Enforcement Push Targeting COVID-19 PPP Loan Fraud Continues: Entities Agree to Pay $12M+ to Settle False Claims Act Charges

By the Constantine Cannon Whistleblower Team The emergency phase of COVID-19 might be over, but the government is still uncovering pandemic-related loan fraud as it continues to announce many enforcement actions. This week, the government announced two Paycheck Protection Program (PPP) loan fraud enforcement actions. One case was brought by a whistleblower and involved a Virginia-based non-profit. A separate case involved Massachusetts businessman Herbert G. Chambers, his entities, and one of...

Scamming the System: $10M+ Paid to Settle COVID-19 PPP Loan Fraud Allegations in 2 Cases Brought by Whistleblowers

In the deluge of recent enforcement actions battling COVID-19 fraud, the government announced that a wide range of companies fraudulently certified their loan eligibility and received Paycheck Protection Program (PPP) loans intended for qualifying small businesses seeking emergency relief under the Coronavirus Aid, Relief and Economic Security (CARES) Act. Just in the past few weeks, two separate companies, a concrete manufacturer and a health system, have agreed to pay over...

Vix Technology Inc. Pays $2M+ to Settle Allegations of COVID-19 PPP Loan Fraud

Whistleblowers have been instrumental in the surge of recent government actions against COVID-19 relief fraud. On March 19, the government announced that Vix Technology Inc. (“Vix”) will pay double damages of $2,144,114 to resolve allegations that the company fraudulently submitted their qualifications for, and received, a COVID-19 Paycheck Protection Program (PPP) loan from the U.S. Small Business Administration (SBA). Vix Technology caters to the public transit industry by providing intelligent...

Michigan Manufacturer Rosler USA Will Pay $2.2M+ to Settle COVID-19 PPP Loan Program Fraud Allegations

The Battle Creek, Michigan-based manufacturer, Rosler Metal Finishing USA LLC (AKA Rosler), agreed to pay more than $2.2 million to resolve allegations that it defrauded the COVID-19-era Paycheck Protection Program, which was initiated as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act in March 2020 and administered by the Small Business Administration (SBA). The PPP was meant to provide loans to qualifying small businesses to assist with...

COVID-19 Con: Connecticut Company Pays $2M+ to Settle False Claims Act Allegations Related to PPP Loan

Although the pandemic has ended, government enforcement against fraudsters who took advantage of emergency government assistance programs continues. On February 25, in a case brought by a whistleblower, the government announced that the Waterbury, Connecticut company, MacDermid Incorporated paid $2,226,623.62 to settle False Claims Act allegations that its subsidiary, Coventya Inc., falsely certified its eligibility to receive a Paycheck Protection Program loan (PPP) during the pandemic. MacDermid is known for...

California Law Firm Settle False Claims Act Allegations Regarding Misuse of PPP Loan

It has been a very busy week for the DOJ tackling COVID-19 fraud. On August 15, DOJ announced that The Bloom Firm, a California-based law firm, along with senior management members Lisa Bloom and Braden Pollock, reached a settlement over government allegations of violating the False Claims Act by misusing Paycheck Protection Program (PPP) loan funds. The PPP was established in March 2020 under the CARES Act to offer temporary...

COVID Frauds of the Week: DOJ Continues to Crack Down on PPP Fraudsters

As of this week, the Small Business Administration has disbursed over $700 billion in Paycheck Protection Program (PPP) loans to small businesses and non-profits. There are over $100 billion in remaining appropriations, with additional appropriations likely to follow thereafter. With numbers like these, the program has become a magnet for fraudsters seeking to profit from the pandemic. The DOJ has been actively going after PPP fraud; here’s a summary of...

COVID Frauds of the Week: PPP, Puppies, and Securities Fraud

As COVID-19 cases continue to rise across the country, the government has remained vigilant in rooting out fraudsters who seek to capitalize on the crisis to line their own pockets.  Over the past week, federal prosecutors have advanced cases against multiple individuals who fraudulently obtained government funds that were supposed to help struggling small businesses.  And in another colorful case, DOJ busted a “puppy scam” targeting U.S. consumers.  Meanwhile, the...

COVID Frauds of the Week: PPP Loans for Fraudsters Who Like Nice Things

It was another busy week for the DOJ, with at least 13 individuals charged for their attempts to defraud the Paycheck Protection Program out of cash meant to help real businesses with real employees, rather than to fund fraudsters’ extravagant lifestyles and idiotic, selfish behavior. Aditya Raj Sharma, 47, of Maple Grove, Minnesota—fake entrepreneur and apparent fan of swimming—was arrested and charged with wire fraud, for defrauding the Paycheck Protection...

COVID Frauds of the Week: Fraudulently Claiming PPP Loans

This week, DOJ took action against two large alleged frauds on the Paycheck Protection Program.  In Hawaii and North Carolina, individuals were charged with fraudulently claiming loans from the critical relief program. In North Carolina, Tristan Pan found himself charged with wire and bank fraud, plus unlawful monetary transactions, for an alleged scheme to get bogus PPP loans.  He allegedly cooked up a series of applications for entities like “Khaleesi”...