Majority of emergency paycheck protection loans against COVID went to just 5% of businesses

The Trump administration has, after legal wrangling over the data, released the names of the 10 million businesses and individuals who have received pandemic relief under the Economic Disaster Loan (EIDL) and Paycheck Protection Program (PPP).
These programs have been the primary sources of support the federal government has provided to small businesses impacted by the COVID-19 pandemic, and the centerpiece of the $2.2 trillion CARES Act that was approved by Congress in March.
The Small Business Administration (SBA), responsible for approving and processing the money, had processed more than 5.2 million PPP loans to individuals, totaling $525 billion as of November. It also handled EIDL loans worth $195 billion.
New data showed that more than half of the money from the Treasury Department fund went to about 5% of recipients. In addition, the top 1% of loans accounted for more than a quarter of the total value of loans.
PPP data showed that about 600 companies have recovered the maximum $10 million allowed under the program. These were mostly large companies.
In August, more than 87% of loans were below $150,000, leading the Treasury Department and the SBA to say the program primarily benefited small businesses.
However, new data points out that more than half of the $552 billion over that period went to bigger companies. The latest data shows that only 28% of the money distributed was less than $150,000.
Among those who received the maximum $10 million in aid were restaurant chains, law firm churches and professional recruitment services.
Newsweek approached the SBA for comment.
Watchdogs also warned that several billion dollars could have gone to ineligible companies and fraudsters, Reuters reported.
In September, Calvin Shivers, deputy director of the FBI’s Criminal Investigations Division, told the Senate Judiciary Committee that the $3 trillion coronavirus-related global funding was a popular target for would-be schemers. up to $126 million.
The identified PPP fraud stems from 116 investigations by the FBI, Justice Department and Small Business Administration, Shivers said. Officials who spoke to lawmakers declined to say whether anyone had been convicted at the time.
The SBA’s Office of Inspector General also said it has received tens of thousands of fraud reports and hundreds of investigations have been launched.
Senate Majority Leader Mitch McConnell began circulating plans to file a new round of stimulus with an additional $332.7 billion in aid for small businesses, including $257.7 billion for the Paycheck Protection Program, reported Axios.
The data released last night could help shape future stimulus policy and will shed light on problems with previous programs.
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