Three Chinese-owned real estate companies agreed to a $7,312,283.36 settlement over alleged false claims tied to Paycheck Protection Program loans, resolving whistleblower lawsuits and drawing a coordinated enforcement response from federal prosecutors and the SBA.
Federal authorities say Greenland LA Metropolis Hotel Development LLC, Greenland US Management LLC, and Greenland LA Metropolis Development III agreed to pay $7,312,283.36 to resolve allegations under the False Claims Act that they sought PPP loans for which they were not eligible. The civil settlement addresses claims that the firms submitted false certifications when applying for both first- and second-round PPP relief during the pandemic.
The department alleges the Greenland USA Entities certified eligibility they did not have, pointing to affiliation and size issues across related companies. Prosecutors contend that when affiliates in the U.S. and China are counted together, the combined workforce exceeded the SBA’s size standard for the industry, undermining the borrowers’ claimed qualifications.
Congress created the PPP in March 2020 to give emergency, forgivable loans to small businesses hit by COVID-19 economic disruption, with the Small Business Administration backing those loans. Rules required borrowers to certify eligibility and accuracy of information, and in January 2021 the SBA allowed certain recipients to apply for a second draw if they met program rules for repeat borrowers.
“Congress created the PPP to help American small businesses during the pandemic, not to fund large Chinese-owned corporations. Here, however, the defendants are alleged to have provided false information to the SBA to obtain government funds to which they were not entitled,” said U.S. Attorney Brad D. Schimel for the Eastern District of Wisconsin. “This settlement demonstrates that the U.S. Attorney’s Office takes seriously its obligation to combat fraud and protect American taxpayers.”
The United States also alleges the Greenland USA Entities were ineligible for second-round loans because they were more than 20 percent owned by entities created and organized in the People’s Republic of China. That ownership threshold is one of the criteria the government used to assess whether repeat PPP funding was appropriate for a borrower with foreign ties.
The Greenland USA Entities are part of a multinational enterprise ultimately owned by Greenland Holding Group Company Limited, a Chinese company with tens of thousands of employees worldwide. Federal filings say the U.S. entities develop and own real estate projects, and that their affiliations with a broad corporate family were central to the government’s ineligibility claims.
The civil settlement resolves claims brought under the qui tam whistleblower provisions of the False Claims Act, which let private parties sue on behalf of the United States and share in recoveries. Under the agreement, GNGH2 Inc. will receive $697,757.80 and Aidan Forsyth will receive $33,470.53 from the total recovery for their roles as relators in two related qui tam suits.
The resolution was the product of a coordinated effort among the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the Eastern District of Wisconsin, with assistance from the SBA’s Office of General Counsel and Office of the Inspector General. Trial Attorney Lindsey Roberts of the Civil Division and Assistant U.S. Attorney Michael Carter for the Eastern District of Wisconsin handled the matter.
