Americans Were Robbed. Again.

The unforgiving, forgiveness loans to keep Americans on the payroll of small businesses.

Photo by Suzy Hazelwood from Pexels

The paycheck protection program (PPP) loans introduced by Congress via the CARES Act, was intended to subsidize the payroll of the companies with 500 employees or less, and any funds remaining could go towards rent, mortgages, and utilities. The small businesses could apply through their bank and if they followed the PPP guidelines the loans would become government grants. Financial institutions administering the $525 billion in loans, earned 5% on $350,000 or less, 3% on $350,000 to $2 million, 1% on $2 million or more, and 1% interest on the loans ineligible for forgiveness. On the first-come, first-serve basis, some small businesses were able to access the funds, but the banks’ tiered fee structure led to favoring larger loans, inadequate background checks, systemic racism in lending practices, and at least $4 billion in fraudulent payments.

When the federal government was asked to reveal the recipients and the loan amounts, it stated the information was confidential, but the intense public scrutiny demanding transparency prompted the government to release some data in July. As officials review the financial documents they are uncovering applications with missing information, bogus businesses, companies receiving multiple loans, and many more issues. Banks claim the urgency in processing the funds hindered thorough eligibility checks, but after Americans caught wind of their profit margins and discriminatory practices the financial providers offered to divvy the proceeds to the minority owned businesses and sole proprietors they had overlooked, denied, or ignored.

An internet search for PPP loans delivers an assortment of stories on the misuses of the funding, and the numerous unqualified recipients who applied and received the funds. As charges are brought against some of the fraudsters, the search continues for the unaccounted $4 billion, and an investigation on how the funds were spent by the business owners is underway, but these are the consequences of a bigger issue. The objective of the PPP was to provide Americans with their employment wages during the Covid shutdown, yet the federal government decided funneling $525 billion through the banking system, trickling it…