U.S. Govt Intervenes in False Claims Lawsuit Against Pinnacle Bank

The U.S. Attorney’s Office has intervened in a lawsuit against Pinnacle Bank (Pinnacle) in the U.S. District Court for the District of Wyoming, the U.S. Department of Justice announced last month.  The complaint alleges that Pinnacle made false statements to the United States Small Business Administration (SBA) regarding a loan under the SBA’s “504 Loan Program.”

Pinnacle Bank provided the Columbine Group, LLC, (developer of the hotel) with an interim construction loan for the AmericInn Lodge and Suites located in Laramie, Wyoming.  The government alleges that Pinnacle falsely certified to the SBA that it had no knowledge of any un-remedied substantial adverse change in Columbine’s financial condition since the date of the application for the SBA loan, that Columbine was current on its payments to Pinnacle and not otherwise in default of the loan, and that Pinnacle had disclosed to the SBA all material information known to it. Columbine later defaulted on its loans and the United States was required to use taxpayer dollars to repurchase the debenture pursuant to its guarantee.

The lawsuit was originally filed by Hospitality Management, Inc. (HMI), business operations manager for the hotel, under the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Should the United States government and HMI prevail in court, HMI will receive 15 to 30 percent of the settlement.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.