Paycheck Protection Program scams being investigated following fraudulent applications
DELMARVA – A new study launched by the Federal Reserve Bank of St. Louis looked into the Paycheck Protection Program.
The program launched about 2 years ago with the mission of helping small businesses keep their employees paid. However, some people committed fraud to get that funding and now the department of justice is involved.
“It saved millions of jobs across the country and it saved so many jobs here on the lower shore,” says Salisbury Area Chamber Commerce President Bill Chambers.
He tells 47 ABC the funding was set out to help small businesses across the nation.
“PPP was intended for use in payroll so it was intended for you as a business or organization to retain your employees and continue to pay them at the same rate they were before the pandemic struck and closures occurred,” says Chambers.
Though the fund was intended for good in some cases it was abused, going as far as committing fraud to get the money. Local accountant with UHY, Mark Welsh says he wasn’t surprised.
“As hindsight as this thing is, now that this thing is pretty much at the end of the program where pretty much all of the money is spent and forgiven at this point, what they’re finding out is that it was a very inefficient program, that there was a waste, fraud abuse of the program,” says Mark Welsh.
“The issue that the federal government is dealing with now is there’s about 80 billion (dollars) in fraud according to the department of justice the PPP loans were different than traditional small business administration loans. It was a huge program,” says Chambers.
That funding comes directly from your American tax dollars and Welsh says there may be concerns that spark from that as a taxpayer.
“So as a taxpayer, you may be a little upset that your taxpayer money, the money that you pay that comes out your paycheck every week, that went into the general fund only 25 percent of that money went for its intended purposes,” says Mark Welsh.
Chambers says though they have run into this issue without this funding things could have been a disaster for businesses on the shore, as this funding has helped so many in resort towns continue to get paid. Welsh says while tax dollars come out regardless if you are seeing these issues you can still speak up and report any fraud or related issues to the united states government accountability office. The issue is being handled but if you have an active application for loan forgiveness, be sure to check in with your bank or the united states business administration for application updates.
