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Tags: ppp | coronavirus | pandemic | applications

Paycheck Protection Program Is out of Money, Stops Accepting New Applications

Paycheck Protection Program Is out of Money, Stops Accepting New Applications
Protest signs are seen on boxes during a food distribution and protest in front of Chateau Marmont in Los Angeles, California, on April 15, 2021, as the hospitality workers union demands Chateau Marmont comply with the Paycheck Protection Program (PPP) loan law. (Jean-Baptiste LaCroix/AFP via Getty)

By    |   Sunday, 30 May 2021 04:16 PM EDT

The federal government’s signature aid effort for small businesses ravaged by the coronavirus pandemic is out of money and has  stopped accepting most new applications, reports the Hill.

The $961 billion Paycheck Protection Program was scheduled to end on May 31, but the Small Business Administration (SBA) sent out a notice to lenders on Friday saying that “due to the high volume of originations today, the portal will be closing for new originations.”

The SBA said it had received more than 125,000 applications in the 24 hours before it notified lenders of the PPP’s closing.

While many had predicted that the program would run out of funds before its May 31 application deadline, the exact timing came as a surprise to many lenders.

“It is our understanding that lenders are now getting a message through the portal that loans cannot be originated,” the National Association of Government Guaranteed Lenders, a trade group, wrote in an alert to its members Tuesday evening. “The P.P.P. general fund is closed to new applications.”

The PPP money was frequently targeted by swindlers making fraudulent loan applications. Fake entities across multiple states were able to obtain PPP loans worth millions of dollars by misrepresenting the number of employees they had or even the very existence of their businesses.

In early May, a California man, Mustafa Qadiri, was arrested on charges of obtaining $5 million worth of PPP loans through fraudulent means. Qadiri allegedly used the money to buy luxury cars, including a Lamborghini.

Though the program has closed, the Journal noted that the SBA has at least another month to process previously filed applications. 

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Politics
The federal government's signature aid effort for small businesses ravaged by the coronavirus pandemic is out of money and has stopped accepting most new applications, reports the Hill.
ppp, coronavirus, pandemic, applications
269
2021-16-30
Sunday, 30 May 2021 04:16 PM
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