An auto parts manufacturer in St. Marys, Ohio has agreed to pay $3,039,615, including $1,085,577 in restitution, to settle allegations that it misrepresented its employee count to qualify for Paycheck Protection Program loans and then again to get those loans forgiven. The company, Murotech Ohio Corporation, is accused of certifying numbers that left out employees at related businesses, pushing its real headcount above the program's limits.
Two Applications, Two Alleged Undercounts
According to hometownstations.com, Murotech Ohio is an automotive component parts manufacturer with its principal place of business in St. Marys, Ohio, and operates as a subsidiary of Japan-based Muro Corporation. The company's first PPP application, submitted in May 2020, certified that it had fewer than 500 employees, even though that total exceeded 500 once affiliated entities were counted, the outlet reported.
A second application followed in January 2021, this time certifying fewer than 300 employees. Per the same hometownstations.com report, that figure also exceeded the program's limit once affiliates were factored in. The Paycheck Protection Program, launched by the Small Business Administration, was designed to give eligible companies financial support during the COVID-19 pandemic, with employee-count thresholds determining which businesses qualified and under which terms.
Forgiveness Applications Also Under Scrutiny
Murotech didn't stop at securing the loans. As reported by limaohio.com, the company applied to have both federal loans forgiven and again certified on those applications that its employee numbers fell below program limits. Under SBA guidance, it was the borrower's own responsibility to determine which entities counted as affiliates and to calculate the combined employee headcount accordingly, with lenders permitted to rely on those certifications, according to the U.S. Small Business Administration.
It's important to note that the claims resolved by the settlement are allegations only, and liability was not determined, the article notes. Murotech agreed to the payment without an admission of wrongdoing being established through litigation.
Whistleblowers Share in the Recovery
The settlement resolves two lawsuits filed under the whistleblower provisions of the False Claims Act, which allow an individual to file a complaint on behalf of the United States and share in any government recovery. The two cases were United States ex rel. GNGH2, Inc. v. Murotech Ohio Corporation, case number 3:24-CV-1592, and United States ex rel. Verity Investigations, LLC. v. Murotech Ohio Corporation, case number 3:24-CV-2245, the station's report states.
Each relator will receive $151,980.75 under the deal. The resolution came through a coordinated effort by the U.S. Attorney's Office for the Northern District of Ohio, with assistance from the SBA's Office of General Counsel. Assistant United States Attorney Angelita Cruz Bridges handled the matter for the Northern District of Ohio, per the same account.
Part of a Broader Reckoning Over PPP Fraud
Murotech's case lands amid wider scrutiny of pandemic-era lending. The Cato Institute said in 2023 that there was a clear failure of federal oversight for the PPP during the pandemic, according to justthenews.com, citing the Cato Institute. Nationally, the stakes for companies caught up in these disputes have been substantial: the U.S. Department of Justice reported that settlements and judgments under the False Claims Act exceeded $6.8 billion in the fiscal year ending September 30, 2025.
Murotech isn't the only manufacturer to face this kind of allegation. In a separate matter, American Plastics LLC agreed to pay $2.25 million following the improper receipt of a PPP loan, in a settlement that resolved a lawsuit filed under the qui tam, or whistleblower, provisions of the False Claims Act, according to the Department of Justice.
The Highland County Press, which first reported on the settlement announcement, noted that people with information about PPP fraud allegations may submit a report to the SBA Office of the Inspector General. Readers can find the original announcement via The Highland County Press.
