![]() In response, Congress changed program rules to expand eligibility and increase fees for smaller businesses by up to ten times. ![]() The result was that loans were not getting to the smaller borrowers that were potentially the most at risk. Originally, banks gravitated to larger loans and more established applicants because those applications were easy to process and resulted in higher fees per loan. The PPP program launched with the 2020 CARES Act in response to the COVID-19 crisis to provide unprecedented levels of emergency funding in the form of SBA-backed loans intended to help businesses keep their workforce employed. The report found that the fintech companies failed to fulfill their responsibilities to prevent fraudulent activity and caused significant harm and the loss of large amounts of program funds. ![]() The Committee, charged with examining reports of fraud related to the coronavirus crisis, initiated an investigation to determine the role of financial technology (fintech) companies that made “massive profits” by directing small businesses to lenders providing loans under the federal program. Previously, the SBA Inspector General reported unprecedented levels of fraud within the program, in part due to a lack of sufficient specific guidance for lenders to effectively identify, track, address, or resolve potentially fraudulent PPP loans. On December 1, 2022, the House Select Subcommittee on the Coronavirus Crisis released a staff report describing the poor performance of the financial technology companies that took a prominent role in administering the Paycheck Protection Program (PPP). Public Services, Infrastructure, Transportation.
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