Businesses, owner consent to $850,000 judgment to resolve COVID-19 fraud allegations
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The following is a news release from U.S. Attorney’s Office (Idaho).
BOISE — Brett Deuter and his businesses, Deuter Construction, LLC, and Enlighten, LLC, consented to an $850,000 judgment against them in United States District Court after admitting to violations of the False Claims Act, U.S. Attorney Josh Hurwit announced.
The fraud perpetrated by Deuter involved misappropriating funds from two different COVID-19 Relief Programs: the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) program.
In the consent judgment, Deuter admitted that Deuter Construction no longer had employees or operations at the time that it applied for PPP funds. Deuter further admitted that the recipient of the PPP funds – Enlighten, LLC – was ineligible to receive funds because it was not in operation prior to the COVID-19 pandemic. Deuter also admitted to falsely stating the PPP loan was exclusively used for payroll and other covered expenses when, in fact, some of the funds were used to cover Deuter’s personal expenses, including personal credit card debt and gambling expenses in Las Vegas, Nevada.
Additionally, Deuter admitted to recklessly making false statements in an application for EIDL funds. Deuter falsely claimed that the EIDL funds would be used as working capital to alleviate economic injury caused by the pandemic. Instead, Deuter used the EIDL funds to pay personal and business debts incurred before the pandemic started. Deuter also admitted that EIDL funds were used to purchase real property in Hailey, Idaho.
“Fighting COVID-19 relief fraud has been, and will continue to be, a priority for my office,” said U.S. Attorney Hurwit. “We will continue to bring to justice those individuals and companies who seek to obtain taxpayer funds through fraudulent schemes or illegal practices.”
This judgment includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Stuart Hallam. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. Mr. Hallam will receive approximately $161,500 as his share of the total settlement.
“This outcome demonstrates our unwavering commitment to ensuring relief funds provided through the PPP and EIDL programs are used for their intended purposes,” said SBA OIG’s Western Region Special Agent in Charge Weston King. “The unauthorized use of these funds for personal expenditures undermines the integrity of these programs. The whistleblower award serves as a tool to bring more whistleblowers forward. This result would not have been possible without the qui tam relator and the hard work of our dedicated law enforcement partners.”
This matter was investigated jointly by the U.S. Attorney’s Office for the District of Idaho and the Small Business Administration, Office of Inspector General. Assistant U.S. Attorney Elliot Wertheim handled this case.