FLORIDA – Victory Automotive Group Inc. (VAG), a Port Richey-based automotive management company, has agreed to pay $9 million to resolve allegations that it violated the False Claims Act (FCA) by knowingly providing false information in support of a Paycheck Protection Program (PPP) loan forgiveness application it submitted, the US Department of Justice (DOJ) has announced.
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According to the DOJ, VAG’s application for a PPP loan certified it was a small business with fewer than 500 employees. However, VAG shared common operational control with dozens of automobile dealerships across the country, and VAG and its affiliates had more than 3,000 employees in total, the DOJ said. According to the DOJ, for that reason, VAG was not eligible for the $6,282,362 PPP loan it received, which was later forgiven in full.
“PPP loans were intended to help small businesses during the pandemic,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division.
“The department is committed to holding accountable those who undermined the purpose of the PPP program and knowingly obtained PPP funds for which they were not eligible.”
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The settlement resolved a lawsuit filed under the qui tam or whistleblower provision of the FCA, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The qui tam lawsuit is captioned U.S. ex rel. Jones v. Victory Automotive Group, Inc, et al., No. 8:21-cv-1742 (M.D. Fla.). The whistleblower will receive a total of approximately $1.62 million in connection with the settlement.
The resolution obtained in this matter was the result of a coordinated effort among the Civil Division’s Commercial Litigation Branch, Fraud Section and the U.S. Attorney’s Office for the Middle District of Florida, with assistance from the SBA’s Office of General Counsel and the SBA’s Office of Inspector General.
This matter was handled by Senior Trial Counsel Benjamin C. Wei of the Civil Division and Assistant U.S. Attorney Lindsay Saxe Griffin for the Middle District of Florida, with assistance from Christopher J. McClintock of the SBA.
The claims resolved by the settlement are allegations only. There has been no determination of liability.
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