On Tuesday, August 4th, the Chinese company Jushi, which manufactures and sells fiberglass, reached a settlement with the Department of Justice through its U.S. subsidiary in South Carolina, ending allegations of fraudulently obtaining pandemic relief loans.
According to the federal prosecutor in New Jersey handling the case, from July 2020 to June 21, 2021, the Jushi subsidiary in the U.S. applied for and received a total of $3.59 million in loans, including interest, through the Paycheck Protection Program (PPP) and loan forgiveness. The company was aware that its size exceeded the eligibility criteria for the program, thus violating the False Claims Act.
The U.S. federal government established the PPP relief program in March 2020 to support small and medium-sized businesses during the COVID-19 pandemic to maintain operations and continue paying employee salaries. The program stopped accepting new applications on May 31, 2021.
Prosecutors alleged that the size of Jushi’s U.S. subsidiary exceeded the standards set for small and medium-sized businesses in the program, but knowingly made false certifications of eligibility or induced others to make false statements in order to obtain PPP loans. Additionally, the company also made false statements in its loan applications.
Under the terms of the settlement agreement, the Jushi U.S. subsidiary has paid over $5.08 million to the U.S. government.
This lawsuit originated from a whistleblower. Prosecutors stated that the informant who provided the information to the government will receive a 10% share of the recovered funds, which amounts to approximately $50,000.
The U.S. Department of Justice noted that they have been pursuing both civil and criminal actions against companies and individuals engaging in fraudulent practices to obtain PPP loans.
In 2025, the U.S. Department of Justice previously announced three settlement cases involving Chinese company subsidiaries in the U.S. accused of fraudulently obtaining PPP loans, thereby violating the False Claims Act.