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Senior Director of Strategic Alliances
LexisNexis Risk Solutions - Government

The first time is always exciting. On November 7, 2023, United States Attorney Freedman announced a first time ever settlement of a False Claims Act Whistleblower Case Involving Grants for Restaurants and Similar Businesses Struggling During the COVID-19 Pandemic. (Applause here). Now that is exciting. The Federal False Claims Act/Whistleblower Law provides whistleblowers financial rewards as well as job protection against retaliation when they report criminal activity in their place of employment. In this first time ever settlement involving a restaurant during the pandemic, the whistleblower is from a Denny’s in Geneseo, NY. The Denny’s is owned by Feast American Diners LLC and Dawood “David” Beshay. Turns out, Beshay couldn’t remember how many Denny’s he owned. Easy mistake.

In May 2021, Beshay applied for a Restaurant Revitalization Fund grant on behalf of Feast American Diners, in the amount of $928,554. One of the questions on the application asked whether Feast American Diners owned or operated more than 20 locations as of March 13, 2020, to which Feast American Diners responded “no.” That same question indicated that an applicant who responded “yes” would not be eligible for the grant.

The RRF was part of the American Rescue Plan Act to provide relief to qualifying restaurants monetary awards to revenue losses that were caused during the COVID-19 pandemic. Restaurants that owned or operated more than 20 locations as of March 13, 2020, were not eligible. Beshay in fact owned 21 Denny restaurants as of March 13, 2020. Oops.

On November 8, 2023, it was decided that Beshay, as the first time ever settlement of a case involving False Claims Act Whistleblower Case Involving Grants for Restaurants and Similar Businesses Struggling During the COVID-19 Pandemic allegations, will pay $2 million to resolve these allegations. A step financial fine. But he still gets to keep his job. The rest of the employees at Denny’s in Geneseo do not get to keep their jobs. The restaurant has been closed as of October 30, 2023.

Today’s Fraud of The Day is based on article “Geneseo Denny’s owner to pay $2M in COVID fraud case; restaurant closed” published by Livingston County News on November 8, 2023

The Denny’s restaurant in Geneseo closed its doors this week and days later the U.S. Attorney’s Office in Syracuse announced that the restaurant’s owner would pay $2 million to resolve pandemic funding falsehoods.

On Oct. 30, two handwritten signs were taped inside the doors of the restaurant at 4240 Lakeville Rd. The signs said “CLOSED PERMENENTLY [sic] AS OF 10/30/2023” and “Thank you for all of your support and buisness [sic] through the years, The Geneseo Denny’s Team.”

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