Battle Creek's own manufacturing firm, Bleistahl North America LP, is set to fork over a hefty sum upwards of $2.3 million to put to bed allegations that it applied for and received a second-draw Paycheck Protection Program (PPP) loan under false pretenses. The federal government claimed that Bleistahl didn't play by the rules which clearly stated that companies with more than 300 employees need not apply. The Justice Department announced this resolution, noting that the payment was determined based on the company's ability to pay.
Launched as a lifeline for small businesses smacked down by the pandemic back in 2020, the PPP aimed to keep firms afloat and workers paid. But Bleistahl, it seems, tried to slip through a loophole that the feds well and truly closed. The company snagged a second-draw loan of $1,300,305 in March 2021, fully forgiven later by the SBA—money that was supposed to only be in reach of businesses with under 300 employees. However, it's alleged that Bleistahl and its affiliates were too big to qualify, yet the company "falsely certified" otherwise on their application, according to Acting U.S. Attorney Alexis Sanford. "Businesses who did not meet the size standard were not entitled to Paycheck Protection Program funding," Sanford sternly pointed out, as noted by the Justice Department.
Underscoring the importance of integrity and compliance, Sanford and SBA General Counsel Wendell Davis are presenting a united front, with Davis adding that "the favorable settlement in this case is the product of enhanced efforts by federal agencies." The Justice Department's statement serves a double shot of deterrence and assurance that fraudulent funding will eventually be flushed out.
The resolution comes after a whistleblower lawsuit, U.S. ex rel. GNGH2 Inc. v. Bleistahl North America LP, which the government decided to support. Under the False Claims Act, the whistleblower will receive part of the settlement as a reward for exposing the issue. While some may see settlements like this as a light punishment compared to a trial, it's important to note that these were only allegations. No official finding of guilt has been made, according to the Justice Department.
