Leland furniture supplier to pay nearly $1.5 million over PPP loan fraud
BRUNSWICK COUNTY, NC (WWAY) — A Leland-based furniture company has agreed to pay nearly $1.5 million in restitution and penalties for fraudulently obtaining and seeking forgiveness for Paycheck Protection Program (PPP) loans, federal prosecutors said.
According to the U.S. Department of Justice, Campbell Sales Group, Inc., doing business as LeatherItaliaUSA, admitted to inflating payroll figures in order to meet loan forgiveness requirements under the PPP, a COVID-19 relief program established by Congress in 2020.
The DOJ said CSG received a $257,700 loan in April 2020. After receiving the funds, the company falsely claimed to have added employees and increased wages—when in fact, some individuals listed on the payroll didn’t work for the company and never received payment.
Prosecutors said the company also boosted wages for current employees but required them to return the money, further inflating payroll numbers without actually increasing compensation.
In October 2020, CSG submitted a loan forgiveness application using the fabricated payroll costs. The loan was fully forgiven in May 2021. The DOJ said the company repeated the scheme when applying for a second PPP loan of $213,006 in March 2021, again using false payroll data.
Under the terms of a criminal settlement, CSG will pay $1,499,164 in restitution and penalties and will be subject to a three-year prosecution deferral. During that period, the company must avoid any further legal violations and comply with other terms of the agreement.
