USE Department of Justice USE
Courtesy of the Department of Justice

Mount Zion Baptist Church will settle a federal civil lawsuit for misusing pandemic-era Paycheck Protection Program (PPP) loans.

According to a U.S. Department of Justice news release, the church, which operates four Nashville-area campuses including one in Brentwood, has agreed to pay $70,464.39.

The litigation was sparked from a whistleblower complaint by a former employee of the church, who will now receive $10,569.66 of the settlement, per provisions of the False Claims Act.

The complaint alleged that “MZB unjustly enriched itself by improperly using the PPP loan to make mortgage principal payments in violation of the PPP regulations.”

“The United States alleged that MZB applied for a PPP loan in April 2020, certifying that the loan would be used only for purposes permitted under the PPP regulations, including mortgage interest payments," the news release reads. "But on May 29, 2020, MZB made two separate mortgage principal payments totaling $70,464.39, in violation of the PPP requirements." 

In 2021, the church applied for and was approved full forgiveness on the loan.

The DOJ reports that since they launched the COVID-19 Fraud Task Force in 2021, more than $1.4 billion in stolen COVID-19 relief funds have been recovered.

Mount Zion Baptist Church issued the following statement: 

“Mt. Zion Baptist Church cooperated fully in a DOJ review of the $967,000 in PPP loans we received during the pandemic, part of which was used to make mortgage interest payments. We recently learned that, due to an inadvertent clerical error, 10% of those funds were used to pay the principle on our mortgage instead, and we immediately repaid the funds.”