Emmanual David, False Claims Act Violation, California 2021

Unified Care Services LLC, a Torrance-based skilled nursing facilities chain and its affiliates, have agreed to pay a whopping $18 million to resolve allegations that they provided false information in support of Paycheck Protection Program (PPP) loan applications.

According to the charges, Unified Care and its affiliates knowingly provided false information, certifying that they were small businesses with fewer than 500 employees when, in fact, they were part of a larger chain of facilities sharing common ownership and control. This rendered them ineligible for PPP loans.

PPP loans were intended to support small businesses struggling to pay employees and other business expenses during the COVID-19 pandemic. Borrowers were eligible to seek forgiveness of the loans if they spent the loan proceeds on employee payroll and other eligible expenses. However, Unified Care and its affiliates allegedly failed to disclose this information, resulting in the misappropriation of taxpayer funds.

The settlement resolves allegations that Unified Care Services LLC, its affiliates, and owner Emmanual David knowingly violated the False Claims Act (FCA) by providing false information in support of PPP loan applications and loan forgiveness applications submitted by the company.

This resolution demonstrates the department’s commitment to ensuring that those who improperly obtain federally guaranteed PPP loans are held accountable and funds repaid to the American taxpayer, said Director of COVID-19 Fraud Enforcement Mandy Riedel of the Justice Department.

The settlement was reached as a result of a lawsuit filed under the qui tam or whistleblower provisions of the False Claims Act. The lawsuit, United States ex rel. Ashwani Chawla v. Unified Care Services et al., CV 21-5935-GW (CDCA), allowed private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery.

The SBA Office of Inspector General is committed to ensuring the integrity of CARES Act programs, said Special Agent in Charge Weston King of the SBA Office of Inspector General, Western Region. Through partnerships with federal agencies, we continue to identify fraud schemes and protect relief funds from misuse.

Unified Care Services LLC and its affiliates must now face the music for their alleged crimes. The $18 million settlement serves as a stark reminder of the consequences of falsifying PPP loans.

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