6 VA Nonprofits Ineligible For COVID-19 Loans: Whistleblower Lawsuit

Six Virginia nonprofits paid a combined $1,381,646 on Tuesday to settle fraud accusations for receiving COVID-19 pandemic funding for which they were ineligible, according to court records.

An investigation by Assistant U.S. Attorney John Beerbower and former Assistant U.S. Attorney Gina Kim determined that each of the following nonprofits were not eligible for the Paycheck Protection Program loans they received during the pandemic, because they were 501(c)(4) entities, according to court records:

• Employee Activity Association located in McLean
• National Association of Telecommunications Officers and Advisors, Alexandria,
• Mid-Eastern Athletic Conference, Norfolk,
• Cheers, Richmond,
• Metropolitan Business League, Richmond
• Southampton Recreation Association, Richmond

The settlement started out as a lawsuit filed under the whistleblower provision of the False Claims Act, which allows private parties to file suit on behalf of the U.S. for false claims presented to the federal government, according to a release.

One of the provisions of the False Claims Act is that a whistleblower who files a lawsuit on the federal government's behalf receives a share in the money the government receives from the settlement. In this case, the whistleblower received 10 percent of the $1,381,646 settlement, which is approximately $138,165.

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