IBEW Local 103 Hit with $2M PPP Fraud Settlement

BOSTON – A powerful Boston labor union, the International Brotherhood of Electrical Workers Local 103 (IBEW Local 103), is shelling out a hefty $2,033,205 to settle allegations of blatant fraud related to Paycheck Protection Program (PPP) loans. The Dorchester-based 501(c)(5) nonprofit admitted to jumping the gun and securing a loan it wasn’t entitled to, then doubling down with a second, equally suspect application.

According to federal prosecutors, IBEW Local 103 first dipped its hands into the PPP pot in April 2020 – before Congress even opened the door for unions to participate. When the rules finally changed in March 2021, allowing unions to apply, they grabbed another loan. But here’s the kicker: the union falsely certified they’d already spent the money from the first loan, a prerequisite for securing a second. Had they waited until March 2021 to apply initially, they wouldn’t have needed to pull this stunt.

This wasn’t just a paperwork error. The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), passed in March 2020, was meant to be a lifeline for those genuinely struggling during the pandemic. The PPP, administered by the Small Business Administration (SBA), offered forgivable loans to businesses that kept workers on the payroll. But the program had rules, and IBEW Local 103 deliberately skirted them. 501(c)(5) organizations like this union were initially excluded, making their early application a clear violation.

The feds weren’t asleep at the wheel. While the details of the initial tip remain under wraps, investigators uncovered the scheme and brought the hammer down. However, IBEW Local 103 did receive some credit for voluntarily coming forward and cooperating with the Department of Justice. That doesn’t erase the fraud, but it did likely lessen the blow.

United States Attorney Leah B. Foley made it clear this isn’t just about the money. It’s about accountability. “Fraudulent claims like these undermine the integrity of programs designed to help those most in need,” she stated. Assistant U.S. Attorney Brian M. LaMacchia, head of the Affirmative Civil Enforcement Unit, spearheaded the case. The U.S. Small Business Administration also played a key role in the investigation.

This settlement sends a message: even powerful unions aren’t above the law. While $2 million is a significant sum, it’s a drop in the bucket compared to the damage done to the PPP program and the trust of the American people. The Grimy Times will continue to follow this case and expose those who exploit federal programs for personal gain.