Tellico Village Property Owners' Association Agrees To Pay $1.3M Following Receipt Of PPP Loan
Summary
Tellico Village Property Owners Association, Inc. (TVPOA) agreed to pay $1,361,992.22 to resolve allegations that it violated the False Claims Act by applying for, receiving and obtaining forgiveness of a PPP loan for which it was not eligible, according to a Knoxville release. The release says 501(c)(4) nonprofit organizations have never been eligible for PPP loans, that TVPOA is one, and that its April 2020 application selected C-Corp as its entity type. TVPOA cooperated fully and contends that any misstatements were inadvertent; the settlement amount reflects that cooperation. The settlement resolves the qui tam case United States ex rel. GNGH2, Inc. v. Tellico Village Property Owners Association, Inc., No. 3:23-cv-199 (E.D. Tenn.), and the claims are allegations only, with no determination of liability.
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Full text
KNOXVILLE, Tenn. – Tellico Village Property Owners Association, Inc. (TVPOA) has agreed to pay $1,361,992.22 to resolve allegations that it violated the False Claims Act by applying for, receiving, and obtaining forgiveness of a loan under the Paycheck Protection Program (PPP) for which it was not eligible. Congress created the PPP in March 2020, as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, to provide relief to small businesses experiencing economic hardship during the COVID-19 pandemic. Although certain nonprofit organizations were eligible to receive PPP Loans at various times throughout the program, 501(c)(4) nonprofit organizations have never been eligible. In April 2020, TVPOA, a 501(c)(4) nonprofit organization, applied for and received a PPP loan. The PPP application required applicants to identify their business type from a list of eligible options or, alternatively, to select “Other.” The application also required applicants to certify that they were eligible to receive a PPP loan. On the application it submitted, “C-Corp” was selected as TVPOA’s entity type. In submitting its application, TVPOA represented that it was eligible to receive the applied-for loan. TVPOA later applied for and received forgiveness of its PPP loan. TVPOA cooperated fully with the United States’ investigation and contends that any misstatements in its application were inadvertent. The settlement amount reflects TVPOA’s cooperation. This Settlement resolves a lawsuit filed under the qui tam , or whistleblower, provisions of the False Claims Act, which permits private parties to sue on behalf of the government for false claims and receive a share of any recovery. The qui tam case is captioned United States ex rel. GNGH2, Inc. v. Tellico Village Property Owners Association, Inc. , No. 3:23-cv-199 (E.D. Tenn.). Assistant U.S. Attorneys Alexa Ortiz Hadley and Ben Cunningham represented the United States, with assistance from the Small Business Administration. On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across the government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus . Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form . The claims resolved by this settlement are allegations only, and there has been no determination of liability. ###
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