Setterstix Inc. and MAE-EITEL Inc., both controlled by foreign interests, have agreed to pay a total of $1,757,603.65 to settle allegations that they improperly received Paycheck Protection Program (PPP) loans from the U.S. Small Business Administration for which they were not eligible.
The PPP was created by Congress in March 2020 to support American small businesses during the COVID-19 pandemic. The program offered forgivable loans guaranteed by the SBA, but applicants had to certify their eligibility based on employee size limits.
According to federal authorities, Setterstix obtained a PPP loan in 2020 after certifying it had fewer than 500 employees. However, officials allege that when counting employees of its parent company and affiliates, Setterstix actually exceeded this threshold. Similarly, MAE-EITEL received a PPP loan in 2021 after claiming fewer than 300 employees; the government alleges it too surpassed this limit once affiliated entities were included in the count. Both companies are part of GESCO Group, a German-based conglomerate focused on acquiring medium-sized industrial firms.
U.S. Attorney Michael DiGiacomo stated: “PPP loans were meant to help small business weather the effects of the COVID-19 pandemic, but too often large businesses obtained these funds through subsidiaries that failed to disclose their true size.” He added: “This office has been committed to recovering misspent money and, in 2025, more than $10 million has already been recovered from companies and entities that obtained PPP loans through false and fraudulent representations on PPP loan applications.”
The settlement resolves claims brought under the False Claims Act’s qui tam provisions. These allow private individuals—known as relators—to file lawsuits on behalf of the United States and potentially receive a portion of any recovery. In this case (United States ex rel. Verity Investigations, LLC v. Setterstix Inc.; MAE-AMERIKA GmbH), the relator will receive part of the settlement amount.
Assistant U.S. Attorneys David M. Coriell and Investigator Margaret McFarland handled this matter with assistance from the SBA’s Office of General Counsel.
The Department of Justice encourages anyone with information about COVID-19 fraud allegations to report them via its National Center for Disaster Fraud Hotline at 866-720-5721 or through its online complaint form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Authorities note that these are only allegations; no determination of liability has been made.
