More than 50 people who allegedly committed fraud to obtain moneyfrom the PPP have been criminallycharged by the Department of JusticeCriminal Division’s Fraud Section,Acting Assistant Attorney General BrianRabbitt said in a Sept. 10 speech atthe PPP Criminal Fraud EnforcementAction press conference in Washington.
STIMULUS TALKS FALTER
The Senate GOP’s new “targeted”COVID- 19 relief bill, which SenateDemocrats blocked on Sept.10, included a “second round”of PPP funds.
Senate Majority Leader
Mitch McConnell, R-Ky.,
said in introducing the bill
on Sept. 8 that it focused on
“some of the very most urgent
health care, education and
After the Sept. 10 vote,
McConnell tweeted: “Every Senate
Democrat just voted against hundreds
of billions of dollars of COVID- 19 relief.
They blocked money for schools, test-
ing, vaccines, unemployment insurance,
and the Paycheck Protection Program.
Their goal is clear: No help for American
families before the election.”
In comments before the vote, Senate
Minority Leader Chuck Schumer,
D-N.Y., said that the Senate “will take
a rather pointless vote on the latest,
McConnell “claims that his bill is
an attempt at a bipartisan solution,”
Schumer continued. “But, of course, the
bill was drafted solely by Republicans —
no input from Democrats — and rushed
to the floor.”
Schumer said “Democrats urge our
Republican colleagues to come to the
table, meet us halfway, and negotiate
in good faith on a bipartisan com-
prehensive bill that will benefit the
But chances of a stimulus bill getting
done before the Presidential election
Andy Friedman, founder and princi-
pal of The Washington Update, told IA
on Sept. 10 that “reaching agreement on
a bill will be tough,” as “the closer we get
to the election, the (even) more partisan
the negotiations become.”
The “wild card,” Friedman added,
“is that the president believes that a
strong economy will improve his chanc-
es of winning the election, and he might
push the Senate Republicans to agree
to legislation that provides additional
PPP LOAN FRAUD
Treasury Secretary Steven Mnuchintold the House Select Subcommitteeon the Coronavirus Crisis on Sept. 1that while the deadline to apply fora PPP loan ended on Aug. 8, therewas PPP funding left over and thatthe money should be targeted at thehardest-hit industries.
Meanwhile, at the hearing, the subcommittee released a preliminary analysis that found more than $1 billion inPPP loans were given to companies thatreceived multiple loans, which violatedPPP rules.
On June 15, the Select Subcommitteelaunched an investigation into the Trumpadministration’s implementation of thePPP, following reports that the programfavored large, well-funded companies.
In response, Treasury and SBA produced detailed data on all 5. 2 millionloans approved by SBA as of Aug. 8, thesubcommittee states.
The analysis shows “PPP helped millions of small businesses and non-prof-it organizations stay afloat during thecoronavirus crisis, but a lack of oversightand accountability from the TreasuryDepartment and Small BusinessAdministration may have led to billionsof dollars being diverted to fraud, waste,and abuse, rather than reaching smallbusinesses truly in need,” according tothe lawmakers.
The subcommittee report cites the
following areas as also pointing to a high
risk for fraud, waste and abuse
in the PPP program:
• More than 600 loans total-
ing over $96 million went
to companies excluded
from doing business with
• More than 350 loans worth$195 million went to government contractors withsignificant performanceand integrity issues.
• Federal databases raised red flagsfor $2.98 billion in loans to morethan 11,000 PPP borrowers.
• SBA and Treasury approved hundreds of loan applications missingkey identifying information aboutthe borrower.
The administration, according to the
analysis, “appears to lack the appropri-
ate oversight mechanisms to identify
and root out these problems.”
Rep. James Clyburn, D-S.C., chairman
of the subcommittee, sent a letter to
Treasury and the SBA on Sept. 1 request-
ing that they conduct a review of the
management of the PPP in light of the
Clyburn asked PPP and SBA to“examine the categories of loans” identified in the analysis and any other loansthat contain “indicia of fraud, as well asthe program’s oversight and accountability mechanisms.”
Washington Bureau Chief Melanie Waddell canbe reached at email@example.com.
At the hearing, the subcommittee
released a preliminary analysis
that found more than $1 billion
in PPP loans were given to
companies that received multiple
loans, which violated PPP rules.