CARES Act Transparency Failures Let Multi-Million Dollar Companies Siphon Limited Small Business Relief
Watchdog to Congress: “What’s to stop those big corporations from doing the exact same thing again?”
WASHINGTON, D.C. – Moments ago, the House passed a new relief bill to allocate funds for small businesses and American families facing hardship during the ongoing COVID-19 crisis. Like the previous iteration, the new relief bill includes a glaring hole — a failure to bolster transparency and oversight around funding for the Small Business Administration’s (SBA) Paycheck Protection Program (PPP).
“We spent the past month watching our worst fears about SBA assistance come true: multi-million dollar corporations gobbled up PPP loans they may never have to pay back as hundreds of actual small businesses were shoved aside. Without additional transparency measures in the new relief bill, what’s to stop those big corporations from doing the exact same thing again?” asked Kyle Herrig, president of Accountable.US. “Congress failed small business owners today by keeping in place a gaping loophole that will continue to benefit large corporations. We’re hopeful that in the next round of relief funding, Congress will step up and close the loophole to provide the necessary oversight of PPP loans that Americans deserve.”
Without proper accountability measures in the CARES Act, multi-million dollar corporations were given a free pass to suck the program’s funding dry as many small businesses walked away with little to nothing. This lack of oversight resulted in the following:
- Multi-million dollar companies like Ruth’s Chris Steak House, which received $20 million in funding, and Potbelly, which received $10 million in funding while it simultaneously promised to provide one of its executives up $100,000 in bonuses this year, were able to take the money and run.
- SBA PPP loan requests for more than $1 million to make up nearly 45 percent of the approved spending despite accounting for just four percent of applications overall.
- At least 94 publicly-traded firms, some worth more than $100 million, received $365 million in taxpayer money.