California Lobbying Firm Agrees to Settle Fraud Allegations Involving Paycheck Protection Program

Political Solutions, LLC, has agreed to pay the United States $556,924 in damages and penalties to resolve allegations that it violated the False Claims Act (FCA) and the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) by receiving a loan under the Paycheck Protection Program (PPP), Acting U.S. Attorney Kimberly A. Sanchez announced.

Congress created the PPP in March 2020 as part of the Coronavirus Aid, Relief, and Economic Security Act to provide emergency relief to small businesses experiencing economic hardship caused by the COVID-19 pandemic. Although many small businesses were eligible for these loans, some were not, including those primarily engaged in political or lobbying activities.

In April 2020, Political Solutions, a lobbying firm, applied for and received a PPP loan for $216,000. Political Solutions applied for and received forgiveness of the loan from the U.S. Small Business Administration (SBA) in January 2021. This settlement resolves allegations that Political Solutions knowingly made false statements in certifying the business’s eligibility for a PPP loan. As part of the settlement, Political Solutions agreed to pay $456,924 in damages under the FCA and $100,000 in civil penalties under FIRREA.

“The Paycheck Protection Program was a vital resource for struggling small businesses during the COVID-19 pandemic,” said Acting U.S. Attorney Sanchez. “This Office will continue to investigate businesses who took advantage of these funds at the expense of the public.”

SBA General Counsel Wendell Davis stated, “The favorable settlement in this case is the product of enhanced efforts by federal agencies, such as the Small Business Administration working in conjunction with the U.S. Attorney’s Office, to pursue a fair recovery of pandemic relief funds.”

This matter was handled by Assistant U.S. Attorney Robert A. Fuentes.

The claims resolved by this settlement are allegations only, and there has been no determination of liability.