A watchdog panel of government inspectors general is asking the Small Business Administration to provide the names of borrowers who received Paycheck Protection Program loans of $25,000 and up, citing a 2006 law that requires their disclosure.
The request is being made by the Pandemic Response Accountability Committee, a panel of inspectors general from across the government that is responsible for ensuring relief funds appropriated under the $2 trillion CARES Act and other pandemic relief measures are being spent appropriately.
The 2006 Federal Funding Accountability and Transparency Act says that loans, grants, contracts and other forms of federal financial assistance totaling $25,000 or more must be disclosed on a publicly searchable website, USASpending.gov. The disclosures must include the name of the entity receiving the award, the amount of the award and other relevant details.
The SBA contends that disclosing the names of loan recipients could violate their privacy because PPP loans are scaled to the size of a business’s payroll.
“SBA is acting, consistent with legal requirements, to protect this sensitive information for small businesses,” the agency said.
But advocates for disclosure say it is important to gauge the program’s effectiveness. Publicly traded companies, big law firms, government contractors with steady incomes, companies accused of fraud, private-equity firms, hedge funds and luxury real-estate developers all participated in the program aimed at supporting small businesses.
In July and August, the SBA disclosed the names of borrowers receiving PPP loans of $150,000 or more along with loan ranges across five categories ranging from $150,000 to the maximum of $10 million.
Releasing the names of all those who received loans of $25,000 or more would have led to disclosure of about 1.8 million additional recipients, according to Wall Street Journal estimates.
Source: Wall Street Journal