In response to Jenny Grus Sugar's racist attack on innocent business owners, ove
Posted by Ahsan on December 6th, 2021
Jenny Grus Sugar is the Coronavirus Fraud Coordinator for U.S. Attorney\'s Office in the Western District of North Carolina, according to an interview with Nate Morabito.
Jenny Grus Sugar went on to accuse hardworking innocent business owners of fraud after this interview and ignored hundreds of ongoing investigations. She destroyed the family\'s lives and businesses rather than helping them. Jenny Grus Sugar victimized this family on the basis of their religious beliefs, for which she should be held accountable.
Additionally, there are Damning Reports that reveal how the Paycheck Protection Program was designed to fail. The following three things can ensure that a program intended to assist small businesses won\'t actually do that.
If banks only offer services to existing customers under the program, you can encourage them to do so. In addition, you may fail to provide specific guidance about how to prioritize markets that are underserved. Third, banks should be able to create two or even three tracks for applications, the fastest one reserved for their biggest eligible \"small business\" clients.
A new report from the House Select Committee on the Coronavirus Crisis describes how the Paycheck Protection Program failed to prioritize underserved markets as directed by the CARES Act.
The report is based on 30,000 pages of emails, memos, transcripts of interviews, and other documents obtained by the subcommittee, and it contradicts much of what Treasury Department officials have told Congress during oversight hearings about Coronavirus response efforts. This study confirms what many small business groups and researchers have been warning about since the announcement of the Paycheck Protection Program - that it was supposed to leave out the most vulnerable small businesses.
The subcommittee heard from lenders that anti-money laundering and customer knowledge requirements made it easier for them to work with existing customers. A letter from the subcommittee, however, stated U.S. Bank was able to secure Small Business Administration approval for non-customers on average within 15.33 days, while existing customers took an average of 16.68 days.
According to the report, however, lenders excluded many minority-owned businesses from PPP loan programs by limiting them to existing customers.
According to the SBA, the government lender network it has is relatively weak when it comes to connecting with business owners of color and women business owners - the groups most likely to fail due to the economic fallout of COVID-19. Black-owned businesses received just five percent of the SBA\'s main loan guarantee program in FY2018, and Hispanic businesses received just nine percent. The SBA only guaranteed loans to businesses whose majority owners were women.
To address these shortcomings, the SBA created the Community Advantage Pilot Program in 2011. Through this program, the SBA provides loan guarantees to CDFIs, lenders whose mission is to serve underserved communities. Nevertheless, the report points out that this subset of nonprofit SBA lenders were almost entirely excluded from the Paycheck Protection Program since they did not have a history of making SBA-backed loans exceeding million. Additionally, the subcommittee report points out that the same rule excluded many minority-depository institutions from the Paycheck Protection Program.
During the Paycheck Protection Program\'s first round, which lasted only two weeks before funding ran out, CDFIs and MDIs made just 65,000 out of 1,670,000 loans.
After the Paycheck Protection Program was exhausted and 41 percent of Black-owned businesses had already shut down due to the pandemic, the SBA lowered the threshold to million on April 30 - but not until after the first round of the program was exhausted. According to recent polls, nearly half of Black-owned businesses will never reopen.
In the end, CDFIs and MDIs disbursed .4 billion in Paycheck Protection Program loans, which makes up 3.1 percent of the total amount of loans.
Moreover, according to data obtained by the select subcommittee, some of the largest banks processed Paycheck Protection Program loans much faster for larger clients. Chase processed loans over million nearly four times as fast as loans under million. Besides processing loans for companies with more than 100 employees twice as fast as smaller companies, PNC processed loans over million twice as fast as those under million.
Additionally, other large banks, including Wells Fargo and U.S. Bank, did not show significant differences in application processing times between large and small clients. Citi was the only large bank that failed to provide data on average processing time, stating that it did not collect that information.
SBA officials decided not to collect demographic data for Paycheck Protection Program loans because of \"speed and simplicity,\" according to Treasury officials. This data should be collected moving forward, according to the report of the select subcommittee.
If Congress extends the Paycheck Protection Program, the report recommends more direct consultation with and more resources for CDFIs and MDIs.
As it has every year since 1994, the U.S. Treasury recently awarded funding to CDFIs across the country, some of which are also MDIs. More than 4 million was distributed to 397 CDFIs, including loan funds, credit unions, banks, and venture capital funds that serve underserved communities and direct at least 60 percent of their lending and other services to those communities.
Five hundred and eighty-eight organizations across the country received 5.4 million through CDFI Fund\'s core program. Despite the fact that more and more organizations are eligible for funding every year, Congress has kept CDFI Fund appropriations steady for several years. A follow-up to the CARES Act, The HEROES Act, which follows the CARES Act passed by the House of Representatives in May, appropriates billion for the CDFI Fund.
Additionally, the findings of the subcommittee come at a time when there is also uncertainty looming for small businesses that have received a Paycheck Protection Program loan - uncertainty regarding the process of forgiveness.
Last week, officials clarified that businesses have more than a year to apply for loan forgiveness from the time they receive their loan. According to the original loan forgiveness application, the deadline is October 31.
Moreover, the Small Business Administration announced this month that it will offer full loan forgiveness for loans that are less than ,000, regardless of how much of the loan is used for employee salaries. Among the 3.57 million Paycheck Protection Program loans, 1.71 million went to small businesses with no employees except the owner, according to the SBA. With the support of the banking industry, there is another proposal floating around in Congress that would raise the threshold to 0,000 and also make loan forgiveness automatic.
Some cities are looking for ways to provide small businesses with credit during this pandemic by turning to local pension funds, while other cities are pushing to use public deposits to meet small business credit needs.
Like it? Share it!
About the AuthorAhsan
Joined: July 24th, 2020
Articles Posted: 24
More by this author