The U.S. Department of Justice (DOJ) announced on Friday that a Chilean-owned plastics company in Knoxville, America Plastics, has agreed to repay about $2.25 million to settle allegations that it failed to count foreign workers in its application for a Paycheck Protection Program (PPP) loan during the COVID-19 pandemic.
According to the DOJ, America Plastics obtained a PPP loan, as well as debt forgiveness, despite not being entitled to the loan due to a failure “to include employees of its foreign parent and foreign affiliates,” which if included, “would have exceeded the 300-employee size limitation applicable to second-draw PPP loans and would not have been eligible to receive the loan.”
Although based in Knoxville, public press releases indicate America Plastics was acquired in 2014 by Omega Plastics, LLC, described as a Clinton-based plastics company.
Two years before Omega’s acquisition of the Knoxville plastics company, it announced a strategic partnership with De Vicente Plásticos (DVP), which Plastics Today described as a “Chile-based” company. The DVP website states that it was originally founded in Santiago, Chile by Don Luis de Vicente in 1967.
According to a website describing the company’s work in Knoxville, it also continues to operate facilities in Carrollton, Texas, and Santiago, in addition to Tennessee.
An online database of PPP loan applications shows that America Plastics claimed 171 employees in one application. The Knoxville Chamber of Commerce records 200 employees for Omega Plastics in 2024-25 on a list of major manufacturers in the area.
The press release from the U.S. Attorney’s Office states that the company’s settlement will resolve a civil lawsuit filed under the False Claims Act, which includes provisions allowing private citizens to sue on behalf of the government for false claims and a share of financial recovery. It does not reflect an admission of liability by the company.
It also revealed the settlement resulted from the creation of the National Fraud Enforcement Division under President Donald Trump earlier this year.
Vice President JD Vance leads the task force, and in May announced it had referred more than $22 billion in fraudulent small business loans back to the Treasury for collection.”
Vance also highlighted $1.3 billion in allegedly fraudulent Medicaid reimbursements, $6.3 billion in government contracts that may be fraudulent, and said that the Trump administration had blocked $60 million in student aid fraud.
More recently, the vice president reported last month that his task force’s actions removed 750,000 people who were fraudulently enrolled in Obamacare health insurance exchanges, including 50,000 connected to 40 brokerage agents.
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Tom Pappert is a 2025 recipient of the Dao Prize and the lead reporter for The Tennessee Star. He also reports for the Star News Network. Follow Tom on X. Email tips to [email protected].
Photo “DOJ Logo” by The United States Department of Justice.
