Peachtree City Company to Pay $2.6 Million to Settle Alleged PPP Loan Fraud Claims
NEWNAN, Ga. – A Peachtree City-based environmental services company has agreed to pay $2.6 million to resolve allegations that it improperly obtained forgiveness of a Paycheck Protection Program loan by underreporting the size of its corporate workforce.
Universal Environmental Services LLC (UES), a subsidiary of the Germany-based Avista Oil Group, reached the civil settlement with the United States to resolve allegations that it violated the False Claims Act in connection with a second-draw PPP loan obtained during the COVID-19 pandemic.
Federal prosecutors alleged UES falsely represented that it qualified as a small business when it applied for the loan in 2020.
According to the U.S. Attorney’s Office, second-draw PPP loans were available only to businesses employing fewer than 300 workers, including employees of affiliated companies within the same corporate family.
Investigators alleged UES reported having 287 employees on its loan application, counting only its domestic workforce. Prosecutors contend the company’s parent organization and affiliated entities employed well over 300 people, making UES ineligible for the loan under Small Business Administration rules.
Based on the information provided in the application, a bank approved an approximately $2 million PPP loan, which was later forgiven by the Small Business Administration using taxpayer funds, according to federal authorities.
“When people provide false information to obtain government-backed loans, they break the law and misdirect resources away from those who need them,” U.S. Attorney Theodore S. Hertzberg said in a statement. “Our office will continue to enforce the False Claims Act to recover such funds, plus penalties.”
The government’s investigation began after a whistleblower filed a lawsuit under the False Claims Act’s qui tam provisions, which allow private individuals to bring fraud claims on behalf of the United States.
As part of the settlement, the whistleblower will receive approximately $312,000. UES also agreed to pay the whistleblower’s attorney fees.
The settlement resolves civil allegations only. Federal officials emphasized there has been no determination of liability by the court.
The case was investigated and resolved by Assistant U.S. Attorney Anthony DeCinque.
