Rosler Metal Finishing USA LLC, a manufacturer based in Battle Creek, has agreed to pay $2,289,505.40 to resolve allegations of falsely obtaining a second-draw Paycheck Protection Program (PPP) loan. The announcement was made by Acting U.S. Attorney for the Western District of Michigan Andrew Birge.
“The Paycheck Protection Program was intended only for those who met the eligibility criteria,” stated Acting U.S. Attorney Andrew Birge. “My office will continue to pursue recipients who falsely obtained PPP loans.”
In January 2021, Rosler USA applied for and received a second-draw PPP loan amounting to $1,265,035, which was later forgiven by the Small Business Administration (SBA). The United States claims that Rosler USA was not eligible for this loan as the company and its affiliates had over 300 employees. Additionally, it is alleged that Rosler USA falsely certified having fewer than 300 employees and did not disclose shared ownership with other businesses.
The PPP was established under the Coronavirus Aid, Relief and Economic Security (CARES) Act in March 2020 and expanded by the American Rescue Plan Act (ARPA) in 2021. It provided loans to eligible businesses for payroll costs or other specified expenses with forgiveness options if spent on eligible expenses. However, eligibility required that applicants and their affiliates have no more than 300 employees collectively.
Wendell Davis, General Counsel at the SBA commented on the settlement: “The settlement in this matter reflects SBA’s commitment to identifying and pursuing those who perpetrated fraud on the Paycheck Protection Program. Such fraud unconscionably undermines critical pandemic relief.”
The civil settlement resolves claims brought under the qui tam provisions of the False Claims Act against Rosler USA. Under these provisions, private parties can file actions on behalf of the United States and potentially receive part of any settlement or judgment. In this case, titled U.S. ex rel. GNGH2 Inc. v. Rosler Metal Finishing USA LLC a/k/a Roesler Metal Finishing USA LLC, No. 1:24-cv-373 (W.D. Mich.), the United States chose to take over the case.
This resolution resulted from collaboration between the U.S. Attorney’s Office for the Western District of Michigan and SBA's efforts led by Assistant United States Attorney Whitney M. Schnurr.
It is important to note that these are allegations only; there has been no determination of liability.
