White Collar Offenses

Paycheck Protection Program Enforcement Continues

Published on: October 25, 2024 | By Conaway & Strickler, P.C.

As discussed in our prior blogs, the Department of Justice has already been prosecuting cases of larger-scale, outright PPP fraud. In August 2022, President Biden signed two bills into law that give the Department of Justice and other federal agencies more time to investigate and prosecute Paycheck Protection Program (“PPP”) and COVID-19 Economic Injury Disaster Loan (“EIDL”) cases. H.R. 7352, the “PPP and Bank Fraud Enforcement Harmonization Act of 2022” and H.R. 7334, the “COVID-19 EIDL Fraud Statute of Limitations Act of 2022” extend the statute of limitations for fraud charges involving PPP and EIDL fraud to ten years. This has allowed the government more time to prosecute these cases. And they continue to do so with increasing frequency. Recently the government was involved in prosecuting this covid-19 related schemes,

In investigating PPP loan fraud, the government first looks at the application itself. How many employees does the company have? Does that number match their payroll tax filings? Are the 941‘s the same as what is on file at the IRS? Has the owner(s) been convicted of or pled guilty to a felony with the past 5 years? Do the bank statements submitted on the PPP loan application match the actual bank statements? Are there business expenses on the bank statements? Was the bank account in a business checking account? When was the entity created? Did the company apply for more than one loan? Does the individual owner have multiple entities and apply for multiple loans? Any inaccurate statements on the application can result in a charge under Under 18 U.S.C. § 1344 (bank fraud) – making false statements to an FDIC-insured financial institution, or making false statements to the SBA. In addition, the CARES Act also has requirements for how companies use, and account for the use of, PPP loan funds. Some of the more outrageous PPP loan fraud prosecutions have resulted due to individuals buying Range Rovers, Lamborghinis and rolex watches with PPP loan proeeeds, i.e. converting PPP loan funds for personal use. Also, when seeking forgiveness for loans, companies must be very careful in what they submit. Any false documentation submitted can result in prosecution.

So, should the government be inquiring about your PPP loan(s) or EIDL loans or any disaster relief funds, it is important to contact us immediately. Being evasive or being unable to produce documentation of PPP Compliance will only increase issues that you will be facing. Allow Conaway & Strickler, PC to help you with expert advice from experienced federal counsel. We are very familiar with the federal criminal investigative process with the SBA-OIG, IRS and the DOJ.

How is White Collar Crime Generally Prosecuted?

Published on: July 10, 2023 | By Conaway & Strickler, P.C.

The Department of Justice investigates and prosecutes cases where large amounts of money is alleged to have been taken. Examples of white collar crimes are money laundering, bank, wire and mail fraud, tax evasion, insider trading, insurance fraud, mortgage fraud, bribery and embezzlement. Of course Homeland Security, the FBI, the IRS, Customs and Border Patrol and SEC can also investigate and prosecute cases of fraud as well.

The government has a special United States Guideline Chapter dedicated to “basic” economic offenses. For purposes of this blog, this chapter will be discussed in more detail below. As with anything involving federal criminal litigation, nothing is crystal clear in the law. Therefore, there is also a chapter in the United States Guidelines dedicated to tax offenses, election fraud, gambling, and money laundering in the United States Sentencing Guidelines.

This USSG chapter DOES cover extortion, bribery, kickbacks, counterfeiting, embezzlement, health care fraud, computer fraud, insurance fraud, securities fraud, mortgage fraud, identity fraud, bankruptcy fraud, etc. What is most important in this chapter is the loss amount. All charges start off with a base offense level of 6 or 7 depending on the statutory max of the offense charged. Then, you look at what the “loss amount” is using the below table.

Loss (apply the greatest)	Increase in Level
(A) $6,500 or less	no increase
(B) More than $6,500	add 2
(C) More than $15,000	add 4
(D) More than $40,000	add 6
(E) More than $95,000	add 8
(F) More than $150,000	add 10
(G) More than $250,000	add 12
(H) More than $550,000	add 14
(I) More than $1,500,000	add 16
(J) More than $3,500,000	add 18
(K) More than $9,500,000	add 20
(L) More than $25,000,000	add 22
(M) More than $65,000,000	add 24
(N) More than $150,000,000	add 26
(O) More than $250,000,000	add 28
(P) More than $550,000,000	add 30.

The loss amount is a pandora box of confusion and the government is able to add all kinds of relevant conduct and intended loss conduct to inflate these numbers.

To further make things complicated, there are enhancements in this section that permit the government to add levels for things such as the use of sophisticated means, role in the offense, number of victims, a defrauding a charity, mass marketing, among others.

Navigating the federal criminal system is a task that should not be endured alone. Contact our team today for more information about we can protect your rights and your freedom.

Federal Criminal Law – Wire Fraud and Possible Alternatives

Published on: March 26, 2023 | By Conaway & Strickler, P.C.

By Brandon Fitz

Wire Fraud is a serious white-collar crime and is defined under 18 USC §1343 and states:

Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, transmits or causes to be transmitted by means of wire, radio, or television communication in interstate or foreign commerce, any writings, signs, signals, pictures, or sounds for the purpose of executing such scheme or artifice, shall be fined under this title or imprisoned not more than 20 years, or both. If the violation occurs in relation to, or involving any benefit authorized, transported, transmitted, transferred, disbursed, or paid in connection with, a presidentially declared major disaster or emergency (as those terms are defined in section 102 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5122)), or affects a financial institution, such person shall be fined not more than $1,000,000 or imprisoned not more than 30 years, or both. 18 U.S.C.A. § 1343.

The Department of Justice in the Northern District of Georgia Federal Court will add a New Pretrial Diversion Court

Published on: May 9, 2022 | By Conaway & Strickler, P.C.

On April 11, 2022, the Northern District of Georgia in Atlanta announced the creation of a new pretrial diversion court, the Accountability, Treatment, and Leadership Court “ATL Court“. It is formed with the Northern District of Georgia, the U.S. Probation Office, the U.S. Attorney’s Office, and the Federal Defender Program, and will be run by folks from each of these agencies who will be known as the ATL Court Team. Please note: The ATL Court is in addition to, and not a replacement of, the Northern District of Georgia’s existing Pretrial Diversion Program.

“THE ATL COURT MISSION: Our mission is to provide the opportunity to avoid some of the consequences of aberrant criminal conduct to certain individuals charged with non-violent crimes in the Northern District of Georgia who would most greatly benefit from intense supervision, education, or treatment.”

HOW ATL COURT WORKS

SEC Complaint, RICO, Securities Fraud – biggest case against financial crime in SDNY in a long time

Published on: April 28, 2022 | By Conaway & Strickler, P.C.

Manhattan federal agents arrested Archegos Capital Management founder Sung Kook “Bill” Hwang on April 27, 2022 on fraud charges, roughly one year after the investment firm’s huge losses back in March 2021. Department of Justice prosecutors are charging both Hwang and Patrick Halligan, the firm’s chief financial officer, with racketeering conspiracy, securities fraud and wire fraud offenses as part of schemes allegedly designed to “unlawfully manipulate” the price of publicly traded securities.

The 59-page indictment, filed in federal court in Manhattan, alleges the men and others at Archegos sometimes timed their trades to drum up the interest of other investors, while borrowing money to make bigger and bigger bets. The Department of Justice states, “Hwang and his co-conspirators invested in stocks mostly through special contracts with banks and brokers called “swaps.” As alleged, these swaps allowed Hwang to cause massive buying of certain stocks, including at carefully selected days and times, to artificially pump up stock prices. Hwang, Halligan, and their co-conspirators lied to banks and used a series of manipulative trading techniques to keep those prices high and prevent them from falling. The lies fed the inflation, and the inflation led to more lies. The scale of this alleged fraud was stunning. In one year, Hwang turned a $1.5 billion portfolio and fraudulently pumped it up into a $35 billion portfolio.” The effective size of the firm’s stock positions swelled to $160 billion — rivaling some of the biggest hedge funds in the world. The case marks the biggest financial-crime charges to come out of the Southern District of New York under the leadership of Mr. Damian Williams, who was sworn in October 10, 2021.

The SEC has also filed a civil complaint stating that Mr. Becker, the former chief risk officer at Archegos, and Mr. Tomita, the firm’s former top trader, had led discussions with the banks about the firm’s trading positions but that Mr. Hwang and Mr. Halligan had directed and set the tone for those discussions.

What are the current DOJ priorities?

Published on: April 1, 2022 | By Conaway & Strickler, P.C.

Attorney General Merrick Garland made recent comments about what he considered to be the Department of Justice’s top priorities for 2022. Since taking office in March 2021, Garland has tried to combat crime in a tumultuous time. He has been criticized for his handling of January 6 investigation and has stated it’s the most urgent probe in history.

With all of this going on, the US Attorney’s office increased its prosecutions of individuals of white collar crimes in the year 2021. White collar charges like fraud, theft, corruption, bribery, environmental crime, tax fraud, health care fraud, procurement fraud, money laundering, PPP loan fraud, etc will continue to get more attention from the Department of Justice.

What does this mean? It means that investigations of any sort need to be taken seriously and that you should contact a lawyer immediately if any wrongdoing is alleged.

Q&A Grand Jury subpoenas

Published on: December 16, 2021 | By Conaway & Strickler, P.C.

What is a Grand Jury?

The purpose of the grand jury is to determine whether or not there is probable cause to believe that any federal felony has been committed. A typical federal grand jury consists of between 16-23 citizens drawn from the community.

The jurors meet in a closed courtroom, with no judge, no accused, no press, and no lawyer but the prosecutor present. This means your lawyer will NOT be present in the closed court room. The grand jurors decide whether or not to indict a person or persons by listening to witnesses and evaluating evidence obtained by grand jury subpoenas. At least 12 grand jurors must find that there is sufficient probable cause in order to return a True Bill, which when signed by the prosecutor becomes the indictment: the formal criminal charge that the government must prove beyond a reasonable doubt at trial. If the grand jury does not find sufficient probable cause, which almost never occurs, then it returns a No Bill.

Covid-19 Fraud Enforcement Task Force established

Published on: May 26, 2021 | By Conaway & Strickler, P.C.

The Department of Justice just announced that U.S. Attorney General Merrick B. Garland created COVID-19 Fraud Enforcement Task Force to enhance enforcement efforts against COVID-19 related fraud.

Cases have included:

Offers to purchase COVID-19 vaccination cards

Can you prevent corporate crime from destroying your reputation?

Published on: August 30, 2019 | By Conaway & Strickler, P.C.

Your involvement in a corporate crime at your workplace in Georgia can lead to several consequences including the loss of your job, loss of integrity and a significant blow to your reputation. Often, regardless of the misbehavior, you were caught committing, chances are there are at least a few people who have lost their trust in you completely. Recovering their trust and showing that you are not the same person is going to take considerable time and commitment.

Unfortunately, your reputation infiltrates many components of your life, especially important ones where family, friends, potential coworkers and other professionals are tasked with making a decision about whether or not you can be trusted to perform a certain way. Rebuilding the way people think of you is critical to your being able to grow and maintain relationships. According to Entrepreneur, you have the potential to prevent your involvement in crime from destroying your reputation entirely, but only if you begin making amends right away. One thing you should begin doing is setting realistic goals of how you will overcome your mistakes and fix the way people see you.

Depending on the crime you were involved in, you may be required to pay legal consequences including fines or jail time. Being timely and responsible in the way you pay your dues is critical to your ability to begin recovering from your mistakes right away. The more willing you are to take responsibility for what you have done and refrain from placing blame on anyone else, you can show that you are serious about making a change.

Identity theft types and prevention

Published on: August 6, 2019 | By Conaway & Strickler, P.C.

There are many ways that Georgia residents can fall victim to identity theft. When this happens, it can be costly, both financially and timewise. It can take a while to restore credit scores and reputation with financial institutions. It is important that everyone understands how identity theft can occur so individuals can take steps to prevent it from happening.

According to USA.gov, the most typical types of identity theft are medical ID, tax ID and social ID theft. With medical, someone uses another person’s health insurance or Medicare number to get medical care. Thieves steal social security numbers for multiple reasons, but a common one is to file tax returns in a false manner. In social identity theft, thieves use someone else’s name and pictures to set up fake social media accounts.

The two most vulnerable age groups to ID theft are seniors and children. There are numerous ways someone can prevent being a victim of identity theft. These include: