Zurik: New Orleans company receives $180,000 PPP loan and likely had no employees
NEW ORLEANS (WVUE) - A New Orleans company, applied for and received a Paycheck Protection Program loan of nearly $200,000, but a FOX 8 Investigation found that at the time of the application, the company likely had no employees on staff.
The Paycheck Protection Program (PPP), administered by the Small Business Administration, has distributed $800 Billion in relief for businesses struggling during the COVID-19 pandemic to keep paychecks going to affected employees.
In April 2020, Story Block Media, a New Orleans-based marketing company, applied for and received $184,000 in PPP money to retain seven jobs. According to the Louisiana Secretary of State’s Office, the owner of the company is Dennis Lomonaco.
Jec Caulfield knows Story Block Media was not operating at the time of the April application because Lomonaco and his Story Block employees were on the payroll at NOLA Motorsports Park, where she worked.
Caulfield said shortly after Lomonaco took the job of general manager at the park, all of the Story Block Media employees rolled over to the motorsports payroll.
“So we [NOLA Motorsports Park] absorbed their entire staff, they ended up coming to work for the park,” she said.
FOX 8 confirmed with two other sources that those employees were paid by NOLA Motorsports and not Story Block Media.
The Story Block Media website has eight employees listed. We searched LinkedIn for each employee’s profile and found the employees listed on the website were not working for the company at the time of the PPP application.
We reached Lomonaco by phone who said he followed all rules to receive the PPP money. FOX 8′s Lee Zurik then detailed our findings to Lomonaco, noting that Story Block promised the SBA it would retain seven employees and noting that all eight listed employees appear to have left the company before he applied for the PPP money. When asked for any information that shows Story Block had seven employees or another explanation how the company could have qualified for the money, Lomonaco responded, “Thanks for sending this over, but I do not have any comments.”
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Jec Caufield said she thinks Story Block receiving PPP funding was not fair since they “didn’t have a company at the time.”
“You [Lomonaco] were full-time with us. You were running our operations, embedded in our marketing,” she said.
What FOX 8 uncovered is “very serious” according to Tulane Law Professor Joel Friedman.
“When the FBI finds out about this, which they will when you air this, they’re gonna go after him,” Tulane Law Professor Joel Friedman said.
Friedman said what makes this case potentially worse is the money was supposed to help businesses across the country fighting to survive during the COVID-19 Pandemic. Instead, one New Orleans businessman might have improperly used the program to receive taxpayer money he didn’t qualify for.
NOLA Motorsports Park said they had no involvement in the PPP loan and application for Story Block Media. NOLA Motorsports Park released the following statement:
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