Carson Tahoe Health System settles federal loan whistleblower case for $8.9 million
A regional medical center in Carson City has agreed to pay $8.9 million to the federal government to settle a case in which a whistleblower claimed it was not eligible to receive pandemic era loans, federal prosecutors said Monday.
Carson Tahoe Health System did not admit liability in the case, but will pay back $7.3 million in loans it obtained in 2020 and 2021 plus additional fees as part of the federal Paycheck Protection Program, which was meant to support businesses during the COVID-19 pandemic.
“This settlement returns millions of taxpayer dollars to the government and reflects our ongoing commitment to enforce the requirements of the Paycheck Protection Program and ensure that only eligible businesses received this critical pandemic relief,” Acting U.S. Attorney Michele Beckwith said in a press release on Monday.
The Nevada health system was ineligible for the loans, Beckwith said, because it was too large to meet the size requirements for assistance under the program.
The health system acknowledged the settlement in a statement emailed to The Sacramento Bee. But the nonprofit did not admit wrongdoing.
“While we maintain that we applied for and used these funds in good faith during an unprecedented crisis, we have chosen to resolve this matter to avoid the uncertainty and expense of prolonged litigation,” the statement said.
The whistleblower lawsuit is one of many filed by private investigators or corporations empowered to do so by a law aimed at preventing fraud against the federal government. Under the law, whistleblowersm known as relators, can file lawsuits claiming fraud even if they don’t work at the company that they are accusing. And they are entitled to a portion of the proceeds if the case succeeds.
In this case, the relator was a private corporation called GNGH2, court documents show. The company, which is incorporated in New Jersey and run by principal David Abrams, will receive about $770,000 of the proceeds from the settlement, the agreement shows.
The settlement was signed by Katie Kucera, the health system’s chief financial officer, Assistant U..S. Attorney Tara Amin and Abrams in January. U.S. District Judge Kimberly J. Mueller ruled on March 12 that the federal government had the authority to enforce the settlement, ending the case on that day.
This story was originally published March 24, 2025 at 3:50 PM.
