California Agricultural Firms Reaches Settlement on PPP Mortgage Fraud Allegations

The proprietor of 4 Californian agricultural corporations has agreed to settle allegations that he and his corporations violated the False Claims Act, with the settlement quantity totalling round $600,000.

California Agricultural Firms Reaches Settlement on PPP Mortgage Fraud Allegations

The businesses embrace Mendota Land Co., Sweetwood Farm Co. LLC, Sweetwood Farm Inc., and Seasholtz Co. LLC, collectively owned by John Seasholtz. The allegations in opposition to Mr Seasholtz are additionally associated to the Monetary Establishments Reform, Restoration and Enforcement Act (FIRREA), with the accused allegedly knowingly submitting false data in assist of Paycheck Safety Program (PPP) mortgage functions.

californian agricultural companies reaches settlement on ppp loan fraud

Inclusion of Non-Staff Inflated PPP Loans

Seasholtz is alleged to have improperly inflated the worker headcount on his corporations’ PPP mortgage functions, primarily by illegally together with non-employee contract employees who have been really employed by different entities unrelated to any of the 4 named corporations.

The allegations state that the inclusion of such non-employees enabled Seasholtz to obtain round $1.8 million in extra PPP funds. He has since repaid the surplus PPP mortgage funds to the lender, which relieved the U.S. Small Enterprise Administration of legal responsibility for the sum in mortgage ensures.

Correct Info the ‘Accountability of the Applicant’

The Principal Deputy Assistant Lawyer Common, Brian M. Boynton, additionally Head of the Civil Division on the Division of Justice, mentioned: “PPP loans have been meant to supply crucial reduction to small companies. The division is dedicated to pursuing those that knowingly obtained PPP or different COVID-19 help funds to which they weren’t entitled.”

Phillip A. Talbert for the Jap District of California added: “Paycheck Safety Program funds have helped certified companies all through the Central Valley that have been negatively impacted by the pandemic. The U.S. Lawyer’s Workplace invested vital time and assets on this investigation and can proceed to take action to make sure that PPP funds solely go to those that are eligible.”

Particular Agent in Cost, Weston King, of the Small Enterprise Administration’s Workplace of Inspector Generals, additionally spoke on the matter by explaining that: “Offering correct data when making use of for the SBA’s very important catastrophe reduction applications is the person accountability of the applicant. This settlement demonstrates that wrongdoing will discover its approach into the open, and people accountable will likely be held accountable. I wish to thank the U.S. Lawyer’s workplace and our regulation enforcement companions for his or her assist and dedication to pursuing justice on this case.”

Seasholtz’s Damages and Penalties

The settlement by Seasholtz means he has agreed to pay roughly $400,000 in damages and penalties below the False Claims Act, in addition to roughly $200,000 in civil penalties below FIRREA.

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