BOSTON — An allegation by an outside whistleblower led to a Southwick company agreeing to pay more than $2 million to resolve allegations that it violated the False Claim Act by receiving a Paycheck Protection Program loan for which it was not eligible, according to a release from U.S. Attorney Leah B. Foley.
Located on Feeding Hills Road, Hitachi Kokusai Electric Comark, LLC, which reverted to its original name as Kokusai Denki Electric America, Inc. in December 2024, agreed to pay $2,092,371 for violating the act, according to the release.
At the time of the violations, Comark was a wholly owned subsidiary of Hitachi Kokusai Electric, Inc., a company based in Tokyo.
According to the settlement agreement between all the parties involved, in April 2025, Daniel Foster filed a qui tam action in U.S. District Court in Boston alleging that Comark violated the False Claims Act because when it applied and was approved for a “Second Draw PPP loan,” it indicated it had only 67 employees but didn’t include employees at affiliate companies, which was under the 300 employee threshold.
A “qui tam action” is a type of whistleblower lawsuit where a private citizen sues on behalf of the federal government, which was confirmed by Foster’s attorney Gregg Shapiro.
“He’s not [an employee of the company],” Shapiro said Monday.
He said Foster researches companies that received PPP loans but were not eligible.
With the success of Foster’s action, he is eligible for 10% of the settlement, which...
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