselaw.com an online and comprehensive resource to track the government’s enforcement of COVID-19 financial aid programs. While uncertainty continues to be a reality for businesses and organizations due to the COVID-19 pandemic and related economic challenges, there is one certainty: the government audits and enforcement to come.
Since the first criminal charges were filed by the Department of Justice on May 5, in response to an alleged fraudulent PPP loan application, filings have and will continue to roll in. These claims span the country and range from individuals and companies falsifying information on the loan application to improperly using loan funds.
While many claims will reflect extreme and obvious abuse of the PPP and EIDL programs, others will not. And, if enforcement here follows precedent, the early simple criminal cases against fraudulent borrowers will multiply and be followed by more nuanced criminal and civil cases against larger institutions, like agents, brokers, and lenders. Harter Secrest & Emery attorneys are monitoring and advising clients on this evolving situation and have organized, and are now making available, a collection of continually updated documents tracking the government’s latest actions to date.
The HSE COVID-19 Federal Aid Program page provides insights and perspectives on the entire lifecycle of participation in a COVID-19 financial aid program:
- Tracking criminal and civil fraud enforcement actions by the U.S. Department of Justice
- Tracking key judicial decisions on COVID-19 federal aid programs
- Compiling the core laws, rules and forms governing the PPP and COVID-19-related EIDL program
Additionally, the page provides guidance for preparing for a potential audit. The Small Business Administration (SBA) has announced that all PPP loans of $2 million or more will be subject to an audit; however, they are also reserving the right to “spot check” loans of lower amounts. While it is too soon to say how in depth the audits will be, HSE attorneys provide an overview of the anticipated audit scope and recommendations for preparation.
“We have designed this page to be a resource for anyone interested in actively tracking the government’s enforcement activities as they multiply,” said Brian M. Feldman, HSE partner and chair of the firm’s Government and Internal Investigations practice. “In one place, you can now track all of the Justice Department’s enforcement actions alongside key PPP judicial decisions, which will be updated weekly, and supplemented by the core sets of documents governing these financial aid programs. This page provides one-stop shopping for anyone—in-house counsel, white collar defense lawyers, academics, and prosecutors alike—interested in most comprehensive collection of COVID-19 enforcement materials.”
Feldman, who is former Assistant U.S. Attorney in the U.S. Attorney’s Office for the Southern District of New York in Manhattan, leads the HSE team advising clients on this evolving situation. The team consists of attorneys who counsel clients on the PPP loan and forgiveness applications, audits; enforcements, investigations and litigations; and related tax matters.
The HSE Government and Internal Investigations group represents organizations and individuals facing government investigations. Our attorneys represent clients in a wide range of federal, state and local civil, regulatory and criminal investigations. The group’s experience includes counseling clients on matters related to antitrust, civil rights, False Claims Act, health care, fraud, securities, and tax evasion investigations.