Businesses with over 500 employees allegedly misrepresented eligibility to obtain COVID-19 relief loans; whistleblower awarded over $140,000 in federal settlement.
Five car-related companies based in Bucks County, Pennsylvania, have agreed to pay $1,427,869 to settle allegations that they illegally obtained and retained Paycheck Protection Program (PPP) loans, Acting U.S. Attorney and Special Attorney Alina Habba announced from Newark, New Jersey.
According to the complaint and settlement agreement, the companies—Fred Beans Holdings, Inc.; Auto Express Enterprises, Inc.; Autorent of Doylestown Inc.; McCafferty Autorent Inc.; and Noble Advertising, Inc.—were each approved for approximately $973,395 in PPP loans in April 2020.
The program, created under the CARES Act to support businesses during the COVID-19 pandemic, restricted eligibility to companies with 500 or fewer employees, including their affiliates.
Despite this rule, the companies certified eligibility and received the loans, even though their total combined workforce exceeded the employee threshold. Each defendant also applied for and received full loan forgiveness, including accrued interest.
Under the terms of the False Claims Act settlement, the companies will pay back more than $1.4 million to the federal government.
The case was originally filed as a qui tam (whistleblower) action by a private individual under the name United States ex rel. Forsyth v. Fred Beans Holdings, Inc.,...
Businesses with over 500 employees allegedly misrepresented eligibility to obtain COVID-19 relief loans; whistleblower awarded over $140,000 in federal settlement. Five car-related companies based ...