$660bn PPP aid: Trump admin releases names of biggest borrowers

The data provides transparency for the first-come-first-served programme that has been dogged by fairness issues.

Pandemic business aid
Amy Hillyard's cafe Farley's East located in Oakland, California reopened on April 29 with the help of the Paycheck Protection Program, part of the $2.3 trillion economic relief package passed by Congress in late March [File: Nathan Frandino/Reuters]

The Trump administration on Monday said it was releasing the names of hundreds of thousands of businesses that took money from a high-profile $660bn government pandemic aid programme, letting the public see for the first time how the majority of the cash was spent and, crucially, whether it helped save jobs as intended. 

The United States Treasury and Small Business Administration (SBA) said the $521.4bn in approved loans to employers so far has supported some 51.1 million jobs, or 84 percent of all small business employees.

The colossal data set on the Paycheck Protection Program (PPP), released by the Trump administration after some initial resistance, provided a far higher level of transparency for the first-come-first-served programme that has been dogged by technology, paperwork and fairness issues.

To date, the SBA has released broad distribution figures for states, industries and the largest lenders. But the new data offered a much more detailed picture of which local communities and sub-sectors received support.

The data could make life uncomfortable for lenders that shovelled money out the door and borrowers that broke the spirit or letter of the rules of the programme that aimed to help cash-strapped companies keep workers employed.  

The Treasury and SBA said they were releasing data for more than half a million loans of $150,000 or more, including recipient name, address, business type, jobs supported, and some demographic information. That accounts for roughly 73 percent of the dollars granted, but only 14 percent of the 4.9 million loans, according to a summary of data the agencies released initially on Monday.

PPP aid
Donica Johns, who runs her own skincare business, said last month that she had applied for a loan from the Paycheck Protection Program but had not heard back [File: Kathleen Flynn/Reuters]

While the released data will not say exactly how much money each borrower received, the agencies said they were placing them in a band of varying loan ranges.

Loans were capped at $10m, although the average loan size was $107,000, the data shows. The Treasury said it was releasing aggregate data on loans below $150,000 but said it would not name the recipients.

The funds reached a wide swath of recipients – more than $67bn for the healthcare and social assistance sector, $64bn-plus for construction businesses, $54bn for manufacturing and, at the smaller end, more than seven billion dollars for religious organisations, the initial data summary showed.

Lingering questions 

Treasury Secretary Steven Mnuchin had initially refused to name any recipients, saying it could expose borrowers’ proprietary business information, particularly if they are sole proprietors and independent contractors. But he eventually bowed to pressure from legislators and agreed to shine a light on large borrowers.

Launched in April, the unprecedented programme allows small businesses hurt by the pandemic to apply for a forgivable government-backed loan from a lender.

More than 5,000 US lenders participated in the programme, with JPMorgan – the country’s largest bank by assets – accounting for $29bn in loans. JPMorgan, Bank of America, Truist Bank, PNC Bank and Wells Fargo originated 17 percent of total PPP loans, according to the data.

In the scramble to distribute funds, the programme was beset by technology glitches, documentation snags and revelations that some lenders prioritised their most profitable clients, leading to some affluent companies receiving funds while less well-heeled borrowers missed out.

There have been lingering questions about whether the most needy benefitted.

Roughly $30bn worth of loans have been returned or cancelled, a senior administration official told reporters on Monday. Those include loans taken by large or publicly listed companies, which attracted fierce criticism for breaching the spirit of the rules, as well as duplicate loans issued to borrowers that applied with more than one lender or companies that decided they did not want or need the loan after all.

The data shows loans that have been approved by the SBA, but does not provide information on those which have been forgiven so far. Loans that appear to breach the letter or spirit of the rules may not be forgiven, and senior administration officials confirmed on Monday that they still intended to conduct a full review of loans of more than two million dollars.

The Department of Justice has already brought charges against several PPP borrowers for fraudulently seeking loans, while the Securities and Exchange Commission has also begun scrutinising companies whose public disclosures may have been inconsistent with the declaration of need borrowers were required to make when seeking the loans.

Source: Reuters