Mobile Programming LLC, a Wyoming corporation based in California, and A-1 Technology, Inc., a Delaware corporation based in New York, have agreed to pay $2,353,391.06 to resolve allegations that they improperly obtained Paycheck Protection Program loans from the U.S. Small Business Administration for which they were not eligible, according to an Aug. 4 announcement by the U.S. Attorney’s Office for the District of Delaware.
The Paycheck Protection Program was established by Congress in March 2020 under the Coronavirus Aid, Relief, and Economic Security Act and administered by the SBA to support small businesses during the COVID-19 pandemic. A second round of loans was authorized in early 2021. To qualify for these Second Draw PPP loans, businesses were required to certify that they had no more than 300 employees including all domestic and foreign affiliates.
Mobile Programming received a $1,326,949 Second Draw PPP loan while A-1 Technology received a $184,287 Second Draw PPP loan after certifying on their applications that they had fewer than 300 employees together with their affiliates. Both companies subsequently applied for and received forgiveness of these loans. However, authorities allege that Mobile Programming and A-1 Technology together with their affiliates actually had more than 300 employees at the time.
U.S. Attorney Benjamin L. Wallace announced the settlement, while Assistant United States Attorney Claudia L. Pare handled the case.
The civil settlement resolves claims brought under qui tam or whistleblower provisions of the False Claims Act, which allow private parties—known as relators—to file actions on behalf of the United States and receive a portion of any recovery; in this case, the relator will receive part of the settlement amount.
The Department of Justice encourages individuals with information about COVID-19 fraud allegations to report them via its National Center for Disaster Fraud Hotline or web complaint form. The claims resolved by this settlement are allegations only; there has been no determination of liability.