WASHINGTON, D.C. – The Trump SBA Paycheck Protection Program (PPP) is set to expire today after three chaotic months of mismanagement that allowed hundreds of thousands of small businesses to shutter while wealthy and well-connected publicly traded companies got loans quickly. Adding insult to injury, a number of large companies that coasted through the process turned around and used tax dollars to pump up their executive pay and engage in stock buybacks that have rewarded shareholders, an analysis by government watchdog Accountable.US found.
Among them is RW Holdings NNN REIT Inc., which received a $517,000 forgivable PPP loan in April 2020. Then on April 20, 2020, the company authorized share repurchase programs, or “stock buybacks,” to the benefit of shareholders. On a recent earnings call, the company’s CEO, Aaron Halfacre, boasted that the PPP money “allowed us to use other cash resources for mortgage payments and a small amount of share repurchases last month.”
Another company, RumbleOn, Inc., secured a more than $5.1 million PPP loan last month and then quietly revealed in recent days that the money is an excuse to reverse plans to cut back its executive compensation packages. Its CEO made $560,000 last year alone.
The Trump administration wrote the rules for the PPP program, allowing billions of dollars to go to the well-resourced and well-connected rather than actual small businesses that are struggling to survive this economic crisis. With no transparency or accountability to speak of under this mismanaged program, it’s no surprise some large companies may have misused tax dollars to their own benefit. Small businesses and their workers need help and can’t afford any more broken promises. Congress should take immediate steps to design a new program that is transparent and will actually benefit the small businesses that need help the most.”
Derek Martin, spokesman for Accountable.US
OTHER KEY FINDINGS [SOURCES]:
- After Receiving A PPP Loan, OncoCyte Went On To Raise $10.7 Million From Investors — And Offered Executives 10-Percent Interest On Deferred Compensation
- Sonoma Pharmaceuticals Closed An American Facility To Mexico 11 Days Before Receiving $1.3 Million In PPP Funding – And Proceeded To Arrange A $230,000 Payout For A Top Executive By The End Of The Month
- Agenus Inc. – Who Paid Their CEO Nearly $10 Million In 2019, And Had Cash Reserves Of $92.3 Million In March – Accepted A $6.2 Million PPP Loan