Legal Risks Associated with PPP Loan Applications

Annie Railton, a Goodwin partner who specializes in white-collar criminal defense, government civil investigations and enforcement proceedings joins Thejo Kote, CEO at Airbase, in a session which will consider the legal risks associated with companies applying for loans under the CARES Act. The Payroll Protection Program raises important legal questions for companies that have applied for funds, even those that may have returned funds or are planning to repay them. Ms. Railton will provide important insight into the False Claims Act and how it is used to bring cases against companies that accept government funds outside of full compliance. For companies that have applied for PPP government funds or are considering doing so, there are ways to prepare for long term exposure to legal scrutiny. The session will discuss how legal liability is created for individuals, company management, board members, and even investors when an application is made and what can be done to mitigate that risk. The sessions will also cover the additional clarity being provided by the SBA around the interpretation of “necessity” and their decision to extend the safe harbor period for PPP applicants to return funds. Ms. Railton will describe the incentives and landscape for oversight by various entities including the Department of Justice, CARES Act oversight bodies, and whistleblowers.

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