Taiji Group USA, Inc., a paper converter based in Conover, North Carolina, has agreed to pay $460,395.09 to settle allegations of violating the False Claims Act. The company was accused of providing false information to obtain a Paycheck Protection Program (PPP) loan it was not entitled to receive. This announcement was made by Lawrence J. Cameron, Acting U.S. Attorney for the Western District of North Carolina.
The PPP was established in March 2020 under the Coronavirus Aid, Relief, and Economic Security (CARES) Act to offer forgivable loans to small businesses facing financial difficulties due to the pandemic. In 2021, a second round of these loans was made available through the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act. Applicants were required to certify that all information provided in their applications was truthful and accurate.
In March 2021, Taiji Group applied for a second-round PPP loan and certified its eligibility for receiving such a loan. The company claimed that no entity created or organized under the laws of the People’s Republic of China owned or held 20 percent or more of its economic interest and that it did not have any board members who were residents of China. These certifications were allegedly false at the time of application, making Taiji Group ineligible for the $271,165 loan it received and later had forgiven.
"PPP loans were a lifeline for many businesses during the COVID-19 pandemic," stated Acting U.S. Attorney Cameron. "Ineligible businesses that improperly obtained federal aid loans harmed the taxpayers who funded these programs and reduced the resources available for businesses that were eligible to receive assistance."
The case originated from a lawsuit filed under the qui tam provision of the False Claims Act by Sidesolve LLC on behalf of the United States. Assistant U.S. Attorney Seth Johnson represented the government in this matter.
Individuals with information about potential fraud related to COVID-19 can report it via the Department of Justice’s National Center for Disaster Fraud Hotline or through their online complaint form.
It is important to note that these claims are allegations only; there has been no determination of liability.