It was the Wild West. Honestly, there is no better way to describe the spring of 2020 when the Paycheck Protection Program (PPP) launched. The government was throwing money out of a helicopter to save a crashing economy, and as you’ve probably guessed, some people brought very large nets. Now, in 2026, the dust is still settling, but the scale of the theft is finally clear.
We are looking at a ppp loan frauds list by state that is both massive and, frankly, a bit depressing.
Federal investigators haven't stopped. In fact, they've accelerated. If you thought the statute of limitations was going to save the scammers, you're mistaken. In August 2022, the window for prosecution was quietly extended to a full 10 years. That means for someone who lied on an application in 2020, the feds have until 2030 to knock on their door.
Basically, the "harvest" has begun.
The heavy hitters: States with the most PPP fraud cases
You’d expect the biggest states to have the most trouble, and the data from the Pandemic Response Accountability Committee (PRAC) backs that up. California, Florida, and Texas are predictably at the top of the pile. But it’s not just about the number of people; it’s about the audacity of the schemes.
In California, the sheer volume is staggering. As of early 2026, the state has seen hundreds of indictments ranging from solo scammers to massive rings. One specific case involved a group that used stolen identities to snag over $20 million in loans meant for businesses that didn't exist. They bought luxury cars and designer handbags while actual mom-and-pop shops in Echo Park were closing their doors.
Florida is a close second. The "Sunshine State" became a hotspot for what investigators call "lifestyle fraud." You’ve seen the headlines—guys buying Lamborghinis with PPP money. It happened in Miami more than almost anywhere else. Federal prosecutors in the Southern District of Florida have been so busy they’ve had to pull in extra resources just to manage the docket.
The PPP loan frauds list by state (Key highlights)
- California: Over 160 major reports of fraud and thousands of suspicious loans flagged.
- Florida: 200+ major investigative results, with a heavy concentration in the Miami-Dade area.
- New York: 185+ major reports, specifically targeting "ghost companies" in the city.
- Illinois: High rates of fraud involving Chicago-area laboratory owners and medical scams.
- Georgia: A surprisingly high density of fraud in both Atlanta and rural counties like Mitchell County.
Why Georgia and Arizona are surprising the feds
You might not expect Arizona to be a leader in fraud, but it holds one of the records for the largest single schemes. The Karnezis brothers in Arizona pleaded guilty to a scam worth at least $109 million. They weren't just filing one bad application; they were a factory. They submitted thousands of fraudulent apps, many through fintech lenders like Blueacorn.
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Blueacorn itself became a name synonymous with "low-barrier" fraud. One of its co-founders, Stephanie Hockridge, was sentenced to 10 years in prison. The government found that the system was basically "set it and forget it" for scammers, allowing them to recycle identities and repetitive data to pull out millions.
Then there’s Georgia. In June 2025, the DOJ announced charges against over 200 individuals in a single sweep. It wasn't just big-city crime. In Mitchell County—a place with fewer than 25,000 people—a grand jury returned 13 separate indictments against 21 people. If they're prosecuting in rural Georgia, they're prosecuting everywhere.
The Fintech factor: A recipe for disaster
Let's be real: the banks weren't the main problem.
Traditional banks like JPMorgan Chase and Bank of America actually had lower-than-average rates of suspicious loans. The real chaos happened with Fintech lenders. According to a study from the University of Texas at Austin, Fintech loans were suspicious at almost five times the rate of traditional banks.
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Fintechs like Kabbage (which has since faced massive scrutiny) and Cross River Bank were built for speed. Speed is great for a baker trying to keep the lights on, but it’s even better for a fraudster with a fake EIN. These companies earned hundreds of millions in processing fees while, in some cases, ignoring obvious red flags—like 14 different businesses all registered to the same single-family home in suburban Chicago.
Notable cases that sound like movie plots
The ppp loan frauds list by state isn't just a bunch of numbers on a spreadsheet. It’s people like Zishan Alvi in Illinois, who ran a COVID-testing fraud worth $83 million. He was billing the government for tests that were never performed or were just plain wrong. He’s now serving seven years.
Or look at the Feeding Our Future case in Minnesota. While technically a child nutrition program scam, it was part of the same pandemic-era feeding frenzy. It cost taxpayers $250 million. The founder, Aimee Bock, was convicted because she allegedly oversaw a system where fake names were pulled from websites like "listofrandomnames.com" to claim they were feeding thousands of kids who didn't exist.
Where the money went
- Luxury Assets: Private jets, mansions in Puerto Rico, and $100,000 watches.
- Real Estate: People were buying homes for relatives using "consulting" fees paid from PPP funds.
- Crypto: A significant chunk of 2021 fraud money was laundered through various exchanges before being seized.
The 2026 reality: AI and Whistleblowers
How is the government catching people six years later? Two words: Data analytics.
The PRAC has developed sophisticated AI tools that cross-reference PPP applications with IRS records, Social Security data, and even state unemployment filings. If you claimed to have 20 employees on your PPP app but only paid payroll tax for 2, an alert pops up. It’s not a human looking for you anymore; it’s an algorithm that doesn't sleep.
Also, don't underestimate the "Relator"—the whistleblower. Under the False Claims Act, if a former employee or a disgruntled business partner reports PPP fraud, they get a cut of the recovered money. In 2025, one whistleblower received over $2.3 million for flagging a $13 million settlement. That’s a lot of incentive to tell on your old boss.
What to do if you're worried about an audit
If you're a business owner looking at this ppp loan frauds list by state and feeling a pit in your stomach, you need to understand the difference between a "mistake" and "fraud."
The feds are looking for intent. If you calculated your payroll slightly wrong, you might have to pay it back with interest. If you invented 10 employees and spent the money on a boat, you’re in the fraud category.
Next Steps for Borrowers:
- Audit your own files: Ensure your payroll records from 2020-2021 match exactly what you submitted for forgiveness.
- Check your "Affiliation" rules: Many recent civil settlements, like the one involving Semblex Corporation for $3 million in January 2026, happened because companies didn't count employees at their sister companies or foreign affiliates.
- Consult a specialist: If you realize there was a major error, proactive disclosure is almost always better than waiting for the DOJ to send a subpoena.
The government has made it clear: they aren't moving on. With billions still unrecovered and a statute of limitations that runs until 2030, the list of names is only going to get longer. Honestly, the best thing anyone can do now is ensure their documentation is airtight and ready for a look-over that might be years overdue.