The onset of COVID-19 pandemic in the United States placed thousands of businesses under significant financial strain. Unable to do business as usual, many business owners sought financial protection from the federal government.
However, we now know that many applications for financial protection were fraudulent. A variety of programs such as the Paycheck Protection Program (PPP), loans through the Small Business Administration (SBA), and the CARES Act provided assistance to companies under legitimate strain. Unfortunately, many unscrupulous business owners took this money without having an authentic need.
A Columbia PPP fraud whistleblower lawyer could help individuals who have witnessed abuses of the COVID-19 relief programs. An attorney could work to determine if a violation has occurred, to identify the correct way to blow the whistle, and to push for an appropriate reward through a writ of ‘Qui Tam.
What is PPP fraud? The federal government recognized that COVID-19 presents a major challenge to small businesses in mid-2020. As a result, a variety of tools are available to help companies that are struggling to pay employees or remain in business.
Prominent examples include:
These loans are not available to everyone. For example, EIDL loans are only available if the company is a “small business.” In the United States, this generally means a company with fewer than 500 employees. Unfortunately, this did not stop larger companies from applying for these loans. This is an example of PPP fraud that violates federal law. A local PPP fraud whistleblower attorney could provide more information about the COVID-19 relief programs and what behavior may count as fraud.
The government’s various regulatory agencies have the power to investigate and punish abuses of the COVID-19 loan programs. Unfortunately, they often lack the resources to identify each instance of fraud. As a result, the Department of Justice employs a whistleblower program that empowers private citizens to report violations of the law.
One example of a law that COVID-19 fraud may violate is the False Claims Act. According to 31 United States Code § 3729, no party may knowingly submit a fraudulent or incorrect claim for payment to the US government. Submitting an application for PPP while ineligible may certainly fall under this category, and the False Claims Act specifically allows citizens to serve as whistleblowers.
To encourage people to come forward about PPP loan fraud, blowing the whistle under the False Claims Act could also result in a monetary reward. Under 31 United States Code § 3730(c)(5), parties can include a writ of Qui Tam along with their whistleblower complaint. If the information that a whistleblower provides leads to a conviction, that party may receive between 15 and 25 percent of the funds recovered in the prosecution. A Columbia PPP fraud whistleblower attorney could help parties to seek out these rewards.
The various government relief programs available because of COVID-19 can provide essential economic relief for struggling businesses. Loans under PPP, the CARES Act, or EIDL can provide key financial flexibility in times where finances may be strained.
These programs are available only to small businesses. However, this did not stop larger companies from applying for these loans or companies from taking money when they were not in need. These actions may be violations of the False Claims Act.
If you believe that you have witnessed an abuse of a COVID-19 relief program, such as PPP fraud, you have the ability to come forward as a whistleblower. A Columbia PPP fraud whistleblower lawyer could help you to further investigate your suspicions and submit reports to the relevant regulatory agency. Contact us today to get started.