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Herb Chambers, numerous of his companies, agree to pay $11.8 million for PPP loan fraud allegations

In an agreement to resolve False Claims Act allegations, Herb Chambers, several of his companies, and an officer of one of his companies are paying $11.8 million for Paycheck Protection Program (PPP) loan fraud allegations. In 2020, the United States Small Business Administration (SBA) passed an Interim Final Rule (IFR) that stated businesses apart of a single corporate group could not receive more than $20 million in PPP loans. The U.S. argues that the SBA's IFR applied to Chambers' companies and states that eight of the companies were not eligible for PPP loans because the SBA had already given $20 million to other businesses owned by Chambers. 'The Paycheck Protection Program was created to provide a financial lifeline to small businesses struggling to stay afloat during the unprecedented COVID crisis – not to serve as a funding mechanism for companies that sought to evade program limits,' said United States Attorney Leah B. Foley. In a settlement agreement, the eight companies applied for the PPP funding but had not yet received it by April 30, 2020 (when SBA published the IFR). A bank then canceled the unfunded loans due to the $20 million cap by the IFR. Several months later, the eight companies once again applied for the loans with a different bank, which funded the loans. 'When fraudulent applications wrongly drain a program set up to offset economic upheaval, it's a blow to the folks who truly need help. The FBI will continue to work with our partners to identify and investigate anyone who tries to defraud federal government programs in this way.' Said Jodi Cohen, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division Mr. Chambers and the companies cooperated during the investigation, taking Voluntary Disclosure, Cooperation, and Remediation into Account in False Claims Act Matters. Read the full settlement agreement here: Usa v. Herb Chambers - Settlement Agreement by Boston 25 Desk This is a developing story. Check back for updates as more information becomes available. Download the FREE Boston 25 News app for breaking news alerts. Follow Boston 25 News on Facebook and Twitter. | Watch Boston 25 News NOW