Avingtrans Subsidiaries Settle Fraud Allegations for $4.8M
Energy Steel & Supply and Hayward Tyler resolve False Claims Act allegations regarding ineligible PPP loans.
Updated on Oct. 27, 2026 in Financial Crime
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Energy Steel & Supply, Co. and Hayward Tyler, Inc. have agreed to pay $4.77 million to settle allegations that they violated the False Claims Act. The government alleged that the subsidiaries of Avingtrans, PLC knowingly obtained ineligible Paycheck Protection Program loans by misrepresenting their employee counts.
Why it matters
The settlement addresses claims that the companies exceeded the 300-employee threshold required for program eligibility. It highlights the ongoing enforcement efforts by the United States to recover funds from entities that improperly accessed Covid-19 relief capital.
The civil settlement resolves a qui tam lawsuit filed under the False Claims Act in the Eastern District of Michigan. A whistleblower will receive 10 percent of the $4.77 million total settlement amount for their role in the recovery.
The players
Energy Steel & Supply, Co.
This company is a subsidiary of Avingtrans, PLC that was found to have violated the False Claims Act.
Hayward Tyler, Inc.
This entity is an Avingtrans, PLC subsidiary that participated in the procurement of ineligible government loan funds.
Avingtrans, PLC
Based in the United Kingdom, this organization serves as the parent company for both firms involved in the settlement.
Small Business Administration
This federal agency is responsible for providing support to small businesses and managed the Paycheck Protection Program loans.
The details
The companies allegedly secured second draw loans in February 2021 despite foreign ownership and workforce size constraints. The case was brought to light through a qui tam lawsuit, captioned United States ex rel. GNGH2, Inc. v. Energy Steel & Supply Co., et al., which allows private parties to sue on behalf of the government.
Timeline
Congress created the Paycheck Protection Program in March 2020.
The companies obtained second draw loans in February 2021.
The settlement of the fraud allegations was announced on October 27, 2026.
Legal Context
This settlement follows the pattern established by the False Claims Act in the recovery of government funds from companies that provided false statements during the pandemic. Such cases are frequently utilized in the Eastern District of Michigan to pursue corporate accountability for misuse of federal relief programs.
The settlement ensures that federal funds intended for small businesses are reclaimed from entities that did not meet the necessary criteria. Residents can report potential misuse of government aid through official channels to aid in future investigations.
The takeaway
Companies must strictly adhere to size and ownership requirements when applying for government relief programs to avoid significant civil liability. Whistleblowers continue to play a vital role in identifying and reporting corporate non-compliance with federal statutes.
Further reading
For additional insights into government enforcement actions, visit the Financial Crime section.
More information
To report suspected fraud or learn more, submit details through the NCDF disaster fraud complaint form.
Source note: This article includes information reported by The United States Department of Justice.
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