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White Collar Week with Jeff Grant, Podcast Ep. 09: Small Business Edition, with Guest: Taxgirl Kelly Phillips Erb

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White Collar Week with Jeff Grant

It’s the Isolation that Destroys Us. The Solution is in Community.

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Podcast Ep. 09: Small Business Edition, with Guest: Taxgirl Kelly Phillips Erb

Today on the podcast we have my colleague and friend, Kelly Phillips Erb.

Kelly is a tax attorney, business advisor and host of the Taxgirl Podcast. I reached out to Kelly after reading her column in Forbes about SBA PPP loans. She read my article on Entrepreneur.com (over 350,000 views folks!) on the same subject, and she invited me to be on her podcast. She followed up the podcast with another article in Forbes, As Law Enforcement Pursues SBA Loan Fraud, Jeff Grant Talks Redemption.

It was one of my favorite interviews ever. 

Today’s podcast continues our conversation, and broadens it to include good, solid business and tax strategies that small businesspeople can use to get through these distressing economic times. While many small businesses will unfortunately certainly go under during this pandemic, others will reset, repurpose and flourish. Of course, we also go into updated information about SBA PPP and EIDL loans.

So, coming up – our Small Business Edition. With Kelly Phillips Erb. On White Collar Week. I hope you will join us. – Jeff

Listen on Apple Podcasts:

Listen on Spotify:

Listen on SoundCloud:

https://soundcloud.com/whitecollarweek/ep-09-small-business

Watch on YouTube:

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If you have a friend, family member, colleague or client with a white collar justice issue, please forward this email; they can reach us anytime – day or night! Our contact info: http://prisonist.org/contact-us.

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Guest on this Episode:

Kelly Phillips Erb: Years ago, I found myself sitting in law school in Moot Court wearing an oversized itchy blue suit. It was a horrible experience. In a desperate attempt to avoid anything like that in the future I enrolled in a tax course. I loved it. I signed up for another. Before I knew it, in addition to my J.D., I had an L.L.M. Taxation. I needed only to don my cape… Taxgirl® was born.

While at law school, I interned at the estate & gift attorney division of the Internal Revenue Service (IRS). At IRS, I participated in the review and audit of federal estate tax returns. At one audit, where I was the lead, opposing counsel read my report, looked at his file, and said, “Gentlemen, she’s exactly right.” I nearly fainted.

Today, I am a managing shareholder at The Erb Law Firm, P.C., where I focus on tax law including domestic and international estate and tax planning; tax compliance and controversy matters such as tax delinquencies, offers in compromise, and audits. I am licensed to practice in PA, NJ, and in the U.S. Tax Court. I am also permitted to practice law on a pro bono basis in NC through the Legal Aid of North Carolina.

In addition to my legal practice, I write extensively about tax. I am a Senior Contributor at Forbes where I write about tax and tax policy, including tax-related security & technology issues. I also have a regular column at Bloomberg Tax – you can catch my latest post here.

I’ve written and been interviewed about taxes for CNN Money, CNBC, Reuters, Time, and US News & World. I’ve also been asked to explain taxes in plain English by media outlets like National Public Radio’s Marketplace, Esquire, CBS Radio, Inc., Martha Stewart’s Living, and Marketwatch, and a number of podcasts.

I’ve appeared in a number of books, including authoring a chapter on careers in tax law for the American Bar Association. I’ve published Ask the TaxGirl: Everything Parents Should Know About Filing Taxes and Home, Sweet, Rental: Busting the Hype of Homeownership together with Forbes, and I’ve created and co-authored 100 Things You Need To Know About Money  (Forbes’ most successful e-book).

I still give interviews and speak as much as my schedule will allow. You might have seen (or heard) me recently in El Paso where I presented on Tax Tips for Freelancers and Small Businesses in the Travel Industry for SATW; in Lisbon where I spoke about tax evasion and sports (with an emphasis on soccer) for the Warwick Legal Network; or in Vegas at the National Association of Enrolled Agents (NAEA) where I opened the conference addressing challenges in the tax profession.

You can find more about what I write and what I’m doing here. (Did I mention that I drink a lot of coffee?)

And just to clarify, there are a number of folks flitting about the internet who feel that it’s okay to use my trademarks (Taxgirl®, Ask The Taxgirl® and Taxes From A To Z®). It’s not. If you find yourself a bit confused, here are a few tips:

  • If it says Taxgirl® and doesn’t talk about tax, it’s probably not me. And if it’s giggly stuff about staying out too late and partying, also not me (I have three kids, who are you kidding?).

  • And if it involves anything illicit, definitely not me – remember, my mother could be reading.

  • I don’t answer questions on yahoo.com or other sites like Quora or sell tax (or other) software.

  • Most importantly, if it’s a tax site not affiliated with taxgirl.com, it’s not me.

You can reach Kelly Phillips Erb at: kelly.erb@taxgirl.com, taxgirl.com

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You can find all episodes of our podcast “White Collar Week with Jeff Grant” on our website prisonist.org, our Facebook page, Podbean, YouTube (video), SoundCloud, Apple Podcasts, Spotify, LinkedIn, Instagram and Twitter.

Information About our White Collar Support Group…

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Louis Reed/Babz Rawls Ivy PSA:

Some very kind words from my dear friends Louis L. Reed and Babz Rawls Ivy in this brief PSA. Thank you Louis and Babz! – Jeff

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All Episodes:

Link here to Podcast Ep. 20: Glenn E. Martin & Richard Bronson: Reinventing Yourself After Prison

Link here to Podcast Ep. 19: Insider Trading Charges Dismissed, with Guest Richard Lee

Link here to Podcast Ep. 18: Is Your Life a Movie? The Producers, with Guests: Lydia B. Smith, Bethany Jones & Will Nix

Link here to Podcast Ep. 17: #TruthHeals: Systemic Abuse & Institutional Reform with Vanessa Osage, feat. Guest Co-Host Chloe Coppola

Link here to Podcast Ep. 16: Politicians, Prison & Penitence, with Guest: Bridgeport, CT Mayor Joseph Ganim

Link here to Podcast Ep. 15: A Brave Talk About Suicide, with Guests Bob Flanagan, Elizabeth Kelley, & Meredith Atwood

Link here to Podcast Ep. 14: Recovery & Neighborhood, with Guest: TNP’s Tom Scott

Link here to Podcast Ep. 13: Everything but Bridgegate, with Guest: Bill Baroni

Link here to Podcast Ep. 12: The Truth Tellers, with Guests: Holli Coulman & Larry Levine

Link here to Podcast Ep. 11: The Blank Canvas, with Guest: Craig Stanland

Link here to Podcast Ep. 10: The Ministers, with Guests: Father Joe Ciccone & Father Rix Thorsell

Link here to Podcast Ep. 09: Small Business Edition, with Guest: Taxgirl Kelly Phillips Erb

Link here to Podcast Ep. 08: The Academics, with Guests: Cathryn Lavery, Jessica Henry, Jay Kennedy & Erin Harbinson

Link here to Podcast Ep. 07: White Collar Wives. with Guests: Lynn Springer, Cassie Monaco & Julie Bennett. Special Guest: Skylar Cluett

Link here to Podcast Ep. 06: Madoff Talks, with Guest: Jim Campbell

Link here to Podcast Ep. 05: Trauma and Healing when Mom goes to Prison, with Guests: Jacqueline Polverari and Her Daughters, Alexa & Maria

Link here to Podcast Ep. 04: One-on-One with Tipper X: Tom Hardin

Link here to Podcast Ep. 03: Compassionate Lawyering: Guests, Chris Poulos, Corey Brinson, Bob Herbst & George Hritz

Link here to Podcast Ep. 02: Substance Abuse & Recovery During COVID-19: Guests, Trevor Shevin & Joshua Cagney

Link here to Podcast Ep. 01: Prison & Reentry in the Age of COVID-19: An Evening with Our White Collar Support Group.

Link here to Podcast Ep. 00: White Collar Week with Jeff Grant: What is White Collar Week?

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What is the White Collar Justice Community?

Welcome to White Collar Week with Jeff Grant, a podcast serving the white collar justice community. It’s the isolation that destroys us. The solution is in community.

If you are interested in this podcast, then you are probably already a member of the white collar justice community – even if you don’t quite know it yet.  Our community is certainly made up of people being prosecuted, or who have already been prosecuted, for white collar crimes. But it is also made up of the spouses, children and families of those prosecuted for white collar crimes – these are the first victims of white collar crime. And the community also consists of the other victims, both direct and indirect, and those in the wider white collar ecosystem like friends, colleagues, prosecutors, defense attorneys, judges, law enforcement, academics, researchers. Investigators, mitigation experts, corrections officers, reentry professionals, mental health care professionals, drug and alcohol counselors, – and ministers, chaplains and advocates for criminal and social justice reform. The list goes on and on…

In this very eventful summer 2020, our mission is to introduce you to other members of the white collar justice community, to hear their very personal stories, and hopefully gain a broader perspective of what this is really all about. Maybe this will inspire some deeper thoughts and introspection? Maybe it will inspire some empathy and compassion for people you might otherwise resent or dismiss? And maybe it will help lift us all out of our own isolation and into community, so we can learn to live again in the sunshine of the spirit.

Along the way, I’ll share with you some of the things I’ve learned in my own journey from successful lawyer, to prescription opioid addict, white collar crime, suicide attempt, disbarment, destruction of my marriage, and the almost 14 months I served in a Federal prison. And also my recovery, love story I share with my wife Lynn Springer, after prison earning a Master of Divinity from Union Theological Seminary in NYC, pastoring in an inner city church in Bridgeport CT, and then co-founding with Lynn in Greenwich CT, Progressive Prison Ministries, the world’s first ministry serving the white collar justice community. It’s been quite a ride, but I firmly believe that the best is yet to come.

So I invite you to come along with me as we experience something new, and bold, and different this summer – a podcast that serves the entire white collar justice community. I hope you will join me.

Blessings, לשלום

Jeff

Rev. Jeff Grant, J.D., M.Div. (he, him, his) 
Co-founder, Progressive Prison Ministries, Inc., Greenwich CT & Nationwide
Co-host, The Criminal Justice Insider Podcast
Host, White Collar Week
Mailing: P.O. Box 1, Woodbury, CT 06798
Website: prisonist.org
Email: jgrant@prisonist.org
Office: 203-405-6249
Donations (501c3): http://bit.ly/donate35T9kMZ
Psychology Today: https://www.psychologytoday.com/us/therapists/jeff-grant-woodbury-ct/731344
LinkedIn: https://www.linkedin.com/in/revjeffgrant
not a prison coach, not a prison consultant

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Thank you for listening to White Collar Week.

Please subscribe, rate and review the podcast if you loved it – it helps others suffering in silence find us if they need us!

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Follow White Collar Week on Social:

Web: https://prisonist.org/white-collar-week

Facebook: https://facebook.com/whitecollarweek

Twitter: https://twitter.com/whitecollarweek

Instagram: https://instagram.com/whitecollarweek

LinkedIn: https://linkedin/whitecollarweek

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Follow Jeff Grant on Social:

Web: https://prisonist.org

Facebook: https://Facebook.com/revjeffgrant

Twitter: https://twitter.com/revjeffgrant

Instagram: https://instagram.com/revjeffgrant

LinkedIn: https://linkedin/revjeffgrant

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Want to be a guest on the Show? Have a connection you’d like to make?

Email us! info@prisonist.org

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Credits:

Host: Jeff Grant, J.D., M.Div.

Audio Engineering: George Antonios: https://georgeantonios.com

Video Engineering: Todd Nixon

Art Direction: Greyskye Marketing, LLC: https://greyskye.com

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It’s the Isolation that Destroys Us. The Solution is in Community.

Progressive Prison Ministries, Inc. is the world’s first ministry supporting the white collar justice community. Founded by husband and wife, Jeff Grant and Lynn Springer in Greenwich CT in 2012, we incorporated as a nonprofit in Connecticut in 2014, and received 501(c)(3) status in 2015.  Jeff has over three decades of experience in crisis management, business, law (former), reentry, recovery (clean & sober 17+ years), and executive and religious leadership. As Jeff was incarcerated for a white-collar crime he committed in 2001, he and Lynn have a first-hand perspective on the trials and tribulations that white-collar families have to endure as they navigate the criminal justice system and life beyond.

Progressive Prison Ministries, Inc. is nonsectarian, serving those of all faiths, or no faith whatsoever. To date we have helped over three hundred fifty (350) individuals, and their families, to accept responsibility for their actions and to acknowledge the pain they have caused to others.  In accordance with our commitment to restorative justice, we counsel our members to make amends as a first step in changing their lives and moving towards a new spiritual way of living centered on hope, care, compassion, tolerance, empathy and service to others. Our team has grown to over ten people, most with advanced degrees, all of whom are currently volunteering their time and resources.

Progressive Prison Ministries’ goal is to provide spiritual solutions and emotional support to those who are feeling alone, isolated, and hopeless. We have found that these individuals are suffering from a void but are stuck, and don’t know what to do about it. Our objective is to help them find a path to a healthy, spirit-filled place on the other side of what may seem like insurmountable problems. Many of those we counsel are in a place where their previous lives have come to an end due to their transgressions. In many cases their legal problems have led to divorce, estrangement from their children, families, friends and support communities, and loss of a career. The toll this takes on individuals and families is emotionally devastating. White-collar crimes are often precipitated by other issues in the offenders’ lives such as alcohol or drug abuse, and/or a physical or mental illness that lead to financial issues that overwhelms their ability to be present for themselves and their families and cause poor decision making. We recognize that life often presents us with such circumstances, sometimes which lead us to make mistakes in violation of the law.

All conversations and communications between our ordained ministry, and licensed clinical relationships, and those we serve fall under state privilege laws. This is one reason that attorneys often allow and encourage their clients to maintain relationships with us while in active prosecution or litigation situations.

If you, a friend, family member, colleague or client are suffering from a white collar criminal justice issue or are experiencing some other traumatic or life-altering event, and would like to find a path to a healthy, spirit-filled place on the other side of what seems like insurmountable problems, please contact us to schedule an initial call or appointment.

Copyright 2020, All Rights Reserved, Progressive Prison Ministries, Inc.

 

Entrepreneur: I Went to Prison for S.B.A. Loan Fraud: 7 Things to Know When Taking COVID-19 Relief Money: by Jeff Grant, J.D., M.Div.

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Don’t let desperation cloud your judgment.

by Jeff Grant
Prison minister

7 min read

Opinions expressed by Entrepreneur contributors are their own.

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In the months after 9/11, I was frantic.

But my fears had less to do with the tragedy at the Word Trade Center and more to do with the fact that, after 10 years of rampant prescription opioid abuse, my business was failing. I was searching desperately for an out. Meanwhile, the television and radio were blaring with ads for 9/11 FEMA loans administered by the U.S. Small Business Administration.

So, on an especially bad day, I lied.

I said I had an office near ground zero. I received the SBA loan I requested, and immediately paid down the personal credit cards I had run up while waiting for the SBA money. Even so, the loan did little to stop my spiral into drug addiction, mental health issues, marital problems and magical thinking.

In 2002, I resigned my law license and started on the road to recovery. But it all caught up with me about 20 months later, when I was arrested for the misrepresentations on my loan application. I served almost 14 months at a Federal prison for wire fraud and money laundering.

My objective in writing this piece is to offer some insight on what business owners should consider before they take out disaster loans. Certainly, the majority of people requesting these loans are honest and upstanding entrepreneurs who have immense need for the aid, and will use the funds properly. I am very glad there is help for them. That said, history has shown us again and again that when people are in dire need, they’re more prone to make impulsive, ill-advised decisions. My hope is that sharing my experience will help others avoid the consequences I faced. Here are seven takeaways.

1. Desperate people do desperate things.

There were thousands of fraud prosecutions after 9/11, Hurricane Katrina, Superstorm Sandy, and so on. Why? Whether because of overwhelming business issues, poor personal judgment, or just plain bad luck, people were wounded, desperate and willing to do anything, anything, to stop the bleeding. But if the wound is too deep, a Band-aid is not sufficient.

Practice point: In any situation, behaving desperately is unlikely to save your business.

2. Beware of the belief that rules are suspended in times of emergency.

The government is advertising that huge amounts of money are available to save our businesses. I recently sat in on a webinar run by a very reputable business consulting group that recommended that attendees get their SBA disaster loan applications in immediately, regardless of the facts or the actual needs of their business — they said we could always modify our applications prior to taking the money. State unemployment websites are actually giving instructions, in writing, on how to mislead and circumvent the system in order to get approved. Don’t take the bait! If you default two years from now, this “good-meaning advice” won’t matter to prosecutors.

Practice point: Be truthful at all times.

3. Beware of magical thinking.

This is a tough one because entrepreneurs are inherently optimistic. We believe that things will always be better tomorrow than they are today. It drives us, makes us successful, informs our risk-taking. But in times of trauma, that voice can be an entrepreneur’s worst enemy. Does this sound familiar? We have learned the hard way that there is no shortcut, and yet we desperately want there to be one right now.

Practice point: Instead of immediately reaching for a bailout or other quick fix, develop a good solid business plan. Maybe a disaster loan will fit into this plan; maybe it won’t.

4. This paradigm shift will affect all small to mid-size businesses.

We are in the midst of a massive reordering that has already had a huge effect on small and mid-sized businesses. Business owners are being called to closely examine if our business models are still viable, or if we must pivot to new ways of doing things. Example: the Swiss watch industry completely missed the shift to digital watches. Have we waited too long to have a robust online presence? Are our products or services even needed anymore? Have we been holding on by a thread for years, unwilling or unable to look at the hard facts?

Practice point: Get real, now. Don’t borrow money to save a business that can’t be saved.

5. Be cautious when borrowing from the government.

As is the case with any loan, the devil is in the details. The terms and covenants in the loan documents dictate what you can or can’t do with the money once you get it. You can only use the funds for the purposes you stated in your application — that is, to pay operating expenses of the business to keep it afloat until it starts bringing in sufficient revenue again. You (and your spouse) will probably have sign for the loan personally, and will probably have to pledge all available collateral, including a second (or third) mortgage on your house. If you maxed out your personal credit cards while anticipating your disaster relief funding, you can’t use the money to pay off your cards.

Practice point: Read the terms and covenants of the loan closely. Whatever the loan terms say to do, do, and whatever they say don’t do, don’t do. No exceptions.

6. We can’t save our businesses and our lifestyles at the same time.

Here’s the big trap. We have mortgages, car payments, school tuitions, and other personal expenses that have to be paid, and soon. But simply put, SBA loans are meant to save your business, not your lifestyle. Discuss all your options with advisors and friends you trust  — ones that will tell you the truth! It’s like going to the doctor. Your diagnosis will only be as accurate as the history you provide.  These are trying times, with a triage system designed to be more expeditious than thorough.

Practice point: There is no such thing as a free lunch. Borrowing money comes with responsibility and accountability.

7. Get acquainted with acceptance.

I hope we are all great entrepreneurs who can figure out ways to make our businesses survive and flourish. But let’s face it. Some of our businesses will not make it, even with the infusion of government funds. What should we do? We can pare down, embrace change and do things differently as we start a new chapter. Never forget that there will always be opportunity to start again, and to live a fuller, more abundant life.

Practice point: Sometimes less is way, way more!

Reprinted from Entrepreneur.com, link here.

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More on SBA PPP & EIDL Loan Fraud:

The Philadelphia Inquirer: Steal Money from the Feds? First, Meet Jeff Grant, an Ex-Con who Committed Loan Fraud, by Erin Arvedlund: Link to article here.

Fraud Stories Podcast with Mark Lurie: SBA/PPP Loan Fraud with Guest: Jeff Grant. Link to podcast here.

Forbes: As Law Enforcement Pursues SBA Loan Fraud, Jeff Grant Talks Redemption, by Kelly Phillips Erb. Link to article here.

Taxgirl Podcast: Jeff Grant talks Desperation and Loans in a Time of Crisis with Kelly Phillips Erb on Her Podcast. Link to article and podcast here.

Business Talk with Jim Campbell: Jeff Grant Talks with Jim About Going to Prison for SBA Loan Fraud and What to Know When Taking Coronavirus Relief Money, Biz Talk Radio Network, Broadcast from 1490 AM WGCH Greenwich, CT. Listen on YouTube here.

Babz Rawls Ivy Show: Babz Rawls Ivy & Jeff Grant Talk SBA / PPP Loan Fraud and 7 Things to Know Before You Take Coronavirus Relief Money, WNHH 103.5 FM New Haven. Watch on YouTube here.

Also: White Collar Week with Jeff Grant, Podcast Episode 09: Small Business Edition, with Guest Kelly Phillips Erb. Link here.

Radio/Podcast: Business Talk with Jim Campbell: Jeff Grant Talks with Jim About Going to Prison for SBA Loan Fraud and What to Know Before Taking Coronavirus Relief Money, Biz Talk National Radio Network, Broadcast from 1490 AM WGCH Greenwich, CT, Mon., Apr. 27, 2020. Listen on YouTube here.

Video/Podcast: Jeff & Babz Talk SBA Loan Fraud and 7 Things to Know Before You Take Coronavirus Relief Money, WNHH 103.5 FM New Haven, CT, Fri., April 24, 2020. Watch on YouTube here.


Radio/Podcast: Business Talk with Jim Campbell: Jeff Grant Talks with Jim About Going to Prison for SBA Loan Fraud and What to Know Before Taking Coronavirus Relief Money, 1490 AM WGCH Greenwich, CT, Mon., Apr. 27, 2020, 6 pm ET

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“Business Talk with Jim Campbell” – syndicated nationally on the BizTalkRadio.com Network with over 300 affiliate stations,  and “Forensic Talk with Jim Campbell” Monday April 27th 6 – 7 pm on 1490 AM WGCH Greenwich, WGCH.com. 1490 AM WGCH Greenwich, CT. Show features leaders in the worlds of business, politics and sports. For weekly email blast on show guests, send email to: jamesocampbell@CampbellBizTalk.com

Read Jeff Grant’s article, “I Went to Prison for SBA Loan Fraud: 7 Things You Should Know Before Taking Coronavirus Relief Money,” here

Listen on YouTube:

 

 

Jeff Grant, J.D., M.Div. is an ordained minister with over three decades of experience in crisis management, business, law, reentry, recovery (clean & sober 17+ years), and executive & religious leadership. Sometimes referred to in the press as “The Minister to Hedge Funders,” he uses his experience and background to guide people faithfully forward in their lives, relationships, careers and business opportunities, and to help them to stop making the kinds of decisions that previously resulted in loss, suffering and shame.

After an addiction to prescription opioids and serving almost fourteen months in a Federal prison for a white-collar crime he committed when he was a lawyer, Jeff started his own reentry – earning a Master of Divinity from Union Theological Seminary in the City of New York with a focus in Christian Social Ethics.  He is Co-Founder of Progressive Prison Ministries, Inc., the world’s first ministry serving the white collar justice/economy exiled community. It hosts a White Collar Support Group online on Zoom on Monday evenings, 7 pm ET, 6 pm CT, 5 pm MT, 4 pm PT. The group marked its milestone 200th weekly online meeting on Mon., April 13th. Jeff can be reached at prisonist.org,  jgrant@prisonist.org.

 

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More on SBA PPP & EIDL Loan Fraud:

Entrepreneur: I Went to Prison for SBA Loan Fraud: 7 Things You Should Know when Taking Covid-19 Disaster Relief Money, by Jeff Grant, Link to article here.

The Philadelphia Inquirer: Steal Money from the Feds? First, Meet Jeff Grant, an Ex-Con who Committed Loan Fraud, by Erin Arvedlund: Link to article here.

Fraud Stories Podcast with Mark Lurie: SBA/PPP Loan Fraud with Guest: Jeff Grant. Link to podcast here.

Forbes: As Law Enforcement Pursues SBA Loan Fraud, Jeff Grant Talks Redemption, by Kelly Phillips Erb. Link to article here.

Taxgirl Podcast: Jeff Grant talks Desperation and Loans in a Time of Crisis with Kelly Phillips Erb on Her Podcast. Link to article and podcast here.

Business Talk with Jim Campbell: Jeff Grant Talks with Jim About Going to Prison for SBA Loan Fraud and What to Know When Taking Coronavirus Relief Money, Biz Talk Radio Network, Broadcast from 1490 AM WGCH Greenwich, CT. Listen on YouTube here.

Babz Rawls Ivy Show: Babz Rawls Ivy & Jeff Grant Talk SBA / PPP Loan Fraud and 7 Things to Know Before You Take Coronavirus Relief Money, WNHH 103.5 FM New Haven. Watch on YouTube here.

Also: White Collar Week with Jeff Grant, Podcast Episode 09: Small Business Edition, with Guest Kelly Phillips Erb. Link here.

 

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Blessings, לשלום

Jeff

Rev. Jeff Grant, J.D., M.Div. (he, him, his)
Co-founder, Progressive Prison Ministries, Inc., Greenwich CT & Nationwide
Co-host, The Criminal Justice Insider Podcast
Host, White Collar Week
Mailing: P.O. Box 1, Woodbury, CT 06798
Website: http://prisonist.org
Email: jgrant@prisonist.org
Office: 203-405-6249
Donations (501c3): http://bit.ly/donate35T9kMZ
Psychology Today: https://www.psychologytoday.com/us/therapists/jeff-grant-woodbury-ct/731344
LinkedIn: https://www.linkedin.com/in/revjeffgrant
not a prison coach, not a prison consultant

 

Video/Podcast: Jeff Grant & Babz Rawls Ivy Talk SBA Loan Fraud and 7 Things to Know Before You Take Coronavirus Relief Money, WNHH 103.5 FM New Haven, Fri., April 24, 2020

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Babz Rawls Ivy & Jeff Grant on Lovebabz LoveTalk, WNHH 103.5 FM New Haven, talk about Jeff’s article: I Went to Prison for S.B.A. Loan Fraud: 7 Things to Know Before You Take Coronavirus Disaster Relief Money: by Jeff Grant, J.D., M.Div.

 

Watch on YouTube:

 

Listen on SoundCloud:

Entrepreneur: I Went to Prison for S.B.A. Loan Fraud: 7 Things to Know When Taking COVID-19 Relief Money: by Jeff Grant, J.D., M.Div.

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Don’t let desperation cloud your judgment.

Opinions expressed by Entrepreneur contributors are their own.

____________________

In the months after 9/11, I was frantic.

But my fears had less to do with the tragedy at the Word Trade Center and more to do with the fact that, after 10 years of rampant prescription opioid abuse, my business was failing. I was searching desperately for an out. Meanwhile, the television and radio were blaring with ads for 9/11 FEMA loans administered by the U.S. Small Business Administration.

So, on an especially bad day, I lied.

I said I had an office near ground zero. I received the SBA loan I requested, and immediately paid down the personal credit cards I had run up while waiting for the SBA money. Even so, the loan did little to stop my spiral into drug addiction, mental health issues, marital problems and magical thinking.

In 2002, I resigned my law license and started on the road to recovery. But it all caught up with me about 20 months later, when I was arrested for the misrepresentations on my loan application. I served almost 14 months at a Federal prison for wire fraud and money laundering.

My objective in writing this piece is to offer some insight on what business owners should consider before they take out disaster loans. Certainly, the majority of people requesting these loans are honest and upstanding entrepreneurs who have immense need for the aid, and will use the funds properly. I am very glad there is help for them. That said, history has shown us again and again that when people are in dire need, they’re more prone to make impulsive, ill-advised decisions. My hope is that sharing my experience will help others avoid the consequences I faced. Here are seven takeaways.

1. Desperate people do desperate things.

There were thousands of fraud prosecutions after 9/11, Hurricane Katrina, Superstorm Sandy, and so on. Why? Whether because of overwhelming business issues, poor personal judgment, or just plain bad luck, people were wounded, desperate and willing to do anything, anything, to stop the bleeding. But if the wound is too deep, a Band-aid is not sufficient. 

Practice point: In any situation, behaving desperately is unlikely to save your business.

2. Beware of the belief that rules are suspended in times of emergency.

The government is advertising that huge amounts of money are available to save our businesses. I recently sat in on a webinar run by a very reputable business consulting group that recommended that attendees get their SBA disaster loan applications in immediately, regardless of the facts or the actual needs of their business — they said we could always modify our applications prior to taking the money. State unemployment websites are actually giving instructions, in writing, on how to mislead and circumvent the system in order to get approved. Don’t take the bait! If you default two years from now, this “good-meaning advice” won’t matter to prosecutors. 

Practice point: Be truthful at all times.

3. Beware of magical thinking.

This is a tough one because entrepreneurs are inherently optimistic. We believe that things will always be better tomorrow than they are today. It drives us, makes us successful, informs our risk-taking. But in times of trauma, that voice can be an entrepreneur’s worst enemy. Does this sound familiar? We have learned the hard way that there is no shortcut, and yet we desperately want there to be one right now.  

Practice point: Instead of immediately reaching for a bailout or other quick fix, develop a good solid business plan. Maybe a disaster loan will fit into this plan; maybe it won’t.

4. This paradigm shift will affect all small to mid-size businesses.

We are in the midst of a massive reordering that has already had a huge effect on small and mid-sized businesses. Business owners are being called to closely examine if our business models are still viable, or if we must pivot to new ways of doing things. Example: the Swiss watch industry completely missed the shift to digital watches. Have we waited too long to have a robust online presence? Are our products or services even needed anymore? Have we been holding on by a thread for years, unwilling or unable to look at the hard facts? 

Practice point: Get real, now. Don’t borrow money to save a business that can’t be saved.

5. Be cautious when borrowing from the government.

As is the case with any loan, the devil is in the details. The terms and covenants in the loan documents dictate what you can or can’t do with the money once you get it. You can only use the funds for the purposes you stated in your application — that is, to pay operating expenses of the business to keep it afloat until it starts bringing in sufficient revenue again. You (and your spouse) will probably have sign for the loan personally, and will probably have to pledge all available collateral, including a second (or third) mortgage on your house. If you maxed out your personal credit cards while anticipating your disaster relief funding, you can’t use the money to pay off your cards. 

Practice point: Read the terms and covenants of the loan closely. Whatever the loan terms say to do, do, and whatever they say don’t do, don’t do. No exceptions.

6. We can’t save our businesses and our lifestyles at the same time.

Here’s the big trap. We have mortgages, car payments, school tuitions, and other personal expenses that have to be paid, and soon. But simply put, SBA loans are meant to save your business, not your lifestyle. Discuss all your options with advisors and friends you trust  — ones that will tell you the truth! It’s like going to the doctor. Your diagnosis will only be as accurate as the history you provide.  These are trying times, with a triage system designed to be more expeditious than thorough. 

Practice point: There is no such thing as a free lunch. Borrowing money comes with responsibility and accountability.

7. Get acquainted with acceptance.

I hope we are all great entrepreneurs who can figure out ways to make our businesses survive and flourish. But let’s face it. Some of our businesses will not make it, even with the infusion of government funds. What should we do? We can pare down, embrace change and do things differently as we start a new chapter. Never forget that there will always be opportunity to start again, and to live a fuller, more abundant life. 

Practice point: Sometimes less is way, way more!

Reprinted from Entrepreneur.com, link here.

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More on SBA PPP & EIDL Loan Fraud:

The Philadelphia Inquirer: Steal Money from the Feds? First, Meet Jeff Grant, an Ex-Con who Committed Loan Fraud, by Erin Arvedlund: Link to article here.

Fraud Stories Podcast with Mark Lurie: SBA/PPP Loan Fraud with Guest: Jeff Grant. Link to podcast here.

Forbes: As Law Enforcement Pursues SBA Loan Fraud, Jeff Grant Talks Redemption, by Kelly Phillips Erb. Link to article here.

Taxgirl Podcast: Jeff Grant talks Desperation and Loans in a Time of Crisis with Kelly Phillips Erb on Her Podcast. Link to article and podcast here.

Business Talk with Jim Campbell: Jeff Grant Talks with Jim About Going to Prison for SBA Loan Fraud and What to Know When Taking Coronavirus Relief Money, Biz Talk Radio Network, Broadcast from 1490 AM WGCH Greenwich, CT. Listen on YouTube here.

Babz Rawls Ivy Show: Babz Rawls Ivy & Jeff Grant Talk SBA / PPP Loan Fraud and 7 Things to Know Before You Take Coronavirus Relief Money, WNHH 103.5 FM New Haven. Watch on YouTube here.

Also: White Collar Week with Jeff Grant, Podcast Episode 09: Small Business Edition, with Guest Kelly Phillips Erb. Link here.