Evergreen Reporter

Campbell Sales Group, Inc., operating under the name LeatherItaliaUSA, has agreed to pay $1,499,164 to resolve its criminal liabilities regarding a Paycheck Protection Program (PPP) loan scheme. This agreement includes restitution and penalties, alongside taking on further responsibilities.

The PPP was introduced by Congress in March 2020 as part of the CARES Act to assist small businesses during the COVID-19 pandemic. Loans under PPP were fully guaranteed by the United States and were forgivable if used for payroll and authorized expenses. A minimum of 60 percent of the loan proceeds needed to be spent on payroll to qualify for forgiveness.

CSG, a leather furniture supplier based in Leland, North Carolina, obtained a $257,700 PPP loan in April 2020. As per the settlement, CSG admitted to fraudulently inflating its payroll to meet forgiveness criteria. The company added names to its payroll, reported wages for them, yet none were actual employees nor received salaries. They also increased legitimate employees' wages without the wages being retained by those employees.

In October 2020, CSG submitted a loan forgiveness application that inflated payroll numbers. The figures incorporated the "ghost wages" and overstated wages, accompanied by false supporting documentation provided to the lender. The loan was fully forgiven in May 2021.

CSG sought a subsequent PPP loan in March 2021 amounting to $213,006, using the same false figures for wages as the initial loan.

Under the criminal settlement terms, Campbell Sales Group agreed to a prosecution deferral period of three years, during which they are prohibited from committing further offenses.

Daniel P. Bubar, Acting U.S. Attorney for the Eastern District of North Carolina, announced the settlement, which was accepted by U.S. District Judge Louise W. Flanagan. The United States Secret Service conducted the investigation, and the case was prosecuted by Assistant U.S. Attorney Adam F. Hulbig.

Further details and related documents are accessible through the U.S. District Court for the Eastern District of North Carolina or via PACER by referring to Case No. 7:25-CR-14-FL.