Companies seeking aid from the next round of small business relief will be required to attest to their need for the loan and could be asked to prove it, as the Trump administration seeks to prevent mom-and-pop operations from being crowded out.
New guidance released Thursday by the Treasury Department and the
The guidance was issued after small businesses complained that large, publicly traded companies and big chains were
“It is unlikely that a public company with substantial market value and access to capital markets will be able to make the required certification in good faith, and such a company should be prepared to demonstrate to SBA, upon request, the basis for its certification,” the guidance says.
Lenders may rely on a borrower’s certification, and borrowers that previously applied for a PPP loan and repay it in full by May 7 “will be deemed by SBA to have made the required certification in good faith,” according to the guidance.
Chains including Shake Shack and
Mnuchin said he’s giving other companies the benefit of the doubt that they didn’t understand the conditions of the program.
“If you pay back the loan right away, you won’t have liability to the SBA and to Treasury,” Mnuchin said at the White House briefing on Tuesday. “But there are severe consequences for people who don’t attest properly to this certification.”
The PPP offers loans of as much as $10 million that convert to grants if proceeds are used to keep workers on the payroll and cover rent and other approved expenses for about two months, a stopgap designed to help businesses get by until the economy reopens.
Dallas hotel executive
(Updates with additional details from first paragraph)
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