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Monday, December 09, 2019

Report: Trump Gave Free Pass To Biggest Corporate PPP Fraudsters

@alexvhenderson

Donald Trump

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The Paycheck Protection Program (PPP), which was part of the CARES Act of 2020, was launched under former President Donald Trump in response to the COVID-19 pandemic and continued into the Joe Biden era. Some PPP loans were investigated by federal officials and flagged for potential fraud. But according to a Project on Government Oversight (POGO) report released on Thursday, October 6, the Trump Administration eliminated an abundance of flags during its final weeks in office.

Truthout’s Sharon Zhang reports that according to POGO’s report, Small Business Administration (SBA) officials “eliminated 2.7 million flags between December 2020 and January 2021, as the Administration was in its lame duck period.”

In an article published on October 6, Zhang notes, “Special preference was given to the largest loans, which often also went to the largest corporations. On January 16, 2021, four days before President Joe Biden’s inauguration, Trump’s SBA wiped 99 percent of special review flags — which were given out to every loan above $2 million for separate investigatory purposes.”

Zhang notes that according to POGO, the Trump Administration “appeared to have favored the very largest loan recipients.”

“Trump continually gave huge financial favors to large corporations during his time in office — and though most large corporations were exempt from receiving PPP loans, some large corporations managed to skirt the rules and receive loans anyway,” Zhang observes. “Out of the $800 billion given out in the program, flagged loans accounted for at least $189 billion. Because the vast majority of PPP loans — 95 percent — have been forgiven, it’s likely that many of these loans that had previously been flagged have been forgiven entirely.”

Zhang points out that a National Bureau of Economic Research study released in January 2022 “estimated that only between about a quarter and a third of PPP loans went to saving workers’ jobs.”

“The rest — about 66 to 77 percent — went to business owners and people like shareholders,” Zhang reports. “Many loans went directly to the rich. Several billionaires or companies owned by billionaires received loans, like Republican fundraiser Joe Farrell or Kanye West’s apparel company, valued at $3 billion. One loan, POGO found, went to a hotel owned by West Virginia Gov. Jim Justice, a Republican who is the richest man in the state and a former billionaire.”

Zhang adds, “The loan was worth $8.9 million and appeared to have been flagged eight times by the SBA. Another loan with nine flags, worth over $5 million, appears to belong to a Kentucky hospitality corporation whose annual revenue of $850 million would likely make it too large to receive a PPP loan.”

Reprinted with permission from Alternet.

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