Paper company in Charlotte region to pay over $460,000 for false COVID loan paperwork
A paper converter company in the Charlotte region has agreed to pay more than $460,000 for providing false information to get COVID money, authorities said Thursday.
Taiji Group USA, Inc. in Conover violated the federal False Claims Act through the Personal Paycheck Protection program, said Lawrence Cameron, acting U.S. attorney for the Western District of North Carolina, in a statement. The PPP money from the Coronavirus Aid, Relief, and Economic Security Act of 2020 was intended to help businesses going through economic hardship during the pandemic.
Taiji Group USA received $254,415 from a PPP loan in May 2020. The company reported using it for 45 jobs, and the entire loan amount and interest was forgiven.
Congress approved another round of PPP loans for small businesses, nonprofits and venues in 2021. Borrowers were required to be truthful and accurate with information provided on the loan paperwork.
Taiji Group applied for a PPP loan in March 2021 and received $271,165 during the second round of funding, after reporting it was for 50 jobs. This loan and the interest was also forgiven.
But the U.S. Attorney’s Office says that the company knowingly submitted false information.
The business certified that no “entity created in or organized under the laws of the People’s Republic of China” owned or held 20% or more of the economic interest in Taiji Group. The company also certified that no member of its board of directors was a resident of China.
Both of these certifications were allegedly false, according to the feds. This made the company ineligible for the funding. After receiving the loan, Taiji Group sought and received forgiveness for the total amount.
Cameron said the U.S. Attorney’s Office is committed to holding businesses accountable for misusing funds.
“PPP loans were a lifeline for many businesses during the COVID-19 pandemic,” Cameron said in a news release. “Ineligible businesses that improperly obtained federal aid loans harmed the taxpayers who funded these programs and reduced the resources available for businesses that were eligible to receive assistance.”
Assistant U.S. Attorney Seth Johnson represented the government in the matter.
Sidesolve, a company that investigates corporate fraud, filed documents in the case in April under a whistleblower provision of the False Claims Act. The law allows private parties, called “relators,” to file complaints on behalf of the country for false claims and share in a portion of the government’s recovery, according to the U.S. Attorney’s Office.
About Taiji Group
The company founded Taiji Chemical Fiber Equipment LLC in 1994 with branches throughout China. Taiji Group USA became the first Chinese paper tube manufacturer in the U.S. It serves customers throughout the country and in Canada, Brazil, Argentina, Germany and China.
