Ajinomoto Cambrooke, Inc., a company based in Ayer, Massachusetts, has agreed to pay $1,360,819.04 to resolve allegations that it violated the False Claims Act by obtaining a Paycheck Protection Program (PPP) loan for which it was not eligible.
The PPP was established as part of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), passed in March 2020 to help small businesses retain jobs and cover certain expenses during the COVID-19 pandemic. The program allowed for forgivable loans administered by the U.S. Small Business Administration (SBA). Eligibility depended on meeting size standards regarding the number of employees. On May 5, 2020, SBA guidance clarified that applicants must count all employees from both U.S. and foreign affiliates unless an exception applied.
According to the settlement agreement, Cambrooke admitted that it applied for a first draw PPP loan on or about May 15, 2020, certifying its eligibility under PPP rules. At that time, Cambrooke and its Japanese parent company exceeded the size standards required for eligibility but still received full forgiveness of the loan from the SBA.
The settlement takes into account Cambrooke’s cooperation with authorities under Department of Justice guidelines related to voluntary disclosure and remediation in False Claims Act cases.
This civil settlement also resolves claims filed under the qui tam provisions of the False Claims Act. These provisions allow private parties to bring actions on behalf of the United States and receive part of any recovery. In this case, “the relator will receive 10% of the settlement amount under today’s settlement.” The qui tam case is titled United States ex rel. Verity Investigations, LLC v. Ajinomoto Cambrooke, Inc., No. 25-cv-10220-RGS (D. Mass.).
U.S. Attorney Leah B. Foley and representatives from the U.S. Small Business Administration announced the resolution. Assistant United States Attorney Lindsey E. Weinstein managed the case for the Affirmative Civil Enforcement Unit.
