Durst Image Technology US LLC, a Rochester-based company, has agreed to pay $1.8 million to settle allegations that it improperly obtained Paycheck Protection Program (PPP) loans for which it was not eligible. The announcement was made by U.S. Attorney Michael DiGiacomo.
The PPP was created by Congress in March 2020 to help American businesses manage the economic challenges caused by the COVID-19 pandemic. It offered forgivable loans guaranteed by the U.S. Small Business Administration (SBA) to qualifying small businesses. One of the requirements for a second draw PPP loan was that applicants generally needed to have 300 or fewer employees, including those of any foreign affiliates.
According to the United States, Durst received a forgiven PPP loan despite exceeding this employee limit. At the time Durst applied for its second draw PPP loan in 2021, it was wholly owned by Durst Group AG, an Italian company with multiple subsidiaries worldwide. Combined, Durst Group AG and its affiliates employed more than 300 people.
“PPP was designed to support small business during the COVID-19 Pandemic,” said U.S. Attorney DiGiacomo. “When companies fail to comply with the size and eligibility rules, this office is committed to recovering taxpayer dollars that were improperly obtained and spent.”
The settlement resolves claims under the qui tam or whistleblower provisions of the False Claims Act. These provisions allow private individuals—referred to as relators—to file actions on behalf of the United States and receive part of any recovery. In this case, United States ex rel. GNGH2 Inc. v. Durst Image Technology US LLC, 24-cv-6185 (W.D.N.Y.), the relator will get a share of the settlement.
Assistant U.S. Attorney David M. Coriell and USAO Investigator Margaret McFarland managed this matter with help from SBA’s Office of General Counsel.
People who have information about possible fraud related to COVID-19 are encouraged to report it through the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or online at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
The settlement resolves only allegations; there has been no finding of liability.
