A company based in Sterling Heights, Michigan, Slifco Electric, LLC, has agreed to pay $1,460,062 to settle allegations of violating the False Claims Act. The settlement focuses on false certifications made to the U.S. Small Business Administration (SBA) under the Paycheck Protection Program (PPP). The announcement was made by Acting United States Attorney Julie A. Beck. John P. Slifco owns Slifco Electric, LLC.
The PPP, established in March 2020, provided financial aid to businesses experiencing the impact of the COVID-19 pandemic. It offered forgivable loans guaranteed by the SBA. To obtain loan forgiveness, businesses needed to certify truthfulness and accuracy in the information submitted. They were also required to disclose any capital distributions to owners during the loan forgiveness period.
In April 2020, Slifco Electric obtained a first draw PPP loan amounting to $2,633,170. The U.S. government alleged that Slifco Electric falsely certified their eligibility for full loan forgiveness. It failed to report capital distributions totaling $730,031 to its owner, John P. Slifco, used for personal expenses during the specified period.
Acting U.S. Attorney Beck emphasized, “When businesses and individuals obtained COVID-19 relief funds that they didn’t deserve, taxpayers were cheated.” The office is intent on addressing violations against government programs.
SBA General Counsel Wendell Davis noted the settlement resulted from concerted efforts by the Small Business Administration and various federal law enforcement agencies. The cooperation also included input from private individuals who identified fraudulent activities.
Assistant U.S. Attorney Anthony Gentner managed the case with support from the SBA’s Office of General Counsel. Information about fraud relating to COVID-19 can be reported to the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline.
It is important to note that the settlement resolves allegations, with no liability determination made.
