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Stanton McManus

Oversight and enforcement

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Person
Role
Oversight and enforcement
Programs
PPP
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The profile

Justice Department bankruptcy lawyer for the United States in Kabbage's Chapter 11, where the government kept its False Claims Act options open while the PPP lender wound down.

Identity and role

Stanton McManus is a trial attorney in the Justice Department's Civil Division, Commercial Litigation Branch. DOJ's May 13, 2024 release on the Kabbage PPP settlement lists him with Alastair Gesmundo and Shane Huang as the Corporate/Financial Litigation Section trial attorneys who "represented the United States in the bankruptcy proceeding." His name is on the government's filings in In re Kabbage, Inc., No. 22-10951 (CTG) (Bankr. D. Del.), from January through May 2023, and on the court's sign-in sheets for three hearings between November 2022 and March 2023.

Biography / career arc

Our records on McManus are these filings and the May 2024 release. The government's signature blocks list him in the Commercial Litigation Branch in Washington, below Ruth A. Harvey, Rodney A. Morris and Alastair M. Gesmundo, under Principal Deputy Assistant Attorney General Brian M. Boynton and U.S. Attorney David C. Weiss. Gesmundo is the attorney who signed the filings.

Pandemic-relief / PPP-EIDL role

Kabbage, Inc. d/b/a KServicing filed for Chapter 11 on October 3, 2022, two years after selling the majority of its assets. The Kabbage name had become an American Express trademark, and the loan files sat on an AmEx platform. The government's problem was timing: it was still investigating Kabbage's PPP lending while the company asked the court to approve a liquidation plan. The filings McManus is listed on show how DOJ handled that.

  • November 29, 2022. He appeared for the United States at a video status conference on Customers Bank's dispute with KServicing over settlement payments.
  • January 6, 2023. The United States and the debtors stipulated to push the government's deadline to file a nondischargeability complaint from January 9 to May 9, 2023. The stipulation states that the United States "continues to investigate potential violations of the False Claims Act" by Kabbage, "a lender and loan servicer that participated in the Paycheck Protection Program." The court approved it on January 10.
  • January 11, 2023. The United States filed a reservation of rights and limited objection to the debtors' disclosure statement. It argued the statement was "silent on how Debtors will ensure that any third-party loan servicer will have access to AmEx-held loan documentation that is necessary to service the loans," and quoted the debtors' own admission that responses from the AmEx platform "are often delayed and incomplete."
  • February 28, 2023. The United States objected to the amended liquidation plan. It asked the court to deny confirmation unless the confirmation order carried plan section 10.3(f), so that the government could still pursue "any police and regulatory action," and it preserved its rights of setoff and recoupment.
  • March 13, 2023. He signed in for the United States at the confirmation hearing. The court confirmed the plan on March 15; the plan and confirmation order state that nothing in them grants the debtors a discharge.
  • May 8, 2023. A second stipulation moved the deadline to August 7, 2023, repeating that the False Claims Act investigation was continuing. The court entered the order on May 10.

The corporate side was resolved in May 2024. DOJ announced two settlements giving the United States an allowed general unsecured claim of up to $120 million in the bankruptcy, one over allegations that Kabbage systemically inflated loan amounts and one over its fraud controls. How much the government collects depends on the assets available to unsecured creditors.

McManus represented the government; he is not a party. In the 2024 settlement, KServicing Wind Down Corp. admitted and acknowledged that Kabbage double-counted state and local taxes paid by employees in calculating gross wages, failed to exclude annual compensation above $100,000 per employee, and miscalculated employer payments for leave and severance. The separate False Claims Act case against three former Kabbage executives, filed in the Eastern District of Texas in December 2024, is a set of allegations with no determination of liability. No complaint, sanction or controversy involving McManus appears in these records.

Where they are now (2025–2026)

The May 13, 2024 DOJ release is the latest record in our copies that names McManus. No later role is documented.

Sources held in this archive

Sources

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