Two Valley legislators want to know how the company behind the diseases and biological materials found at an illegal Reedley lab was able to secure $150,000 in COVID-19 business grants.
Congressman Jim Costa (D-Fresno) and Speaker of the House Kevin McCarthy (R-Bakersfield) authored a letter to the Pandemic Response Accountability Committee, wanting them to look into two loans given to Universal Meditech Inc. as part of the Payment Protection Program.
Those loans were eventually forgiven — as were 92% of loans made to businesses through the pandemic.
Costa, McCarthy Want to Know if PPP Grant Was Fraudulent
UMI’s biological materials, including 20 different diseases and 1,000 lab mice were found in an illegal Reedley lab owned by a Nevada-based company, Prestige Biotech. Both companies are owned by Chinese nationals.
“We urge the PRAC to review how this company was awarded federal pandemic funding and recover these funds taken by this entity if your review determines this action is appropriate,” the letter stated.
The PRAC investigates for waste, fraud, or abuse of money given out during the pandemic.
NPR reports at least 70,000 loans were potentially fraudulent.
Universal Meditech received its first loan in April 2020 and a second in February 2021. At the time, UMI was registered in California. It reported having 15 employees at the time of the second loan.
Fresno Lauded UMI Move in 2018
The company did post a City of Fresno Business Tax Certificate in its office, according to an October 2022 inspection report conducted by the Fresno City Attorney’s Code Enforcement Unit. That certificate had expired Sept. 9, the inspector reported.
When UMI moved to Fresno from Tulare in 2018, the company “received strong support and help from Fresno governments,” CEO Xiaoxiao Wang said in a November 2022 email to the Code Enforcement Unit obtained by GV Wire.
In 2019, the state of California awarded UMI a $360,000 tax credit, but that money was revoked, according to the California GO-Biz website.
The letter from Costa and McCarthy mentions Prestige Biotech, the creditor company that took control of UMI’s assets.
Searches for Prestige Biotech in the PPP database yielded no results.