A South Carolina corporation has agreed to pay over $5 million to resolve allegations that it violated the False Claims Act by applying for and receiving a Paycheck Protection Program loan for which it was not eligible, according to an announcement by U.S. Attorney Robert Frazer on Dec. 15.
China Jushi USA Corp., a subsidiary of China Jushi Corp., manufactures and sells fiberglass products and is based in Columbia, South Carolina. The United States contends that between July 27, 2020, and June 21, 2021, China Jushi USA applied for and received a first-draw PPP loan and forgiveness totaling $3,590,007 including interest. Authorities allege that the company falsely certified its eligibility for the program by failing to account for affiliate employees, thereby exceeding size standards required under the program’s rules. As a result of these alleged false statements on its application, the government also paid $35,581 in lender processing fees associated with the ineligible loan.
Under terms of the settlement agreement, China Jushi USA paid $5,075,823 to resolve these claims. The case was brought under the whistleblower provision of the False Claims Act; as part of this resolution, relator Aidan Forsyth will receive $507,582 as their share of the recovery. U.S. Attorney Frazer credited assistance from the Small Business Administration’s Office of General Counsel in resolving this matter.
The government’s legal team included Assistant U.S. Attorney Susan J. Pappy from Newark’s Health Care Fraud and Opioids Enforcement Unit with support from Trial Attorney Denise Grugan at the Small Business Administration. Anyone with information about attempted COVID-19 fraud is encouraged to contact federal authorities through dedicated hotlines or online forms provided by the Department of Justice.
The qui tam lawsuit is titled US ex rel. Aidan Forsyth v. China Jushi USA Corp., case number 24-cv-09959 (D.N.J.). Officials emphasized that “the claims resolved by the settlement are allegations only, and there has been no determination of liability.” The U.S. Attorney’s Office for the District of New Jersey prosecutes federal crimes across New Jersey and represents civil interests statewide; it operates offices in Newark, Trenton and Camden with about 170 attorneys and staff members as part of its mission within the Department of Justice—advancing community safety through law enforcement coordination and crime prevention programs—and counts among its alumni several federal judges and senators, according to its official website.