Spokane Dermatologist to Pay $1.4M to Settle COVID-19 Fraud Claims

A Spokane, Washington dermatologist and his affiliated businesses have agreed to pay $1.4 million to settle allegations they misused federal COVID-19 relief funds, according to the U.S. Attorney’s Office.

William Philip Werschler, 66, and his companies—Spokane Dermatology Clinic, Premier Clinical Research L.L.C., and 3rd and Sherman Plaza L.L.C.—were accused of misappropriating Economic Injury Disaster Loan (EIDL) funds for personal expenses. The settlement resolves claims under the False Claims Act.

The EIDL program, established under the CARES Act, provided low-interest loans to help small businesses stay afloat during the pandemic. These funds were to be used only for business expenses like payroll, rent, and insurance.

According to the settlement agreement, Werschler began applying for EIDL loans for his businesses in or before April 2020 and continued until at least July 2022.

Shortly after receiving EIDL funds, Werschler allegedly spent $252,375 on two personal vehicles—a 2011 Porsche 911 GT3 and a 1997 Porsche Carrera. He also used $553,143 to buy two properties near his dermatology clinic. The press release states these purchases were “contrary to the proper use of EIDL funds.”

The resolution also addressed related criminal charges, federal prosecutors said.

The case was investigated by the IRS Criminal Investigations, the FBI, and the Small Business Administration Office of Inspector General.