Arlington Firm Accused Of Receiving Multiple PPP Loans Agrees To Pay Fines And Damages.

ARLINGTON, VA — An Arlington company agreed in federal court on Friday to pay approximately $31,000 in damages and civil penalties in order to settle allegations that it violated the False Claims Act and had obtained more than one Paycheck Protection Program loan in 2020, according to court documents.

J. Bryan Quesenberry had filed a lawsuit against Zen Solutions Inc., which provides staffing services, under the whistleblower provision of the False Claims Act. This provision allows individuals to file suit on behalf of the federal government. As part of the settlement, Quesenberry will receive a portion of the recovery.

Quesenberry's lawsuit alleged that Zen Solutions had received more than one PPP loan in 2020. In the settlement, the company agreed to repay the loan in full to its lender. As the federal guaranty of the improper loan, U.S. Small Business Administration was liable to the lender for approximately $192,000. The settlement removes SBA's liability.

“PPP funds were set aside by Congress to aid Americans in desperate need as a result of the global pandemic,” said Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia, in a release. “Abusing these funds prevents them from going to those truly in need and wastes public funding at the expense of the American taxpayers. As a result, pursuing PPP loan fraud is a high priority for our office.”

Congress established the PPP loan program as part of the 2020 Coronavirus Aid, Relief, and Economic Security (CARES) Act to provide emergency financial support for millions of Americans facing the economic effects of the pandemic.