General · June 2, 2021

Virginia Company Agrees to Settle Civil Fraud Allegations

Virginia Company Agrees to Settle Civil Fraud Allegations for Paycheck Protection Program Loans

ALEXANDRIA, VA (STL.News) KC Investments Group, Inc. (KC Inc.) and its sole individual owner, Sunu P. KC, of Chantilly, have agreed to pay $230,414.65 to settle civil fraud allegations that KC Inc., through Sunu P. KC, obtained multiple loans during the first draw of the Paycheck Protection Program (PPP), announced Acting U.S. Attorney Raj Parekh for the Eastern District of Virginia.

The PPP was established in March 2020 as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and the program has been managed by the Small Business Administration (SBA).  The PPP was intended to provide loans to qualified businesses to allow them to maintain payroll and operations through the COVID-19 pandemic.  Each qualified business was allowed to receive only one PPP loan during the first phase of the program that ran from February 15, 2020 to December 31, 2020.

The government alleged that in April 2020, Sunu P. KC applied for PPP loans through both KC Inc. and his former company, KC Investments Group, LLC, the latter of which was not operating at the time.  The government further alleged that in the loan applications, Sunu P. KC certified that KC Inc. would not receive multiple PPP loans, but both PPP loans were deposited into KC Inc.’s bank account.

As part of the resolution, KC Inc. and Sunu P. KC agreed to repay the second PPP loan within 30 days, together with the loan processing fee paid to the bank by the SBA, as well as an additional monetary amount pursuant to the False Claims Act and the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA).

The resolution obtained in this matter was the result of a coordinated effort between the U.S. Attorney’s Office for the Eastern District of Virginia and the SBA’s Office of General Counsel and Office of Inspector General.

The matter was investigated by Assistant U.S. Attorneys William Hochul and Kristin S. Starr.

SOURCE: USDOJ.Today