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Entrepreneur: 9 Things to Know when Hiring a White Collar Criminal Defense Lawyer, by Jeff Grant, Esq.

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Hiring a defense attorney is a monumental task, and most are monumentally unprepared for the effort.

_________________________

By Jeff Grant, Reprinted from entrepreneur.com, Sept. 7. 2021

Hiring a white-collar defense lawyer is a monumental task — and one that most entrepreneurs and businesspeople, even those who are sophisticated legal consumers, are monumentally unprepared to do.

I should know.

I’m a lawyer and entrepreneur who became addicted to prescription opioids and served almost 14 months in federal prison for a white-collar crime.

I was disbarred, and then step-by-step, lesson-by-lesson, I worked my way through the ordeal.

On May 5, 2021, my law license was reinstated by the Supreme Court of the State of New York. Here are some takeaways I learned from over three decades of experience on both sides of the legal system:


1. You are in trauma, whether you know it or not


Your entrepreneurship, intellect and survival skills have betrayed you. You are in pain, and will do — and pay — almost anything to make the pain go away. You’ve probably been looking over your shoulder for a long time. It’s normal to be terrified; who wouldn’t be?


Practice point: no matter what you do, the pain is not going away any time soon. Beware of anyone who tells you differently.


2. Long-term plan instead of short-term relief


You know this, but you are probably in fear of what you think is the worst thing that can happen — prison. Prison is not the worst thing that can happen—the worst thing that can happen is not having a comeback story. Keep your eye on the prize. That is, a carefully and thoughtfully constructed long-term plan for health, purpose and prosperity for you and your family. It’s okay (in fact, it’s vital) to give yourself the time and space to step back and make good, thoughtful decisions. You are in the desert, and it will be a long journey to the promised land.


Practice point: This is a marathon, not a sprint. Pace yourself.


3. Your brother-in-law probably knows nothing about hiring a white collar defense lawyer…


…Neither does your dentist, haircutter or almost anyone else. Everyone around you is most likely offering “well-intended advice.” And maybe already picking at your bones. But, there is dependable professional help out there in the form of private general counsel with specific experience in the intricacies of white collar defense and all of the other legal, business, family and emotional issues you are likely to face.


Practice point: These are shark- infested waters and a great general counsel can help you navigate them.


4. There is very little chance that your case will go to trial


Over the past two decades, less than two percent of white collar prosecutions have gone to trial. This means that whether a “trial lawyer” has spent much of the last twenty years as a prosecutor or as a criminal defense attorney, they probably have no (or very little) white collar trial experience. But, we are stuck in an old paradigm where we think we need a trial attorney to swoop in and save the day. This might happen on television, but it almost never happens in real life.


Practice point: Are you suffering from Perry Mason syndrome? Get real, and fast.


5. Ever wonder why lawyers have such fancy offices?


Do you want to pay for expensive overhead (maybe you do) or for excellent lawyering? Isn’t it more important to find out if you and an attorney have a great connection, and can work together? Has your defense attorney taken the time to really understand you and your family, your back story, all of your issues, and your life goals?


Practice point: Are you sure these are the professionals you want to trust with your life?


6. Your criminal defense budget


Your criminal defense lawyer can’t do it all; you’ll need a team. Your defense attorney’s job is to marshal the best resources in order to make a persuasive presentation to the prosecutors, to the probation officer at your pre-sentence investigation, and to the judge.  How much of your criminal defense budget/retainer will be allocated for experts (forensic accountants, investigators, mitigation experts, medical experts, etc.) to give a complete and accurate picture of you, your family and your side of the facts?


Practice point: Make sure you fully understand — and approve — the plan and budget up front.


7. Outside your criminal defense budget


Your issues are most likely way bigger, and more complicated, than just your criminal matter. How much of your overall budget will be allocated for other attorneys and professionals (business attorneys, tax attorneys, bankruptcy lawyers, family law, civil litigation, estate planning, accountants, etc.)? How much of your overall budget will be allocated for other obligations (restitution, fines, forfeiture, taxes, antecedent debt, alimony, child support, etc.)?


Practice point: Your defense attorney’s job is to get you the best sentence — they will probably not help you balance other important issues that need to be addressed. 


8. Does your spouse/significant other need separate counsel?


In a word, yes. Or at least, probably. You’ve been shouldering this thing alone for so long, it’s hard to be a good partner again. Believe it or not, your spouse’s interests are probably not fully aligned with yours. They have their own body of rights that deserve professional attention.


Practice point: Tell the truth, don’t tell your spouse/significant other that everything will be “okay.”


9. Out of isolation and into community


You don’t have to go through this alone. Believe it or not, there is a rich community of people who have been prosecuted for white collar crimes, and their families, who want to give of themselves freely to help you.


Practice point: Don’t be afraid to reach out, join a white collar support group and benefit from the experiences of those who have been there before you.


Jeffrey D. Grant, Esq.

GrantLaw, PLLC, 43 West 43rd Street, Suite 108, New York, NY 10036-7424

(212) 859-3512, [email protected], GrantLaw.com

A purpose-driven attorney.

Jeff Grant is on a mission. After a hiatus from practicing law, he is once again in private practice and is committed to using his legal expertise and life experience to benefit others.

Jeff provides a broad range of legal services in a highly attentive, personalized manner. These include private general counsel, white collar crisis management, strategy and team building, services to family-owned and closely-held businesses, and support to special situation and pro bono clients. He practices in New York and on authorized Federal matters, and works with local co-counsel and criminal defense counsel to represent clients throughout country.

For more than 20 years, Jeff served as managing attorney of a 20+ employee law firm headquartered in New York City and then Westchester County, New York. The firm’s practice areas included representing family-owned and closely-held businesses and their owners, business and real estate transactions, trusts and estates, and litigation.

Jeff is admitted to practice law in the State of New York, and in the Federal District Courts for the Southern District of New York and the Eastern District of New York. He is a member of the American Bar Association, the New York State Bar Association, the New York City Bar Association, and the National Association of Criminal Defense Lawyers.

 

Jeff Grant’s full bio: https://grantlaw.com/bio

Progressive Prison Ministries website: https://prisonist.org

Linked In: https://linkedin.com/revjeffgrant

 

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Entrepreneur: 3 Important Takeaways for Hiring Job-Seekers with Criminal Records, by Jeff Grant, Esq.

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Jeff Grant is a member of our White Collar Support Group that meets online on Zoom on Monday evenings.

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Dear Friends,

I am pleased to share with you that an article that I authored titled 3 Important Takeaways for Hiring Job-Seekers with Criminal Records was recently published in Entrepreneur (see below).

As you know, overcoming the stigma and discrimination associated with having a conviction history is very near and dear to me, and I am personally invested in helping as many of the 70 million Americans like myself with conviction records secure the professional, educational, housing and other life opportunities we all need to thrive. The reality is that even long after serving our sentences, we are routinely denied gainful employment and thus the ability to meaningfully rebuild our lives. This article speaks to the immense scope of this issue and offers a simple, concrete solution on how we can begin to address it – by providing individuals who have completed their sentences with a clean slate.

A few months ago, I had the privilege of joining the Board of Directors of an organization called the Legal Action Center (LAC). For nearly 50 years, LAC has utilized a range of legal and policy strategies to fight discrimination, restore opportunities, and build health equity for individuals with arrest and conviction records, substance use disorders, and/or HIV/AIDS. Their proven track record of and ongoing commitment to helping tens of thousands of individuals overcome discriminatory barriers so they can support themselves, their families, and contribute to our shared communities is truly inspiring, and I am honored to partner with them in this critical work. The clean slate solution I mentioned above is just one of the many initiatives LAC is working hard to advance.

I cannot stress how important the efforts of organizations like LAC are to individuals like me – and our society at large. I do hope you’ll take a few moments to make a donation to support their mission – a gift of any size can help!

Thank you so much for taking the time to read this message, and please do not hesitate to reach out with any questions you might have.

With deep gratitude,

Jeff

Donate to The Legal Action Center here…

_________________________

Reprinted from Entrepreneur.com, May 24, 2022

There are more than 70 million people in our country who have a conviction record. That translates to roughly one in every three Americans. The obstacles that those of us with records face are enormous. You would think that after we have completed our sentences, we should be able to move forward with our lives.

But the reality is that we face a multitude of often lifelong barriers that block us from essentials like steady jobs, educational opportunities, professional licenses, safe homes and more. In fact, the National Institute of Justice estimates 44,000 such barriers. These can severely limit or completely impede the ability of a person with a conviction history. They can’t effectively function in society and participate meaningfully in civic, economic and community life.

First takeaway: People with past convictions face an array of barriers to gainful employment

Due to widespread discrimination and stigma, individuals with conviction records are routinely blocked from employment opportunities. Even after having long ago completed their sentences. Whether a former CEO or trade worker, once an individual is branded with the scarlet letter of a conviction, it doesn’t matter who they were before. Many employers will quickly toss applications from formerly incarcerated individuals aside. The same for potential investors who will deny meetings with entrepreneurs who have records of conviction. 

Predictably, the resulting economic insecurity, pain, shame and despair can be devastating. Not just for us as individuals, but for our families as well. People at every level of the workforce are impacted. But, systemic inequities and racially biased policing and prosecution in our country have yielded disproportionate rates of arrest, incarceration and conviction among low-income communities of color nationwide.

Second takeaway: There is a simple solution — provide people with a clean slate

Across the country, states are working to pass legislation that ensures individuals like me who have completed their sentences can have our records automatically cleared. There are many states where application-based sealing is currently an option. But this process is often incredibly burdensome and costly. Therefore preventing a significant number of people who would be eligible from actually having their records cleared. Efforts to automatically clear people’s records, also known as clean slate, help make it possible for all eligible individuals to start fresh. And, without having to navigate bureaucratic hurdles or spend money they don’t have. 

When people have served their time and paid their debt to society, we deserve a second chance. A clean slate, erasure of the paralyzing, proverbial scarlet letter. Through automatic records clearance, this second chance can be fully realized — stable jobs, trade licenses, business ventures and secure homes would all once again be within our reach. Clean slate can give us the opportunity to truly move forward with our lives. 

Third takeaway: Clean slate can help us all

Clean slate can give me and others with past conviction records a real chance at healing, justice and meaningful participation in the economy and communities we all share. It can also improve the well-being of entire families and communities. Individuals who want to work hard, support their families and contribute to their neighborhoods and local communities should be able to do so. We all know that children who grow up in poverty are far more likely to remain living in poverty throughout their lives — a brutal cycle known as intergenerational poverty.

Clean slate policies can help break this cycle. Furthermore, the benefit of clean slate policies for our economy at large cannot be overstated. The ACLU estimates that, nationally, excluding individuals with conviction histories from the workforce costs the economy between $78 billion and $87 billion in lost domestic product every year. With clean slate, employers looking to grow their businesses could tap into a huge pool of skilled workers. Without clean slate, we risk indefinitely locking away vast amounts of human potential. Amidst rising labor shortages, the great need for untapped talent is only increasing. Last, but certainly not least, clean slate can help begin to remedy the racial injustice pervading our country by breaking down the unjust barriers. Those that keep far too many Black and Brown Americans from reaching their full potential.

From social justice activists to Fortune 500 companies, clean slate has a diverse and wide array of supporters who believe in its immense potential. In New York, for example, the clean slate campaign has garnered support from top labor unions and business leaders like JPMorgan Chase. Also, faith leaders, survivors of crime, civil rights groups, law firms and health advocates. They all understand that not only is giving people a second chance the right thing to do, it is the smart thing to do. As they say, a rising tide raises all ships. 

Jeff Grant serves as a private General Counsel and white collar attorney in New York, on authorized Federal matters, and as co-counsel with lawyers throughout the country. Reach him at GrantLaw.com.

Entrepreneur: 9 Things to Know when Hiring a White Collar Criminal Defense Lawyer, by Jeff Grant, Esq., Sept. 7, 2021

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Hiring a defense attorney is a monumental task, and most are monumentally unprepared for the effort.

_________________________

By Jeff Grant, Reprinted from entrepreneur.com, Sept. 7. 2021

Hiring a white-collar defense lawyer is a monumental task — and one that most entrepreneurs and businesspeople, even those who are sophisticated legal consumers, are monumentally unprepared to do.

I should know.

I’m a lawyer and entrepreneur who became addicted to prescription opioids and served almost 14 months in federal prison for a white-collar crime.

I was disbarred, and then step-by-step, lesson-by-lesson, I worked my way through the ordeal.

On May 5, 2021, my law license was reinstated by the Supreme Court of the State of New York. Here are some takeaways I learned from over three decades of experience on both sides of the legal system:    

1. You are in trauma, whether you know it or not

Your entrepreneurship, intellect and survival skills have betrayed you. You are in pain, and will do — and pay — almost anything to make the pain go away. You’ve probably been looking over your shoulder for a long time. It’s normal to be terrified; who wouldn’t be?

Practice point: no matter what you do, the pain is not going away any time soon. Beware of anyone who tells you differently.

 

2. Long-term plan instead of short-term relief

You know this, but you are probably in fear of what you think is the worst thing that can happen — prison. Prison is not the worst thing that can happen—the worst thing that can happen is not having a comeback story. Keep your eye on the prize. That is, a carefully and thoughtfully constructed long-term plan for health, purpose and prosperity for you and your family. It’s okay (in fact, it’s vital) to give yourself the time and space to step back and make good, thoughtful decisions. You are in the desert, and it will be a long journey to the promised land.

Practice point: This is a marathon, not a sprint. Pace yourself.

 

3. Your brother-in-law probably knows nothing about hiring a white collar defense lawyer…

…Neither does your dentist, haircutter or almost anyone else. Everyone around you is most likely offering “well-intended advice.” And maybe already picking at your bones. But, there is dependable professional help out there in the form of private general counsel with specific experience in the intricacies of white collar defense and all of the other legal, business, family and emotional issues you are likely to face.

Practice point: These are shark- infested waters and a great general counsel can help you navigate them.

 

4. There is very little chance that your case will go to trial

Over the past two decades, less than two percent of white collar prosecutions have gone to trial. This means that whether a “trial lawyer” has spent much of the last twenty years as a prosecutor or as a criminal defense attorney, they probably have no (or very little) white collar trial experience. But, we are stuck in an old paradigm where we think we need a trial attorney to swoop in and save the day. This might happen on television, but it almost never happens in real life.

Practice point: Are you suffering from Perry Mason syndrome? Get real, and fast.

 

5. Ever wonder why lawyers have such fancy offices?

Do you want to pay for expensive overhead (maybe you do) or for excellent lawyering? Isn’t it more important to find out if you and an attorney have a great connection, and can work together? Has your defense attorney taken the time to really understand you and your family, your back story, all of your issues, and your life goals?

Practice point: Are you sure these are the professionals you want to trust with your life?

 

6. Your criminal defense budget

Your criminal defense lawyer can’t do it all; you’ll need a team. Your defense attorney’s job is to marshal the best resources in order to make a persuasive presentation to the prosecutors, to the probation officer at your pre-sentence investigation, and to the judge.  How much of your criminal defense budget/retainer will be allocated for experts (forensic accountants, investigators, mitigation experts, medical experts, etc.) to give a complete and accurate picture of you, your family and your side of the facts?

Practice point: Make sure you fully understand — and approve — the plan and budget up front.

 

7. Outside your criminal defense budget

Your issues are most likely way bigger, and more complicated, than just your criminal matter. How much of your overall budget will be allocated for other attorneys and professionals (business attorneys, tax attorneys, bankruptcy lawyers, family law, civil litigation, estate planning, accountants, etc.)? How much of your overall budget will be allocated for other obligations (restitution, fines, forfeiture, taxes, antecedent debt, alimony, child support, etc.)?

Practice point: Your defense attorney’s job is to get you the best sentence — they will probably not help you balance other important issues that need to be addressed. 

 

8. Does your spouse/significant other need separate counsel?

In a word, yes. Or at least, probably. You’ve been shouldering this thing alone for so long, it’s hard to be a good partner again. Believe it or not, your spouse’s interests are probably not fully aligned with yours. They have their own body of rights that deserve professional attention.

Practice point: Tell the truth, don’t tell your spouse/significant other that everything will be “okay.”

 

9. Out of isolation and into community

You don’t have to go through this alone. Believe it or not, there is a rich community of people who have been prosecuted for white collar crimes, and their families, who want to give of themselves freely to help you.

Practice point: Don’t be afraid to reach out, join a white collar support group and benefit from the experiences of those who have been there before you.

 

 

Jeff Grant, Esq.

GrantLaw, PLLC, 43 West 43rd Street, Suite 108, New York, NY 10036-7424

(212) 859-3512, [email protected], GrantLaw.com

A purpose-driven attorney.

Jeff Grant is on a mission. After a hiatus from practicing law, he is once again in private practice and is committed to using his legal expertise and life experience to benefit others.

Jeff provides a broad range of legal services in a highly attentive, personalized manner. They include private general counsel, white collar crisis management to individuals and families, services to family-owned and closely-held businesses, plus support to special situation and pro bono clients.

For more than 20 years, Jeff served as managing attorney of a 20+ employee law firm headquartered in New York City and then Westchester County, New York. The firm’s practice areas included representing family-owned and closely-held businesses and their owners, business and real estate transactions, trusts and estates, and litigation.

Jeff Grant’s full bio: https://grantlaw.com/bio

Progressive Prison Ministries website: https://prisonist.org

Linked In: https://linkedin.com/revjeffgrant

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.

____________________

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.

____________________

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.


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.

, , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

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.