California Home Health Agency and Owner Settle False Claims Act Allegations Over Improper PPP Loan

Allstar Health Providers Inc., a home health agency based in California, and its owner, Maria Chua, have agreed to pay $399,990 to the United States to settle allegations that they violated the False Claims Act by improperly receiving and retaining more than one Paycheck Protection Program (PPP) loan prior to December 31, 2020, in violation of PPP rules.

The Paycheck Protection Program, established in March 2020 under the Coronavirus Aid, Relief, and Economic Security (CARES) Act and administered by the Small Business Administration (SBA), was designed to help small businesses cover payroll and other essential business expenses during the COVID-19 pandemic. Under the rules governing the PPP in 2020, applicants were required to certify that they would not receive more than one PPP loan prior to December 31, 2020.

According to the U.S. government, Maria Chua, on behalf of Allstar Health Providers, submitted two PPP loan applications in May 2020. In both applications, she certified that the company would not receive more than one PPP loan before the end of 2020. Despite these certifications, Allstar Health Providers allegedly received two PPP loans in 2020 and knowingly retained the second, duplicate loan without repaying it. The failure to repay the duplicate loan resulted in a loss to the SBA when it purchased the loan guaranty on the second loan.

The settlement also resolves claims brought under the qui tam, or whistleblower, provisions of the False Claims Act by J. Bryan Quesenberry. Under these provisions, private parties can file actions on behalf of the United States and receive a portion of the recovery. As part of the settlement, Mr. Quesenberry will receive approximately $60,000.

The resolution of this matter involved a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the Central District of California, with assistance from the SBA’s Office of General Counsel and Office of the Inspector General.