Michele Beckwith Acting U.S. Attorney | U.S. Attorney for the Eastern District of California
Governmental Advocates Inc., a Sacramento-based political consulting firm, has resolved civil claims related to a Paycheck Protection Program (PPP) loan it was ineligible to receive. The firm self-disclosed its ineligibility and voluntarily paid over $200,000 to settle the claims, as announced by Acting U.S. Attorney Michele Beckwith.
The PPP was established in March 2020 under the Coronavirus Aid, Relief, and Economic Security Act to support small businesses facing economic challenges during the COVID-19 pandemic. However, businesses primarily engaged in political or lobbying activities were not eligible for these loans.
In September 2024, Governmental Advocates informed the United States that it was not eligible for the PPP loan due to its lobbying activities. The firm had initially applied for the loan in April 2020 and later sought forgiveness for it. The Small Business Administration (SBA) approved this request, forgiving $183,688 in principal and $2,289.81 in interest. In today's settlement announcement, Governmental Advocates agreed to pay a total of $239,954.87 to cover the repaid principal, forgiven interest, bank fees paid by the SBA, and settlement interest.
Acting U.S. Attorney Beckwith commented on the matter: “We are pleased that Governmental Advocates chose to voluntarily disclose this conduct and make full repayment.” She encouraged other companies that might have mistakenly received federal funds to consider self-disclosure and cooperation.
Wendell Davis from SBA's General Counsel remarked on the settlement: “The favorable settlement in this case is the product of enhanced efforts by federal agencies...to pursue a fair recovery of pandemic relief funds.”
Assistant U.S. Attorney Tara Amin handled this matter. It is important to note that these claims are allegations only; no liability has been determined.
Individuals with information about potential fraud related to COVID-19 can report it via the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or through their online complaint form.
