On September 9, 2021, President Biden announced a six-pronged plan to combat COVID-19, which Crowell previously discussed here. One prong of the plan is to protect the economy, an aspect of which is the streamlining of the existing Paycheck Protection Program (“PPP”) loan forgiveness process.
Under the PPP, loans to small businesses can be
On April 21, 2021, the Department of Justice (DOJ) inked its second civil settlement resolving allegations of fraud involving loans issued pursuant to the Paycheck Protection Program (PPP). Sandeep S. Walia, M.D., a Professional Medical Corporation (Walia PMC), and its owner, Dr. Walia, agreed to pay $70,000 in damages and penalties to resolve alleged violations of the False Claims Act (FCA) tied to allegations that Dr. Walia falsely certified in a second PPP loan application that his medical practice had not previously received a PPP loan after it had already received one from a different lender. Walia PMC also agreed to repay the second PPP loan for $430,000. This latest settlement is a continued reflection of the heightened scrutiny of the PPP, and suggests that the FCA may quickly become a favored enforcement tool by the government in its continued pursuit of PPP-related fraud.
Continue Reading Avoiding Loan Forgiveness Is No Shield from False Claims Act Liability in Latest Paycheck Protection Program Fraud Settlement
From the inception of the Paycheck Protection Program (PPP), borrowers questioned the meaning of the economic necessity certification that the Small Business Administration (SBA) required borrowers to make in the PPP loan application. While the SBA provided some definition to this certification in such Frequently Asked Questions as FAQs 31, 37, and 46, uncertainty remained.
In this episode, hosts Jacinta Alves and Mana Lombardo discuss the Paycheck Protection Program, which was established by the CARES Act, and FCA risks associated with receipt of those funds. “Let’s Talk FCA” is Crowell & Moring’s podcast covering the latest developments with the False Claims Act.
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