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Morris County Tour Company Settles False Claims Act Case Over Improper PPP Loans
CIE Tours International agrees to pay over $4.4 million after receiving and seeking forgiveness for COVID-19 relief loans it was ineligible to obtain under federal guidelines.
MORRISTOWN, N.J. — A Morris County-based tour company has agreed to pay $4.43 million to settle allegations that it improperly received and had forgiven two Paycheck Protection Program (PPP) loans for which it was ineligible, federal authorities announced.
CIE Tours International Inc., located in Morristown, entered into a civil settlement with the United States to resolve claims brought under the False Claims Act, a federal statute that allows for liability when individuals or companies defraud government programs. The matter involved a whistleblower lawsuit filed in the District of New Jersey and stemmed from allegations that CIE Tours violated PPP eligibility rules during the COVID-19 pandemic.
According to the complaint and settlement terms, CIE Tours obtained two PPP loans totaling $3,410,300—despite being ineligible for the relief. The company was allegedly ineligible both because it is owned by the government of Ireland and because it exceeded the employee size limits set forth in the CARES Act, which established the PPP in March 2020 to help small businesses keep workers employed during the pandemic.
The company later sought and obtained forgiveness for the full amount of the loans.
Whistleblower and Settlement Details
The case was brought under the qui tam (whistleblower) provisions of the False Claims Act. This allows private individuals or entities to sue on behalf of the federal government and share in any recovery. The relator in this case, identified as TZAC, Inc., will receive $428,985 as their share of the settlement.
Although the government contended the loans were wrongfully obtained, CIE Tours cooperated fully with the investigation, which helped bring the matter to a civil resolution without the need for protracted litigation.
Federal Oversight and Enforcement
Senior Counsel Philip Lamparello credited the U.S. Small Business Administration’s Office of General Counsel for its role in the investigation. Assistant U.S. Attorney David E. Dauenheimer of the Healthcare Fraud and Opioids Enforcement Unit in Newark represented the government in the matter.
The case is part of broader federal efforts to investigate misuse of emergency COVID-19 relief programs, including the PPP, which was authorized under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The PPP provided billions of dollars in forgivable loans to help small businesses cover payroll and operating expenses during the height of the pandemic.
The qui tam lawsuit was filed under the caption U.S. ex rel. TZAC, Inc. v. CIE Tours International, Case No. 24-cv-009637 (D.N.J.).
Anyone with information regarding suspected fraud involving COVID-19 relief programs is encouraged to contact the National Center for Disaster Fraud via its hotline at 866-720-5721 or through the online complaint form at justice.gov/disaster-fraud.
