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11/09/2020
Hundreds Of Probes Into PPP Loan Fraud Have Been Opened
PYMNTS.com
The federal Paycheck Protection Program (PPP) designed to blunt the economic impact of the pandemic is beset by extensive instances of fraud, The Wall Street Journal (WSJ) reported, attributing the conclusion to public records and interviews with government officials.
The program provided about $525 billion to 5.2 million businesses. Banks administered the loans on behalf of the government and were not required to ensure that applicants were telling the truth about their financial situations. The program ran out in August and has yet to be renewed.
WSJ reported that the Small Business Administration’s (SBA’s) inspector general said there were “strong indicators of widespread potential abuse and fraud in the PPP.”
Among problems cited by the SBA, according to WSJ, were forged companies getting money; companies getting money even though their payrolls exceeded the 500-worker cap that applied in most instances; and companies getting money even though they were prohibited to do so because of pre-existing debts to the government.
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