How COVID-19 Has Affected the Government’s Ability to Investigate and Prosecute White-collar Crime
DIFFICULTIES IN INVESTIGATION
The COVID-19 pandemic has affected our world in ways that we still don’t fully understand yet. It does not require a blog such as this for anyone to understand that pretty much everything we once knew as normal has possibly changed forever due to COVID-19. One impact that COVID-19 has had is on the government’s ability to investigate and prosecute white-collar crime. The health and safety of federal agents, prosecutors, and other government employees is an obvious priority of the government at the current time. It is not surprising that that federal agents might not be as excited to execute search warrants or perform “knock and talks” in places where there could be a great risk of exposure to the virus. Overall, the ability of investigators to explore and develop white-collar cases has been limited due to the difficulties of questioning witnesses in person. This obstacle has made it even more difficult to discuss the sensitive and confidential information which is at the heart of most white-collar crime cases. One area of focus for federal agents that has changed because of COVID-19 is the Foreign Corrupt Practices Act (FCPA). It is expected that in the short term, white-collar crimes related to the enforcement of the FCPA will be less prevalent due to the inability of Americans to currently travel internationally.
ANTICIPATED LONG-TERM FOCUS OF THE GOVERNMENT
The COVID-19 pandemic saw the federal government passing the Coronavirus Act, Relief and Economic Security Act (CARES Act) in order to help the economy stay afloat while the world figures out how to move forward safely. The CARES Act injected over $2 trillion into the United States economy in a variety of ways. With all of this additional money being made available, it is natural to expect that there will be a rise in fraudulent activities related to CARES Act money. To monitor and combat CARES Act fraud, Congress established the Office of the Special Inspector General for Pandemic Recovery (SIGPR) along with the CARES Act. This office will have the authority to oversee and investigate fraud related to CARES Act loans made to businesses during the pandemic. During the 2008 financial crisis, a similar economic stimulus program known as the Troubled Asset Relief Program (TARP), saw fraud charges and convictions for hundreds of people in relation to over $10 billion in misused government relief funds. In the longer term, it is expected that the SIGPR office will look to investigate and help prosecute those who are suspected of committing fraud in both obtaining and using CARES Act money.
HOW DOES THIS AFFECT ME?
If you received any funding from the CARES Act during this unprecedented time, then you may be at risk for prosecution. Any misstatements on loan applications will not be viewed in the most favorable light by investigators as the government will be specifically looking for suspected fraudsters to investigate and prosecute. Funding for small businesses under the CARES Act is expected to be used for specific businesses expenditures and any violation of these rules can result in serious federal criminal charges. Criminal charges against those who are suspected of using Paycheck Protection Program (PPP) loans for personal expenditures for instance have already started to surface in the federal criminal justice system nationwide. This trend will only continue as these cases are more fully investigated and developed. If you took money under the CARES Act, then it is good practice to speak to an experienced federal criminal defense attorney to understand what your responsibilities are, and to protect yourself in case there are potential legal issues. It is your responsibility to follow these guidelines, and a failure to do so can result in federal criminal charges.
