Insights

Washington – February 27, 2023: Global Investigations Review has named Crowell & Moring’s Investigations and White Collar & Regulatory Enforcement groups to its prestigious GIR 100 list, an annual guide to the world’s leading cross-border investigations practices. Based on extensive research, GIR selects 100 firms from around the world that it deems most able to handle sophisticated cross-border government-led and internal investigations. This is the eighth consecutive year that Crowell & Moring has made the list.

Congress recently announced an investigation into the role of certain financial technology (“FinTech”) firms and partner banks in issuing allegedly fraudulent Paycheck Protection Program (“PPP”) loans.  The May 28th press release from the House of Representatives’ Select Subcommittee on the Coronavirus Crisis cited recent reporting which “found that FinTechs and their bank partners handled 75 percent of the approved PPP loans that have been connected to fraud by DOJ, despite facilitating just 15 percent of PPP loans overall.”  This announcement follows closely on the heels of the Subcommittee’s March hearing on “Rooting Out Fraud in Small Business Relief Programs,” and marks yet another example of the scrutiny pandemic relief program participants will continue to face from regulators.  It also confirms that – despite severely relaxed underwriting requirements – FinTechs and their partner banks, in addition to PPP loan recipients, should be prepared for government scrutiny. 

On December 4, 2020, the Securities and Exchange Commission (SEC) announced its first charges against a public company for misleading statements regarding the financial impact of the COVID-19 pandemic. As part of the settlement, The Cheesecake Factory agreed to pay $125,000 and to cease-and-desist from any further violations of Section 13(a) of the Exchange Act and Rules 12b-20 and 13a-11 thereunder, which collectively require that issuers’ Form 8-K disclosures contain accurate, current reports that contain material information necessary to make the reports not misleading.

Eight months into the COVID-19 pandemic, the U.S. Department of Justice (DOJ) and its law enforcement partners are taking an increasingly aggressive approach to investigating and pursuing allegations of fraud related to federal relief programs designed to aid small businesses and their employees. Over the past week, the DOJ announced charges against 11 individuals in connection with two different COVID-19 relief fraud schemes. In each case, the individuals sought to illegally obtain millions of dollars in relief funds guaranteed by the Small Business Administration (SBA) through the Economic Injury Disaster Loan (EIDL) and the Paycheck Protection Program (PPP).

Crowell & Moring's New York based White Collar and Regulatory Enforcement attorneys Rebecca Ricigliano and Arlen Pyenson will speak at the New York Women’s Bar Association (NYWBA) Criminal Law and Federal Practice Committees’ April 19th CLE Program. The CLE, which will be hosted by Crowell & Moring’s New York Office, will discuss “When A Civil Enforcement Action Turns Criminal.”