Longchamp USA, Inc., a manufacturer and distributor of fashion and leather products based in Mercer County, New Jersey, entered into a settlement agreement with the United States resolving allegations that it violated the False Claims Act by receiving a Paycheck Protection Program (PPP) loan to which it was not entitled, U.S. Attorney Robert Frazer announced on July 21.
According to the United States’ contentions in the settlement agreement, Longchamp applied for and received a $1,379,972 PPP loan in May 2021. At that time, eligibility rules required businesses to have no more than 300 employees inclusive of affiliates worldwide. Longchamp certified its eligibility but had more than 300 employees when including its affiliates and their foreign employees. The company subsequently sought and received forgiveness for the full amount of the loan plus accrued interest. The government also paid an associated lender processing fee of $41,399.
Longchamp fully cooperated with authorities during the investigation and resolution process. Under the terms of the settlement agreement, Longchamp paid $1,997,110 to resolve these allegations. The case originated from a lawsuit filed under the whistleblower provision of the False Claims Act; as part of this process private parties known as relators can file suit on behalf of the United States and receive part of any recovery. In this matter, the relator’s share was $199,710.
The government was represented by Assistant U.S. Attorney Thandiwe Boylan from Newark’s Health Care Fraud & Opioid Enforcement Unit with assistance from Trial Attorney Denise Grugan at the Office of Capital Access within the U.S. Small Business Administration.
Anyone with information about alleged COVID-19 fraud may contact federal authorities through dedicated hotlines or web forms provided by law enforcement agencies.
The claims resolved by this settlement are allegations only; there has been no determination of liability.
The U.S. Attorney’s Office for the District of New Jersey is part of the Department of Justice and prosecutes federal crimes while representing civil interests across New Jersey through offices in Newark, Trenton and Camden staffed by approximately 170 attorneys and support personnel; it also advances community safety through law enforcement coordination and crime prevention programs, according to its official website.