Pandemic Darlings The pandemic economy, in original documents
Home Profiles Betty Young

Profiles · Oversight

ProfilePerson

Betty Young

Oversight and enforcement

PPP
Type
Person
Role
Oversight and enforcement
Programs
PPP
Updated

The profile

Eastern District of Texas prosecutor on both halves of the Kabbage PPP False Claims Act file: the 2024 settlement with the bankrupt lender and the government's suit against three of its former executives.

Identity and role

Betty S. Young is an Assistant U.S. Attorney in the civil division of the U.S. Attorney's Office for the Eastern District of Texas. DOJ's May 13, 2024 release on the Kabbage settlement names her as the lawyer who handled the matter for that office, alongside Assistant U.S. Attorneys Brian M. LaMacchia and Diane Seol in the District of Massachusetts and Fraud Section Trial Attorney Sarah E. Loucks. DOJ's December 20, 2024 release on the follow-on suit against three former Kabbage executives names Loucks and Young as the lawyers handling that matter.

Paul Pietschner, a former analyst in Kabbage's collections department, brought his qui tam suit in the Eastern District of Texas on February 5, 2021 (No. 4:21-cv-110-SDJ, Sherman Division).

Biography / career arc

Our records on Young are her court filings. Those filings put her in the office's civil division from at least October 2022, when Kabbage's bankruptcy papers addressed her at the Beaumont office, and give the office's Tyler address on her signature blocks from December 2024 through September 2025. Her co-counsel in the Texas case is Assistant U.S. Attorney James G. Gillingham.

Pandemic-relief / PPP-EIDL role

Young's work on Kabbage runs through three proceedings.

The bankruptcy listing (October 2022). Kabbage, Inc. d/b/a KServicing filed for Chapter 11 in Delaware on October 3, 2022. Its list of creditors holding the 30 largest unsecured claims gives entry 4 to the Justice Department: a "Litigation" claim of "Undetermined" amount, with notice to the Civil Division's Fraud Section, the U.S. Attorney's Office in Massachusetts and, "Attn.: Betty Young, Esq.," the Eastern District of Texas civil division.

The settlement (May 2024). The Eastern District of Texas settlement agreement among the United States, the KServicing wind-down estates and Pietschner carries Young's digital signature dated May 7, 2024. It gives the United States an allowed general unsecured claim of $56,705,729.57, including $28,352,864.79 in restitution. DOJ's release describes two Kabbage settlements: one for up to $63.2 million over allegations that Kabbage systemically inflated loan amounts, and one for up to $56.7 million over allegations that Kabbage "knowingly failed to implement appropriate fraud controls." Together they give the government a claim of up to $120 million; what it recovers depends on the assets left in the estate. On June 12, 2024, the Texas court dismissed with prejudice the claims against Kabbage for the conduct the agreement covered.

The executives case (December 2024 onward). After the United States intervened against Kabbage co-founders Kathryn Petralia and Robert Frohwein and former head of strategy Spencer Robinson, the court unsealed the relator's complaint on August 27, 2024 and set a November 25, 2024 deadline for the government's own complaint. The United States' Complaint in Intervention was filed on December 20, 2024. Its signature block lists Gillingham and Young for the Texas office, with Civil Division attorneys Jamie A. Yavelberg, Colin M. Huntley, Sarah E. Loucks and Kelly E. Phipps. DOJ's release summarizes the claims: Kabbage approved more than $7 billion in PPP loans in 2020 and was paid more than $217 million in processing fees, and the defendants allegedly caused false claims on tens of thousands of loans that were inflated by calculation errors or approved without appropriate fraud controls.

Young signed the government's 125-page omnibus opposition to the defendants' four motions to dismiss on April 17, 2025, and its sur-reply on May 30, 2025. On April 24, 2025, she signed the government's opposition to the defendants' joint motion to stay discovery while those motions were pending; the filing called the defendants' personal-jurisdiction challenges "wholly without merit." Her signature also appears on the parties' joint motion for a protective order filed the same day, and on the stipulated privilege-log protocol filed on September 10, 2025.

Young is government counsel in these matters, not a party. The claims against Petralia, Frohwein and Robinson are allegations; DOJ's December 2024 release states that "there has been no determination of liability." No complaint, sanction or controversy involving Young appears in these records.

Where they are now (2025–2026)

The most recent filing in our copies that carries Young's signature is the September 10, 2025 privilege-log stipulation, filed for the United States under Deputy Assistant Attorney General Brenna E. Jenny and Acting U.S. Attorney Jay R. Combs. The case was still open on January 12, 2026, when the court let Frohwein's Goodwin Procter lawyers withdraw. No later role change is documented.

Sources held in this archive

Sources

Back to top