Tri-Cities business accused of COVID loan fraud at Hanford site. It will pay $3 million

A Hanford contractor based in Kennewick and its owners will pay nearly $3 million after being accused of fraud related to a loan from a federal program to help small businesses during the COVID-19 pandemic.

“These funds were intended to help small and local businesses and keep the communities of Eastern Washington safe and strong, not to line the pockets of millionaire owners,” U.S. Attorney Vanessa Waldref, said in a statement.

HPM Corp., the occupational medicine contractor at the Hanford nuclear site, received a loan of just over $1.3 million in April 2020 from the Coronavirus Aid, Relief and Economic Security, or CARES, Act.

A year later the U.S. Small Business Administration forgave the initial loan and about $13,500 in interest.

According to an investigation by the Department of Energy Office of Inspector General, the loan money was not spent by the contractor but was transferred in July 2021 to the personal checking account of Hollie Mooers, the founder and president of HPMC, and her husband, Grover Cleveland Mooers.

That was about three months after the loan and interest were forgiven.

“Stealing money from pandemic relief funds is reprehensible,” said Teri Donaldson, DOE inspector general, in a statement released Thursday evening.

HPMC could not immediately be reached for comment Thursday evening.

In September 2021, about two months after the loan was transferred to the Mooers’ personal account, the full amount of the loan money was distributed through Cornerstone Wealth Strategies to various charities, according to a federal court document filed Wednesday.

HPMC officials said during the investigation that the the donations were handled as personal donations of the Mooers rather than donations from HPMC.

HPMC continued to receive full payments under its DOE contract, and in fact its business at the Hanford site increased because it was awarded additional contract work related to testing for COVID-19 and vaccine administration, according to a court document.

HPMC was awarded a DOE contract at the end of 2018 valued at $152 million for up to seven years.

The contract included several payment methods, including fixed prices for some services, reimbursement of building and equipment costs, and payment to be negotiated for additional work.

Grover Cleveland Mooers was accused in a court document of knowingly provide false statements in support of HPMC’s application for loan forgiveness.

He falsely certified that the loan was used to cover HPMC business-related expenses and that the loan was eligible for forgiveness, which it was not, according to the court document.

In the application to have the loan forgiven, Mooers certified that the loan was used to pay for eligible costs in the CARES Act Paycheck Protection Program. That could include payroll to retain employees, mortgage interest, rent, utilities, operation costs, property damage, supplies or worker protection.

Loan fraud penalties

Under the terms of an agreement to resolve HPMC’s criminal and civil liability in connection with the loan, HPMC will pay the federal government almost $2.7 million in restitution and penalties.

Criminal charges against the company will be deferred for three years and during that probation it must not commit any criminal or civil offenses.

The Mooers must pay an additional $250,000 of their own money to the federal government, according to the U.S. Attorney’s Office of the Eastern District of Washington.

Grover Cleveland Mooers has agreed to step down from HPMC, and not serve as a principal employee, manager or adviser for HPMC for three years.

HPMC also has agreed to pay for an independent audit of the company’s accounting practices related to expenses, distributions, dividends, salaries and expenses to the Mooers or any other HPMC officers, owners or shareholders.

“Lying to gain access to SBA’s pandemic response programs is not without consequence,” said Weston King, regional special agent in charge of the SBA Office of Inspector General, in a statement. The SBA Office of Inspector General also investigated HPMC.

The initial complaint about HPMC was made by a DOE official to the DOE Office of Inspector General, according to a court document.

This case was investigated as part of the U.S. Attorney’s Office COVID-19 Fraud Strike Force, an interagency team of federal law enforcement agencies combating COVID relief fraud in Eastern Washington.

The 580-square-mile nuclear reservation in Eastern Washington was used from World War II through the Cold War to produce almost two-thirds of the plutonium for the nation’s nuclear weapons program.

Now the federal government is spending more than $2.5 billion a year to maintain the site and clean up radioactive and other hazardous chemical waste and contamination.

Most of the work is done by contractors hired by DOE.

This story was originally published March 25, 2022 at 5:00 AM.