A Saginaw management company affiliated with one of the nation's oldest auto dealerships will pay more than $1.5 million to resolve federal allegations that it improperly obtained pandemic-relief funds, prosecutors announced Friday.
The settlement, disclosed by the U.S. Department of Justice and the U.S. Attorney’s Office for the Eastern District of Michigan, requires Garber Management Group, Inc. to pay the settlement over claims that it violated the False Claims Act by making false statements to secure a Paycheck Protection Program loan for which it was not eligible.
The settlement resolves only the allegations and no determination of liability has been made, prosecutors said.
Congress created the Paycheck Protection Program in March 2020 to provide emergency relief to businesses affected by the COVID-19 pandemic. The loans, backed by the U.S. Small Business Administration, were forgivable if recipients met eligibility and spending requirements.
Federal officials alleged that when Garber Management obtained an $864,732 PPP loan in May 2020, it certified that it qualified as a small business even though, when combined with affiliated entities, it exceeded the program’s 500-employee limit. The government contended the company did not qualify for an exemption from affiliation rules because it lacked a required franchise identifier code.
The company cooperated with investigators, according to the U.S. Attorney’s Office. Garber did not immediately...
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