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Monday, January 24, 2022

Former Queen Mary operators fined $2.4 million over alleged PPP loan scam

A Delaware bankruptcy court judge recently ruled, two former Queen Mary operators will have to pay fines of $250 a day starting in January unless they can clear the $2.4 million in missing federal COVID-19 relief funds. cannot cover.

Judge Christopher Sonchi, in his ruling earlier this month, called Taylor Woods and Howard Wu “fraudsters,” accusing them of absconding with $2.4 million in Paycheck Protection Program funds.

Lawyers for both did not return requests for comment.

Court documents show that a US bankruptcy court judge ruled in mid-November after contempt of court for failing to provide an accurate representation of its finances to Woods and Wu of Urban Commons.

14 ruling, which was first reported by the Long Beach Post, requires the pair to pay $250 per day until they can come up with $2.4 million – or until they are not able to provide an accurate representation of their finances and how they spent PPP loan funds, court records said.

“One would have thought that issuing the contempt order and restraining order would serve to make it clear to Mr. Woods and Mr. Wu that continued fraudulent behavior would not be tolerated by the Court and that it was time to make a full and clear accounting, “The court documents read. “Clearly, the defendants have not received the message.”

Urban Commons initially sued the pair, saying they took $2,437,500 in government relief funds for the company, court records showed.

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Court documents showed that the judge said his testimony was inconsistent and fraudulent when he was unable to post $2.4 million. Sonchi held him in contempt in November because he could not account for the money or how it was used.

The former Queen Mary operators filed for bankruptcy earlier this year and were charged with fraud by a city auditor. Control of the city was given back to the Queen Mary for the first time in 40 years after Urban Commons surrendered its 66-year lease.

The city voted in September to give control of the Queen Mary to the Ports Commission. The World War II-era old ship was in need of repairs for up to $20 million, which Urban Commons failed to address as part of its lease agreement with the city, the city argued in the court filing.

Court filings also show that Urban Commons was unable to account for another $23 million, the city said. After the city gave Urban Commons money to fix the ship in 2016, a recent city audit found that the Queen Mary was still in need of those “critical repairs”.

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