Delta Airlines has agreed to pay $8.1 million to settle allegations that it misused federal relief funds under the Payroll Support Program (PSP). The PSP was established by the CARES Act to provide financial support to airlines and other businesses during the pandemic. Companies receiving these funds were required to impose compensation caps on highly paid executives.
The U.S. government claims Delta violated these conditions and falsely certified compliance. “When companies accept federal assistance, especially generous pandemic-relief funds like those at issue here, they owe a duty to the American people to respect the conditions placed on those funds,” said U.S. Attorney Theodore S. Hertzberg.
The investigation began with a whistleblower lawsuit filed under the False Claims Act, which allows individuals to bring fraud claims on behalf of the government. The whistleblower alleged Delta breached compensation cap agreements from March 2020 to April 2023 and failed to inform the Treasury Department of its non-compliance.
Delta received about $11.9 billion in PSP funds, including $8.2 billion in grants not requiring repayment, with an agreement to adhere to compensation limits until April 2023. The settlement resolves a qui tam lawsuit filed in the U.S. District Court for the Northern District of Georgia, United States ex rel. H. Remidez, LLC v. Delta Airlines, Inc., No. 1:23-CV-1116.
The whistleblower will receive $825,000 from this settlement plus attorney’s fees. The case was investigated by multiple agencies including the U.S. Attorney’s Office for the Northern District of Georgia and others.
Assistant U.S. Attorney Anthony DeCinque and Trial Attorney James Nealon were involved in reaching this civil settlement, along with former Senior Trial Counsel Dan Spiro.
It is important to note that these are allegations only and there has been no determination of liability.
For more information contact the U.S. Attorney’s Public Affairs Office at USAGAN.PressEmails@usdoj.gov or (404) 581-6185.
