The U.S. Attorney’s Office for the District of Columbia has reached settlements with four non-profit organizations over alleged misuse of the Paycheck Protection Program (PPP). According to a press release, the League of United Latin American Citizens (LULAC), the National Bureau of Asian Research, the National Conference on Public Employee Retirement Systems (NCPERS), and Prosperity Now will collectively pay more than $3 million to resolve claims of false certification of PPP loan eligibility.
Under the settlements, LULAC, the largest Hispanic civil rights organization in the U.S., will pay $312,272.60 after receiving two PPP loans totaling $164,354. The National Bureau of Asian Research, which focuses on policy related to Asia, agreed to a settlement of $475,000 plus interest following a second-draw PPP loan of $411,111. The settlements address allegations that the organizations violated the False Claims Act under the CARES Act, which was designed to support small businesses and entities affected by the pandemic.
NCPERS, which represents public sector retirement systems, will pay $457,562 to resolve claims after receiving two PPP loans totaling $261,464. Prosperity Now, a non-profit advocating for policy changes at various government levels, settled for $2,081,523.15 plus interest related to a second-draw PPP loan of $1,532,800. The investigations were led by Assistant U.S. Attorney Sean M. Tepe and Auditor Timothy C. Hurley following the initial complaints.
The settlements highlight cases where organizations ineligible for PPP loans—such as Section 501(c)(4) entities or those primarily engaged in political or lobbying activities—obtained and even sought forgiveness for these funds. Captain Caitlin J. Kelly and Kandace Zelaya of the U.S. Small Business Administration’s Office of the General Counsel were recognized for their roles in the investigations, which reinforced the importance of compliance with funding eligibility rules. Suspected fraud can be reported to the Department of Justice’s National Center for Disaster Fraud Hotline or submitted via their online complaint form.
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