A software company and a robotics business, both headquartered in San Francisco, have agreed to pay a total of $6.8 million to settle allegations they violated the rules of federal Paycheck Protection Program loans, prosecutors said.
The companies are IGEL Technology Corp., a multinational software company, and SoftBank Robotics America, Inc., a unit of Japanese multinational investment holding company SoftBank Group Corp., according to the U.S. Attorney’s Office for Northern California.
IGEL will pay $3,168,901.75 and SoftBank Robotics America will pay $3,637,499.09 to settle allegations they knowingly violated the False Claims Act when they received and retained PPP loans, prosecutors said Thursday.
The loans were created in March 2020 to provide emergency financial support during the COVID-19 pandemic. Forgivable loans were intended for small businesses struggling to pay employees and other business expenses.
Prosecutors said IGEL’s North American affiliate claimed to have only 105 employees when it applied for a PPP loan in June 2020 and SoftBank Robotics America claimed to have only 16 employees when it applied in March 2021.
Both sought and received forgiveness for the loans when, in reality, the companies exceeded the size standards when including affiliated entities, plus their multinational parent companies.
The settlements resolve claims brought under whistleblower provisions of the False Claims Act by Verity Investigations, LLC. Under those provisions, a private party can file an action on behalf of the U.S. and receive a portion of any recovery.
Verity Investigations will receive $316,890.17 in connection with the IGEL settlement and $363,749.91 in connection with the SoftBank settlement, prosecutors said.