A New Jersey company has agreed to pay back $3.25 million after receiving Paycheck Protection Program funds it was not eligible for, U.S. Attorney Clint Johnson announced on Apr. 14.
The settlement follows allegations that Eurecat U.S. Incorporated received excessive COVID-19 relief money under the CARES Act by exceeding employee limits required for loan eligibility.
According to court documents, Eurecat applied for a first Paycheck Protection Program (PPP) loan in May 2020 and received over $2.7 million, which was later forgiven. The company then applied for a second PPP loan in February 2021 and received an additional $2 million, also forgiven in August of that year. However, as part of the settlement agreement, Eurecat admitted it had more than the allowed number of employees—over 9,000—making it ineligible for the second round of PPP loans.
The civil complaint against Eurecat was filed by GNGH2, Inc., acting as a whistleblower under the Federal False Claims Act’s qui tam provisions. Of the total repayment amount, more than $2 million will be restitution; GNGH2 will receive $325,000 as its statutory share under federal law.
Assistant U.S. Attorney Michael Cooper represented the Northern District of Oklahoma with assistance from the Small Business Administration’s Office of General Counsel during litigation.
The Department of Justice Fraud Section leads efforts to prosecute fraud involving COVID-19 relief programs like PPP and has brought charges against over 150 defendants since these programs began.
