Whistleblower Lawsuit Exposes Alleged PPP Loan Fraud Leading to $400000 Settlement

The U.S. Department of Justice (DOJ)  announced a $399,990 settlement with Allstar Health Providers Inc. through Paycheck Protection Program (PPP) loan fraud, a California home health agency, and its owner, Maria Chua over allegations that they violated the False Claims Act (FCA).

Top 5 Common PPP Loan Fraud Schemes

As the reports confirm from DOJ, “Chua submitted two PPP loan applications on behalf of Allstar Health Providers in May 2020, and in both applications, she certified that the company would not receive more than one loan prior to Dec. 31, 2020.”

the government alleges, “Despite these certifications, the United States alleged that Allstar Health Providers received two PPP loans in 2020, and thereafter knowingly and improperly retained the second, duplicate loan.”

whistleblower lawsuit filed by J. Bryan Quesenberry, the settlement stems from a qui tam, The False Claims Act’s qui tam provisions enable private citizens and private parties to file lawsuits on behalf of the government if they know of an individual or company defrauding the government. The Qui tam whistleblowers are eligible to receive between 15 and 30% of the government’s recovery.

Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division said, “PPP loans were intended to provide critical relief to small businesses,” he added “The department is committed to pursuing those who knowingly violated the requirements of the PPP or other COVID-19 assistance programs and obtained relief funds to which they were not entitled.”

U.S. Attorney Martin Estrada for the Central District of California said, “When an individual violates the False Claims Act by fraudulently receiving and retaining PPP loans, taxpayers lose,” he added, “Those who violate the law by fraudulently receiving and retaining PPP loans will be held accountable.”

a bipartisan group of senators, In July 2023, introduced the False Claims Amendments Act of 2023, it address a few technical loopholes undermining the success of the FCA. The bill is widely supported by whistleblower advocates.

Action Alert calling on Congress to pass the bill has issued by National Whistleblower Center (NWC)