The Strand, an iconic New York City bookstore owned by Nancy Bass Wyden, the wife of Oregon Democratic Senator Ron Wyden, has agreed to pay nearly $1.5 million in a civil settlement for accepting a Paycheck Protection Program (PPP) loan it was ineligible to receive [1]. The store applied for a $932,350 second-draw PPP loan in February 2021 and certified on the application that "the spouse of a Member of Congress does not directly or indirectly hold a controlling interest in the applicant," a statement that the U.S. Attorney's Office determined was "knowingly and materially false" [1].
The settlement amount of $1,482,560 was reached under the False Claims Act, which allows the government to recover more than its actual losses based on reckless disregard [1]. Congress had prohibited second-draw PPP funds for businesses in which a member of Congress or their spouse held a controlling interest through legislation passed in December 2020 [1]. The Strand claimed the application error was unintentional, stating that "the bookstore's accountant and the bank administering the loan were not aware of this change when the second-draw application was processed" [1].
The civil settlement resolved a qui tam lawsuit filed by corporate entity Blockquote Inc., which allows private whistleblowers to sue on behalf of the U.S. government and receive a portion of recoveries [1]. Blockquote will receive approximately $148,256 from the settlement, with the lawsuit docket remaining sealed from public view [1]. Notably, the settlement included no determination of liability by the store, according to the U.S. Attorney's Office in Washington, D.C. [1].
CONCLUSION
The Strand bookstore's $1.5 million PPP loan settlement represents enforcement action against a high-profile business for violating congressional restrictions on loan eligibility tied to political connections. While the store characterized the violation as an unintentional mistake by its accountant and lender, the settlement underscores ongoing government scrutiny of PPP loan compliance and the False Claims Act's application to pandemic relief programs.