Leah B. Foley United States Attorney for the District of Massachusetts | Department of Justice
The International Brotherhood of Electrical Workers Local 103, based in Dorchester, Massachusetts, has agreed to pay more than $2 million to resolve claims it received a Paycheck Protection Program (PPP) loan before it was eligible. The union is classified as a 501(c)(5) nonprofit organization.
According to the settlement, IBEW Local 103 acknowledged that in April 2020 it applied for and obtained a first-round PPP loan at a time when unions were not yet eligible for the program. Congress amended the PPP in March 2021 to allow certain nonprofits, including unions like IBEW Local 103, to participate. Following this change, the union applied for and received a second loan. On its application for the second round, the union certified its eligibility under updated regulations and stated it had used all funds from the first loan prior to applying again. The settlement states that if IBEW Local 103 had waited until March 2021 to apply for its first PPP loan, it would not have been able to spend those proceeds before seeking additional funds.
The PPP was established by Congress through the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) on March 29, 2020. It provided forgivable loans aimed at helping small businesses retain employees during the COVID-19 pandemic. The Small Business Administration administered two rounds of funding: one beginning in April 2020 and another in February 2021. Nonprofit organizations such as IBEW Local 103 became eligible only after congressional amendments in March 2021.
The Department of Justice credited IBEW Local 103 with cooperation during the investigation under federal guidelines concerning voluntary disclosure and remediation.
"United States Attorney Leah B. Foley and the U.S. Small Business Administration made the announcement today. Assistant U.S. Attorney Brian M. LaMacchia, Chief of the Affirmative Civil Enforcement Unit handled the matter."
