Group of Pennsylvania-Based Car Companies Settle Matter Alleging Receipt of Improper CARES Act Loans

Newark, N.J. – Five companies based in Bucks County, Pennsylvania entered into a settlement agreement with the United States resolving allegations that they violated the False Claims Act by taking Paycheck Protection Program (PPP) loans to which they were not entitled, Acting U.S. Attorney and Special Attorney Alina Habba announced.

According to the allegations in the complaint and the contentions of the United States in the settlement agreement:

In April 2020, Fred Beans Holdings, Inc.; Auto Express Enterprises, Inc.; Autorent of Doylestown Inc.; McCafferty Autorent Inc.; and Noble Advertising, Inc. (together, “the Defendants”) each applied for and received approximately $973,395 in PPP loans. Under the eligibility rules in effect at the time, businesses with more than 500 employees, inclusive of their affiliates, were not eligible for PPP loans. In their respective loan applications, the Defendants certified that they were eligible for their loans. However, the Defendants were ineligible for their loans because, inclusive of their affiliates, they had more than 500 employees. After receiving their PPP loans, Defendants sought and received forgiveness of the total amount of the loans plus interest that had accrued.

Defendants fully cooperated in the investigation and resolution of this matter. In accordance with the terms of the settlement agreement, Defendants will pay the United States $1,427,869.  The settlement resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties, called relators, to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. In this matter, the relator is receiving $142,786 as the share.

The government is represented by Assistant U.S. Attorney David V. Simunovich of the Health Care Fraud and Opioids Enforcement Unit in Newark.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

The qui tam case is captioned United States ex rel. Forsyth v. Fred Beans Holdings, Inc., et al., 25-2324 (D.N.J.).

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Counsel for Ulma Form Works, Inc.: Denise Branch, Esq., Raleigh, NC

Counsel for Relator Aidan Forsyth: Eric Jaso, Esq., Montclair, NJ