A former medical practice in Upstate New York has agreed to pay $500,000 to settle allegations that it fraudulently obtained a pandemic relief loan it was not eligible to receive, the U.S. Attorney’s Office announced.
Lancaster Medical LLC of Depew received a Paycheck Protection Program loan of $249,290 in April 2020, fully guaranteed by the U.S. Small Business Administration. The government alleges the company violated the False Claims Act by falsely certifying its eligibility for the loan.
According to the U.S. Attorney’s Office, Lancaster Medical was ineligible because its assets had been sold in 2019, months before applying for the loan. The government contends the loan proceeds were used for personal expenses of the company’s former owners rather than permissible business purposes. After being informed the loan was not approved for forgiveness, Lancaster Medical did not repay it, authorities said…