The FBI and Justice Department are increasing their efforts to investigate and prosecute companies suspected of fraudulently obtaining Paycheck Protection Program (PPP) loans during the COVID-19 pandemic. The PPP program allowed small businesses, including senior living and skilled nursing operators, to access a bailout fund to pay bills and keep workers employed.

According to the Small Business Administration inspector general, an estimated 17% of PPP loans were distributed to businesses and individuals who committed fraud. Thousands of investigations have been opened across the country targeting COVID-19 related fraud, with hundreds of individuals already facing criminal charges.

In one recent case, the owner of an assisted living community was sentenced to two years in federal prison for fraudulently obtaining over $1 million in PPP funds, which were used for personal gain. In another case, 11 individuals from four states were indicted for submitting false and fraudulent PPP loan applications, resulting in over $220,000 in fraudulent loans being issued.

Additionally, the government has indicated that it will investigate instances of fraud regarding PPP loans that have already been forgiven.

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