Bills Extend Statute of Limitation for Prosecuting PPP, EIDL Fraud
President Joe Biden recently signed two bills allowing the federal government more time to find and prosecute fraud related to the Paycheck Protection Program (PPP) and COVID-19 Economic Injury Disaster Loans (EIDL).
Both bills passed Congress with bipartisan support. H.R. 7352, the "PPP and Bank Fraud Enforcement Harmonization Act of 2022," extends to 10 years the statute of limitation for fraud charges to be brought in relation to first- or second-draw PPP loan applications. H.R. 7334, the "COVID-19 EIDL Fraud Statute of Limitations Act of 2022," allows prosecutors 10 years to file fraud charges related to loan applications from the COVID-19-related EIDL program, including EIDL advances and Targeted EIDL advances. The bills state that any criminal charge or civil enforcement action alleging fraud shall be filed not later than 10 years after the offense was committed.
In October 2020, the U.S. Small Business Administration's Office of Inspector General (OIG) identified $78.1 billion in potentially fraudulent EIDL loans and grants distributed to ineligible entities, as well as $6.7 billion in loans and grants associated with alleged identity theft. In 2021, the OIG identified over 70,000 potentially fraudulent PPP loans totaling more than $4.6 billion.
To address COVID-19-related fraud, President Biden announced the appointment of a Justice Department special prosecutor in March of this year.