Federal banking regulators should ensure that banks advance financial inclusion, further racial justice in lending and avoid making loans or investments that harm the environment or cause housing displacement, a group of public interest organizations argued today.
WASHINGTON, D.C. – The Paycheck Protection Program, a critical pillar of the CARES Act pandemic relief legislation, failed to equitably distribute money despite an avowed goal of focusing on small businesses, according to a new report from seven public interest organizations and labor unions.
In addition to adopting other reforms for future relief programs, the U.S. Small Business Administration should use its statutory power to claw back improperly issued or misused loans. Those cases might include PPP loan recipients who failed to spend at least 60% of their loan proceeds on employee wages, and cases where recipients used the money to issue stockholder dividends, buy back stock, or award executive bonuses.
AFR joined 39 other organizations urging Congress to staff the five-member panel tasked with monitoring the corporate bailout with members who have experience with oversight and/or investigations and have proven commitment to principles of transparency and accountability.