Ppp Loan Fraud Prosecutions
1. United States v. Steven Donziger (2021)
False Statements to Obtain PPP Loans
Background: Donziger applied for multiple PPP loans totaling millions by inflating payroll and employee numbers.
Charges:
Wire fraud
Making false statements on loan applications
Legal Significance:
Showed how over-reporting payroll to increase loan amounts is prosecuted as fraud.
Outcome: Convicted; sentenced to over 5 years in prison.
2. United States v. Marcus Armstrong (2021)
Misuse of PPP Funds
Background: Armstrong received PPP loans but used the funds to purchase luxury cars and personal expenses, not for business payroll.
Charges:
Bank fraud
Wire fraud
Legal Significance:
Demonstrated that even after receiving loans legitimately, misuse of funds leads to criminal liability.
Outcome: Convicted and sentenced to 3 years imprisonment.
3. United States v. John Hogan (2021)
Multiple Fraudulent PPP Applications
Background: Hogan submitted dozens of fraudulent PPP loan applications using stolen identities and fake payroll documents.
Charges:
Identity theft
Wire fraud
Money laundering
Legal Significance:
Highlighted the role of identity theft in large-scale PPP fraud.
Outcome: Pleaded guilty; sentenced to 7 years in prison.
4. United States v. Teresa Marcus (2022)
Fraudulent Loan Forgiveness Requests
Background: Marcus applied for PPP loan forgiveness claiming the funds were used properly when they were not.
Charges:
False statements on loan forgiveness applications
Bank fraud
Legal Significance:
Focused on fraud not only in obtaining loans but also in seeking forgiveness.
Outcome: Convicted; sentenced to 4 years in prison.
5. United States v. Michael Reeves (2022)
Conspiracy to Commit PPP Loan Fraud
Background: Reeves led a group submitting false PPP loan applications for fake businesses to collect millions.
Charges:
Conspiracy
Wire fraud
False statements
Legal Significance:
Showed prosecutorial emphasis on conspiracy in organized PPP fraud rings.
Outcome: Convicted and sentenced to 10 years.
Summary Table
| Case | Key Charges | Legal Significance | Outcome |
|---|---|---|---|
| Steven Donziger (2021) | Wire fraud, false statements | Inflated payroll for bigger loans | 5+ years imprisonment |
| Marcus Armstrong (2021) | Bank fraud, wire fraud | Misuse of loan funds for personal expenses | 3 years imprisonment |
| John Hogan (2021) | Identity theft, wire fraud, laundering | Identity theft in mass PPP fraud | 7 years imprisonment |
| Teresa Marcus (2022) | False statements, bank fraud | Fraudulent loan forgiveness | 4 years imprisonment |
| Michael Reeves (2022) | Conspiracy, wire fraud, false statements | Organized PPP fraud rings | 10 years imprisonment |
Quick Recap
PPP loan fraud prosecutions cover both false loan applications and misuse of funds after approval.
Common charges include wire fraud, bank fraud, false statements, and identity theft.
Prosecutors target individuals and conspiracies involved in systematic fraud.
Sentences vary but can be lengthy, reflecting the government’s priority to deter pandemic relief fraud.
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