The U.S. Attorney’s Office for the Southern District of New York has reached a settlement with TCC International LLC, Core Gravity LLC, and Core Club Members Corp. regarding allegations that the companies fraudulently obtained federal COVID-19 relief funds. The lawsuit claimed that these defendants falsely certified their eligibility for two Paycheck Protection Program (PPP) loans and a Restaurant Revitalization Fund (RRF) grant, in violation of the False Claims Act.
According to federal regulations, private clubs were not eligible to receive PPP loans, and restaurants that did not primarily serve the public or were not-for-profit could not receive RRF grants. The government alleged that TCC International LLC and Core Gravity LLC used PPP funds to operate a private club, while Core Club Members Corp., a not-for-profit entity without public food or beverage sales, received an RRF grant despite being ineligible.
Under the terms of the settlement approved by U.S. District Judge Mary Kay Vyskocil, the defendants will pay $360,000 to resolve the claims. This amount was determined based on financial information provided by the defendants about their ability to pay. They have also signed a Consent Judgment totaling $8,189,172.10 which may be enforced if they fail to make required payments under the agreement. Additionally, they have admitted and accepted responsibility for their conduct as described in the government’s complaint.
U.S. Attorney Jay Clayton stated: “The Paycheck Protection Program and Restaurant Revitalization Fund were intended to assist small businesses suffering the financial impacts of a pandemic-related lockdown,” said U.S. Attorney Jay Clayton. “New Yorkers supported these programs to protect their neighbors and their community. New Yorkers also want those who abused the programs held accountable. Our Office and the SBA are committed to doing so.”
SBA-OIG Special Agent in Charge Amaleka McCall-Brathwaite added: “Falsely certifying eligibility for Paycheck Protection Program loans and Restaurant Revitalization Fund grants undermines critical relief programs designed to support small businesses and public-facing restaurants,” said SBA-OIG Special Agent in Charge Amaleka McCall-Brathwaite. “OIG remains dedicated to protecting the integrity of SBA’s programs and holding accountable those who exploit them for personal gain.”
Court documents detail how TCC International LLC d/b/a Core Gravity applied for a first-draw PPP loan of $960,400 by certifying its eligibility when it was actually operating as a members-only club—making it ineligible under program rules—and used those funds accordingly. Partial forgiveness was sought on this loan through false certification that costs were eligible.
Similarly, TCC International LLC d/b/a The Core Club applied for a second-draw PPP loan of $1,344,675.50 under false pretenses and obtained full forgiveness after again misrepresenting how funds would be used.
Core Club Members Corp., meanwhile, applied for an RRF grant exceeding $2.3 million as a not-for-profit organization with no sales to the public—criteria that made it ineligible under RRF rules—but still received funding.
As part of resolving these allegations, all three entities acknowledged responsibility for making false certifications about their eligibility for pandemic relief funds.
The government joined an existing whistleblower lawsuit filed under seal pursuant to the False Claims Act as part of this case.
Assistant U.S. Attorney Jessica F. Rosenbaum from the Civil Frauds Unit is handling this matter.
