New PPP 'Loan Necessity' Questionnaire Raises Concern Among Small Business Owners
DALLAS (CBSDFW.COM) - Months after thousands of small businesses accepted government aid to help them get through the pandemic, some borrowers are worried the government is changing the forgiveness rules.
The Small Business Administration (SBA) has started asking some borrows, mainly those took out loans of more than $2 million, to fill out a Loan Necessity Questionnaire asking businesses to document why they needed the loan.
Back in the spring when businesses took out these loans, all that was required was for borrowers to make a "good faith determination" that they needed the money.
More than 80 of the nation's largest business organizations have written a letter to Congress asking lawmakers to stop the SBA from requiring this questionnaire.
"We just want this program to operate as it was advertised," said Mike Kennedy with the Associated General Contractors of America (AGC).
Kennedy said if the SBA uses the questionnaire to determine forgiveness than the government agency would be using a different standard than businesses were initially told.
"They simply went off the rails when they decided to develop this questionnaire in secrecy," he said.
Kennedy said the SBA should be focused on how the PPP money was used but pointed out that's not on the questionnaire.
Meanwhile, more stories of PPP loan fraud continue to come to light.
One of the latest examples of alleged fraud involves seven men, six who are from Texas.
According to court records, federal investigators said the men submitted "over 80 PPP loan applications" using "fraudulent financial documents."
They were approved for approximately $16 million.
Some of the loan money went to pay for luxury items, such as a Lamborghini and a million-dollar home in Houston, according to investigators.
According to a recent Congressional report, red flags have now been raised on 11,000 PPP borrowers totaling $2.98 billion in loans.
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