Leah B. Foley United States Attorney for the District of Massachusetts | Department of Justice
Azumi Limited Restaurants have agreed to pay $3.6 million to resolve allegations of violating the False Claims Act related to Paycheck Protection Program (PPP) loans. The companies involved include Azumi, LLC; Zuma NYC, LLC; Zuma Las Vegas, LLC; Zuma Japanese Restaurant Miami, LLC; Inko Nito Garey St., LLC; and Beach Chu Hallandale, LLC.
The PPP was established by Congress in March 2020 and administered by the U.S. Small Business Administration (SBA) to support small businesses during the COVID-19 pandemic. Borrowers could seek loan forgiveness if they used funds for payroll and eligible expenses. In January 2021, SBA allowed certain parties to apply for a second-draw PPP loan.
Borrowers had to certify their application information's truthfulness and accuracy and comply with all PPP rules, including limits on total funding a "corporate group" could receive from both first-draw and second-draw loans.
The Azumi Entities admitted receiving and being granted forgiveness for second-draw loans exceeding the corporate group limit. "The Paycheck Protection Program limits were put in place to prevent large corporate groups from obtaining a disproportionate share of the limited funds that were available to assist small businesses struggling during COVID," said United States Attorney Leah B. Foley.
Assistant Attorney General Brett A. Shumate stated, "PPP loans were intended to assist eligible small businesses during the pandemic." He emphasized that when ineligible businesses obtained loans improperly, it harmed taxpayers who funded the program and eligible businesses denied relief.
Today's settlement resolves claims brought under the qui tam provisions of the False Claims Act. This allows private parties to file actions on behalf of the United States and receive part of any recovery. The case is titled United States ex rel. GNGH2, Inc. v. Azumi, LLC, et al., No. 22-cv-11822 (D. Mass. 2022). GNGH2, Inc., will receive about $360,000 as part of this resolution.
U.S. Attorney Foley and AAG Shumate announced this resolution with assistance from SBA’s Office of General Counsel and Office of Inspector General. Assistant U.S. Attorney Julien M. Mundele handled the matter alongside Trial Attorney Kimya Saied and Senior Trial Counsel Benjamin Wei from the Department of Justice’s Fraud Section.
