On October 11, the U.S. Department of Justice (DOJ) announced a $399,990 settlement with Allstar Health Providers Inc., a California home health care agency, and its owner, Maria Chua, over allegations that they violated the False Claims Act (FCA) through Paycheck Protection. Program Loan Fraud (PPP).

According to the DOJ, Chua submitted two PPP loan applications on behalf of Allstar Health Providers in May 2020 and in both applications she stated that the company would not receive more than one loan before December 31, 2020.

“Despite these certifications, the United States alleged that Allstar Health Providers received two PPP loans in 2020 and then knowingly and improperly withheld the second duplicate loan,” the government alleges.

The settlement arises from a qui tam whistleblower lawsuit filed by J. Bryan Quesenberry. Tthe False Claims Act qui tam provisions allow individuals and private parties to file lawsuits on behalf of the government if they know that a person or company is defrauding the government. Qui tam whistleblowers are eligible for between 15 and 30% of the recovery amount from the government.

“PPP loans were intended to provide critical relief to small businesses,” said Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department is committed to prosecuting those who knowingly violated the requirements of the PPP or other COVID-19 relief programs and obtained relief funds to which they were not entitled.”

“If an individual violates the False Claims Act by fraudulently receiving and retaining PPP loans, taxpayers lose,” said U.S. Attorney Martin Estrada for the Central District of California. “Those who violate the law by fraudulently receiving and maintaining PPP loans will be held accountable.”

In July 2023, a bipartisan group of senators introduced the False Claims Amendments Act of 2023, which addresses a number of technical loopholes that undermine the FCA’s success. The bill is widely supported by whistleblower advocates.

The National Whistleblower Center (NWC) issued an Action Alert calling on Congress to pass the bill.

Join NWC and take action:

Demand that Congress strengthen the False Claims Act

Further reading:

California Home Health Agency and Owner Settle False Claims Act Allegations Related to Improper Payroll Protection Program Loan

Bipartisan legislation unveiled to strengthen the False Claims Act

More False Claims Whistleblower Act New