Strand Settles PPP Loan Case Involving Sen. Ron Wyden’s Wife

The Strand, New York City’s iconic bookstore, has agreed to pay nearly $1.5 million in a civil settlement for accepting a government Covid loan that was prohibited because the store is owned by the wife of Oregon Democratic Sen. Ron Wyden, according to the U.S. attorney’s office in Washington, DC.

The Strand applied for a $932,350 loan in February 2021 from the Paycheck Protection Program administered by the Small Business Administration, U.S. Attorney Jeanine Pirro’s office announced Tuesday.

The store’s owner, Nancy Bass Wyden, certified on the loan application that “the spouse of a Member of Congress does not directly or indirectly own a controlling interest in the applicant,” Pirro’s office said.

“Ms. Wyden’s certification was knowingly and materially false and Strand was ineligible for the second loan draw he received,” the office said.

The Strand will pay $1,482,560 to settle the case. No liability has been determined by the store, Pirro’s office said.

The Strand, in a statement, said the store made an “unintentional” error in applying for the loan and said it was unaware at the time that the funds were prohibited from businesses owned by a congressman’s spouse.

Bass Wyden’s husband, who has served in the Senate for more than 30 years, is a vocal critic of President Donald Trump, who nominated Pirro to be attorney general of the District of Columbia.

Bass Wyden is the granddaughter of Ben Bass, founder of Strand, whose flagship store is in Greenwich Village.

Congress authorized PPP forgivable loans when it passed the Coronavirus Aid, Relief, and Economic Security Act in March 2020.

In December 2020, Congress provided additional funding for the PPP loan program with separate legislation, which “included a prohibition on businesses from obtaining a second draw of PPP funds if a member of Congress or their spouse directly or indirectly owned a controlling interest in the PPP loan applicant,” Pirro’s office said.

In a statement Tuesday, Pirro said, “The Paycheck Protection Program was created to save American jobs, not to enrich those who are ineligible for taxpayer-funded relief, especially the wife of a U.S. senator. »

His office noted that the False Claims Act, which Strand allegedly violated, “allows the government to establish liability based on reckless negligence and allows the government to recover more than its actual losses,” which is what happened in this case.

The civil settlement resolved claims filed in a so-called qui tam lawsuit, which allows private whistleblowers to file a lawsuit on behalf of the U.S. government and receive a portion of any money recovered.

The qui tam action in this case was filed by a corporate entity, Blockquote Inc., in the U.S. District Court in Washington. Blockquote, whose owners were not disclosed by Pirro’s office, will receive a total share of approximately $148,256 as part of the settlement.

The Blockquote lawsuit file is closed from public view.

The Strand, in a statement after CNBC requested comment from the store and Bass Wyden, said the restriction the store violated was passed by Congress between the first and second rounds of the PPP.

“Unfortunately, the bookstore accountant and the bank administering the loan were unaware of this change when processing the second printing request,” the Strand said.

“We are sticking to the facts: The circumstances arose during an unprecedented and rapidly evolving public health emergency, the error was not intentional,” the outlet said. “We hope that this matter will be considered objectively and in its appropriate context, with the understanding that the application of justice must always be fair, impartial and free from political considerations,” the outlet said.

A spokesperson for Senator Wyden’s office said the senator and his wife do not discuss his affairs and that he was not involved in the loan or settlement.