iNDICA NEWS BUREAU
An Indian American hotelier from New York who was sued by Adirondack Trust Co. for allegedly misusing $1.9 million in federal COVID-19 loans says bank executives have since admitted that they found no actual evidence of fraud.
Niral Patel, who owns the Comfort Inn and Suites in Saratoga Springs as well as the Golden Corral in Wilton and several other Golden Corral franchises across the state and in New Jersey, was sued by Adirondack Trust last October after the bank froze the loan funds, which were obtained through the federal government’s Paycheck Protection Program designed to keep hotels, restaurants and other businesses afloat during the first year of the pandemic.
Patel, a Saratoga Springs resident, turned around and sued Adirondack Trust for $10 million over the allegations and for freezing the loan proceeds.
In a recent filing in that case, Patel says the bank had no real reason to freeze his account or deny him the PPP loan money – except that they worried he would not be able to repay the loans. Patel also asserts that the bank’s response was due to underlying racism against his family, which is Indian-American, even though they have banked with Adirondack Trust for 20 years.
In an affidavit filed by Patel on September 2, he said that the company made unsupported allegations about him in attempt to justify its decision to deprive my businesses of access to more than $1.9 million in funds during the middle of a public health and economic crisis.
He added that the company with its allegations was threatening his businesses’ livelihood, embarrassed his family, compromised his reputation within the community and with his employees.
In its lawsuit, Adirondack Trust had alleged that Patel had used the loan proceeds on unauthorized payments such as for his mom’s mortgage.
That allegation is “ridiculous and false,” Patel says in his affidavit.
“The filing is the beginning of an effort to clear my name, my family’s name, and help us put hundreds of people back to work locally and across the state,” Patel said in a later statement released to the media.
Adirondack Trust has since issued its own statement defending its actions in the case. In its original lawsuit, the bank also pointed out that Patel was technically not eligible for the PPP loans because of various lawsuits and tax liens against his companies that were not disclosed in his loan applications. The bank also has detailed Patel’s movement of the loan proceeds through is various accounts that led them to accuse him of misusing this loan funds.
“Mr. Patel was treated, as all of our customers are treated, with consideration, courtesy and respect at all times,” the bank said in a statement issued by Patrick Reilly, a senior vice president at Adirondack Trust.
The statement said that Adirondack Trust only realized after it had approved the $1.9 million in loans for Patel that his businesses might not be eligible under SBA rules.
“We consulted with the SBA and worked with Mr. Patel to address these matters, but despite our best efforts were unable to do so,” the statement reads.