Taxes at work #MostTransparentAdminInHistory https://www.washingtonpost.com/busi...11-billion-taxpayer-backed-coronavirus-loans/ Trump administration won’t say who got $511 billion in taxpayer-backed coronavirus loans Federal officials responsible for spending $660 billion in taxpayer-backed small-business assistance said Wednesday that they will not disclose amounts or recipients of subsidized loans, backtracking on an earlier commitment to release individual loan data. The Small Business Administration has previously released detailed loan information dating to 1991 for the federal 7(a) program, a long-standing small-business loan program on which the larger Paycheck Protection Program is based. The SBA initially intended to publish similar information for the new coronavirus-related loans. An SBA spokesman told The Washington Post in an April 16 email that the agency “intend to post individual loan data in accordance with the information presently on the SBA.gov website after the loan process has been completed,” and it made a similar commitment in response to an April 17 open records request. But the administration appeared to change course at a hearing Wednesday before the Senate Committee on Small Business and Entrepreneurship, as Treasury Secretary Steven Mnuchin and SBA Administrator Jovita Carranza declined to discuss specific borrowers. “As it relates to the names and amounts of specific PPP loans, we believe that that’s proprietary information, and in many cases for sole proprietors and small businesses, it is confidential information,” Mnuchin said in the hearing. “The reason why we’re not disclosing the names and amounts, unlike in the 7(a) program, is because of that issue.” The Post is among 11 news organizations suing the SBA for access to records on loan recipients, amounts of loans and other basic information the agency has previously released. In response to questions from The Post on Wednesday, a Treasury Department spokesman said that disclosing “loan-level data” would risk the confidential business information of loan recipients. “The notion that the administration is hiding something is categorically false,” Brian Morgenstern, a Treasury Department spokesman, said in an email. “The secretary’s point is that loan level data with identifying information would risk disclosing proprietary data of millions of small businesses and the salaries of independent contractors. We are fully committed to transparency while protecting sensitive information,” Morgenstern wrote. The Post’s Freedom of Information Act request does not seek information about salaries. The apparent decision to withhold loan records is the latest of several actions by the Trump administration that could shield the federal coronavirus response from public scrutiny. An unrelated provision in the Coronavirus Aid, Relief, and Economic Security (Cares) Act allows the Federal Reserve chairman, Jerome H. Powell, to request confidentiality for information related to trillions of dollars going to businesses under the auspices of the Federal Reserve. And the Trump administration has taken steps to undermine the independence of executive oversight bodies, declaring that the special inspector general overseeing Cares Act funding cannot submit reports to Congress without “presidential supervision.” Who’s getting these hundreds of billions in government aid? For now, the public may be in the dark. Throughout the Paycheck Protection Program rollout, the SBA has been repeatedly criticized by members of Congress and government watchdog groups for an alleged lack of transparency. “The very first line of defense for the public to make sure the money is being awarded to the businesses that are supposed to be getting it is through transparency,” said Craig Holman, a lobbyist with the advocacy group Public Citizen. “It’s a problem with PPP, but it also goes far beyond that. . . . The entire pandemic response has been defined by a lack of transparency.” The Paycheck Protection Program is a cornerstone of the $2 trillion Cares Act economic stimulus package and the federal government’s broader response to the coronavirus pandemic. The program offers small-business owners low-interest loans that can later be forgiven, with the amount of forgiveness contingent on maintaining employment levels. The loans are processed by private banks and regulated by the Small Business Administration and the Treasury Department. Despite early growing pains, the program scaled up quickly following its launch in early April, helping millions of small businesses keep paying their employees through the economic crisis. It almost certainly contributed to a surprise drop in the national unemployment rate in May. Following messy start, enormous Paycheck Protection Program shows signs of buttressing economy But there is a concern that the SBA’s exceptionally loose application criteria ― a deliberate policy choice that increased demand for the loans and allowed the money to be spent quickly while the crisis deepened ― could have the unintended effect of increasing fraud and abuse. In an effort to streamline the process, the SBA and the Treasury Department allowed lenders to take borrowers at their word regarding their need and eligibility. Although the SBA later said that any loan above $2 million would be audited, business applicants were initially subject to very little vetting. The Justice Department has pointed to allegedly fraudulent transactions among loan recipients. Reality television star Maurice “Mo” Fayne was arrested and charged with bank fraud for spending more than $1.5 million in SBA loan money on jewelry, expensive cars and child support. Fayne received a loan through a Georgia corporation called Flame Trucking. Numerous large businesses and wealthy organizations availed themselves of subsidized small-business loans, which they contend were legal at the time they applied. Well-known restaurant and hotel chains including Shake Shack, Ruth’s Chris Steak House and Ashford Hospitality Trust initially received tens of millions of dollars through their franchises. According to filings with the Securities and Exchange Commission, nearly 300 publicly traded companies received $1 billion in stimulus funding, prompting an after-the-fact ruling from SBA that public companies with access to credit elsewhere would probably not qualify. Many of those businesses subsequently returned the money, although the SBA has declined to say exactly how many did so. Advocacy groups said the decision not to release records could shield other undeserving applicants from public scrutiny. “Clearly, this is meant to prevent some entities from being embarrassed, or being revealed,” said Steve Ellis, president of the advocacy group Taxpayers for Common Sense. “Nobody forced them to take the money, and it was already set up so that they could return it with no questions asked. And they were told that this information would be made public when they applied for the loan.” Watchdog faults SBA on minority-owned and rural small-business relief lending At the Senate hearing Wednesday, members of both parties expressed frustration that they hadn’t been provided the loan records. Sen. Ben Cardin (D-Md.) said Congress needs to have access to the loan data to carry out effective oversight. He also criticized the SBA for not notifying borrowers about important policy changes affecting them. Cardin said the Government Accountability Office, a nonpartisan executive-branch oversight body, was also stonewalled. “How can we know which businesses still need help if we do not know which businesses have received help?” Cardin said. “We need the data to ensure this assistance is as effective as possible.” Senate Republicans at the hearing also expressed frustration that the loan data is not being disclosed, although their concerns focused more closely on reports that Planned Parenthood has received money through the program. The SBA has sent letters to at least a dozen local Planned Parenthood affiliates requesting that they return the money, although it is unclear whether any of them have done so. One Planned Parenthood affiliate told The Post that much of its loan funding had already been spent. Asked about the Planned Parenthood loans by Sen. Josh Hawley (R-Mo.), Carranza, the SBA administrator, declined to discuss the issue. “I have to take the position that I’m not able to share that borrower information at this time,” she said, offering to follow up with him privately. Hawley appeared unsatisfied with that offer and asked why she wouldn’t discuss the issue under oath. “How are we going to conduct oversight if you won’t give us any of the details?” he asked.
business as usual for the corrupt Trump admin. During TARP (Obama Admin) every recipient was publicly disclosed at the Treasury website, the amounts and the amount paid back.
That ambiguous statement was made to calm any fear resulting from Thursday’s sell off. How much money can they just throw at the economy?
While conservatives screamed about our descent into socialism and hyper inflation. Those same voice's silence is deafening this time around isn't it?
It's the same accusation from both: left ot right. They use different arguments though. The absurdity is hilarious. Huffpost accuses Twitter of double standards for one reason, and Britbart cries the same uncle for another. I am sure Jack has fun, narcissists need perpetual attention regardless. They have a score with this world to settle. We are just being used. Not much new. Wait for November 4...
https://www.reuters.com/article/us-...a-pandemic-bailout-its-a-secret-idUSKBN23N1OG Did elite David Boies law firm get a pandemic bailout? It's a secret (Reuters) - When the U.S. government announced a multibillion-dollar bailout of struggling small businesses amid the coronavirus pandemic, one of the top U.S. law firms sensed an opportunity. Leaders of the high-profile firm founded by David Boies circulated an email asking shareholder partners to authorize the firm to seek up to $20 million in forgivable government loans, two sources familiar with the matter told Reuters. Boies Schiller Flexner, where partners commonly earn seven-figure compensation, is known for representing Hollywood producer Harvey Weinstein against sexual-assault accusations and companies ranging from Oracle to Theranos. The firm declined to comment on whether it actually applied for or received the money under the U.S. government’s Paycheck Protection Program. And the government won’t say - because of a policy that keeps all such applications and awards secret. The U.S. Small Business Administration (SBA), which oversees the program, declined to comment on whether Boies Schiller has applied for a PPP loan. The agency previously told Reuters that it would post individual loan data when its current round of PPP funding runs out. But it did not say whether that data will include borrower names or amounts or detail what it plans to release. U.S. Treasury Secretary Steven Mnuchin told the U.S. Senate’s small business committee on Wednesday that borrower names and amounts received would not be made public, calling the information proprietary and confidential. Critics say the government is violating public records laws and handing out billions of dollars in taxpayer money with no public accountability. Several major news organizations, including The Washington Post and The New York Times, have sued the SBA in Washington D.C. federal court, arguing that borrowers’ names and loan amounts are legally public. Reuters is not among the plaintiffs. They point out that the SBA has for years released such information on borrowers receiving loans under other programs. The SBA said on Friday in a court filing that some or all of the documents and information the plaintiffs have requested are exempt from disclosure under the Freedom of Information Act, without specifying which ones. Confusion over the program’s disclosure rules deepened on Tuesday when Republican Senator Marco Rubio, of Florida, tweeted, “We will have #PPP loan disclosure” and that there is “no dispute over larger loan recipients being disclosed.” Rubio is chairman of the Senate’s small business committee. A spokesman for the senator, Nick Iacovella, did not comment on what information Rubio wanted disclosed or whether it would include recipients’ names and loan amounts. Iacovella said Rubio “plans to work closely with SBA and Treasury to ensure enough data is disclosed about the program to determine its effectiveness ... without compromising borrowers’ proprietary information.” The Treasury Department and the White House did not immediately respond to requests for comment. In a statement to Reuters, Democratic Senator Elizabeth Warren, of Massachusetts, called it “absurd” that the administration is “handing out more than $500 billion of taxpayer funds in secret.” To apply for a loan, applicants must certify that they need the cash to cover basic needs such as salaries and rent and that “current economic uncertainty makes this loan necessary to support” ongoing operations. With some exceptions, companies have to have 500 or fewer employees to be eligible. Companies do not have to pay back the loans as long as they spend the money on eligible expenses. PPP loans are capped at $10 million. The two sources, who declined to be identified, said they did not know why Boies Schiller asked its partners about applying for double that amount. Some applicants have sought and received multiple loans by making applications through more than one subsidiary. The April email from the managing partners seeking partner approval caused concern among some of the firm’s members, the two sources said. Some partners believed that the firm’s leadership had not been transparent about its finances and that it might not need the money, the sources said. Boies Schiller does not disclose its financial information, but last year its shareholder partners earned an average of more than $3 million, according to the American Lawyer. FILE PHOTO: Attorney David Boies (R) talks to reporters outside the Supreme Court in Washington, after the court handed a significant victory to gay rights advocates by recognizing that married gay men and women are eligible for federal benefits and paving the way for same-sex marriage in California. June 26, 2013. REUTERS/Jonathan Ernst/File Photo Managing partners Nicholas Gravante and Natasha Harrison followed up with lawyers who didn’t immediately respond to the April email, sources said. Since the launch of the PPP, some companies, such as Shake Shack and Ruth Hospitality Group Inc, have reported receiving funds in regulatory filings. Both companies have said they will return the money, in response to public backlash against big companies taking the loans even though they have other means of funding not available to small businesses. The SBA has said it will audit loans over $2 million. Unlike public companies, which must periodically report on their finances, private law firms have no such requirements. The coronavirus pandemic has hit many U.S. law firms hard. More than 25 of the 200 top grossing U.S. law firms, according to the American Lawyer, have laid off or furloughed employees since March. The U.S. legal sector lost a net 62,800 jobs from March to May, according to data from the Bureau of Labor Statistics. Boies Schiller declined to comment on whether and to what extent the pandemic has impacted its finances. Founded in 1997, Boies Schiller has about 245 lawyers in the U.S. and U.K. according to the firm’s website. In 2019 the firm grossed $405 million, according to the American Lawyer. At least some of its partners bill more than $1,000 an hour, a source familiar with the firm said. Boies, the firm’s chairman, is well-known for representing the U.S. government in antitrust litigation against Microsoft Corp and former Vice President Al Gore in the U.S. Supreme Court case over the 2000 presidential election recount. He more recently advised failed blood-testing startup Theranos and Weinstein, who was convicted of sexual assault and rape in a New York court in February. The firm’s reputation has recently suffered in the wake of media reports that Boies had used aggressive tactics to defend clients, including hiring the Israeli private intelligence firm Black Cube to quash negative publicity about Theranos and Weinstein. It declined to comment on the reports. Since January, more than 25 partners have left the firm, Reuters has reported, including two top litigators who jumped to another firm last week. Leaders of the firm have said many of the departures are tied to an internal restructuring.
breaking: http://www.politico.com/news/2020/06...ss-loan-320625 Members of Congress took small-business loans — and the full extent is unknown According to a report from Politico, at least four members of Congress and their families cashed in on the multi-billion small business loan program set up to support companies hammered by the shut down during the still ongoing coronavirus pandemic. As the report notes, they might not be the only ones. According to the Politico report, “It’s a bipartisan group of lawmakers who have acknowledged close ties to companies that have received loans from the program — businesses that are either run by their families or employ their spouse as a senior executive.” The report notes the four include two Democrats and two Republicans including Rep. Roger Williams (R-TX), who owns several auto dealerships, body shops and car washes, and Rep. Vicky Hartzler (R-MO), “whose family owns multiple farms and equipment suppliers across the Midwest.”
reportedly comp is worth 120 million https://www.washingtonpost.com/business/2020/07/01/treasury-loan-yrc-worldwide-cares-act/ In unusual deal, U.S. Treasury to acquire 30 percent of trucking company in exchange for $700 million loan YRC Worldwide helps the military with transportation needs, the government said The Treasury Department announced Wednesday that it will loan $700 million to a trucking firm that ships military equipment, in exchange for having U.S. taxpayers acquire an almost 30 percent stake in the company. Under the unusual arrangement, the Treasury Department will provide the emergency loan to YRC Worldwide, while taking a 29.6 percent equity stake in the company. The U.S. government does not typically take ownership stakes in companies but was given permission to do so by Congress as a way to ensure taxpayer funds are not misspent. The deal is the first under a $17 billion loan program approved as part of the broader stimulus by Congress in March. That pot of money was earmarked for firms deemed “critical” to U.S. national security. Congress gave Treasury the authority to approve more than $500 billion in emergency loans to companies and cities, although most of that money has not been disbursed. “We are pleased for Treasury to make this loan pursuant to the CARES Act,” Secretary Steven Mnuchin said in a statement. “This loan will enable a critical vendor to the Department of Defense to maintain significant employment while providing appropriate compensation to taxpayers.” YRC Worldwide is a publicly traded company headquartered in Kansas. With a fleet of about 7,600 tractors and 30,000 trailers, YRC is one of the largest “less-than-truckload” transportation companies in North America. The 96-year-old company covers 68 percent of the military’s services in that area, according to the Treasury Department’s announcement. The investment could intensify questions over Treasury’s handling of hundreds of billions in taxpayer aid at a pivotal moment for the U.S. economy. Some critics have said Treasury’s interventions amount to a large corporate bailout for undeserving firms, while others have argued the money should be more swiftly distributed with fewer conditions to avert rising unemployment. Treasury did not spend any of the $17 billion for more than three months, raising questions about the program’s effectiveness as companies sought other means of funding. The Cares Act requires that companies receiving help through the fund give the government an equity stake or a warrant, a financial instrument that allows the lender to claim stock at a later date. Wes Hallman, vice president at the National Defense Industrial Association, said he is aware of approximately 20 companies that applied for relief through the fund, a relatively small number for a massive, sprawling industry. Most defense contractors considered the terms too onerous, defense executives and lobbyists told The Washington Post. “There are too many bells and whistles going in the wrong direction, and major aerospace companies just aren’t interested” in the fund, said Arnold Punaro, a retired Marine Corps general who works as a defense consultant. “If this were a good deal for our aerospace companies, they would be using it.” Senate aid package quietly carves out billions intended for Boeing, officials say Although many companies were financially desperate as the crisis deepened in late March and early April, many of them found other options. Numerous defense contractors found relief through other Cares Act programs. A handful of defense suppliers received Paycheck Protection Program loans backed by the Small Business Administration, which have no equity requirement and have the option of being forgiven. The Defense Department is spending $668 million in Defense Production Act funding on the defense industrial base. That funding is being meted out through existing, open contracts that don’t have to be renegotiated and don’t require any equity stake. With capital markets improving throughout April and May, some companies found other options through private markets. “When the Cares Act passed, most defense companies looked at the program as an option, but most determined that the conditions associated with the loan program were so restrictive it made obtaining capital through other means a better option,” said Jeff Green, a lobbyist who works with several defense firms that considered applying. One company that passed on government help is Boeing, the battered aerospace manufacturer and defense contractor whose finances have been wrecked by the global slowdown in commercial air travel. Mnuchin and people involved in the drafting of the Cares Act have said the $17 billion pot of money was initially intended in large part to help shore up Boeing. However, the company was able to raise sufficient funds to stay afloat through the private credit markets, which were aided by the Federal Reserve’s extraordinary measures, although the company has also laid off thousands of workers. A Treasury statement said the loan will allow YRC to keep about 30,000 trucking jobs and “continue to support essential military supply chain operations” used by more than 200,000 companies in North America. The department also cited a certification from the defense secretary about YRC’s critical value for national security. The agreement includes limits on executive compensation and dividend payments to shareholders, but Treasury has not disclosed what those are. Like most transportation companies, YRC was sharply affected by the state-by-state business closures that put the national economy into stasis throughout March and April. The company finished the first quarter of 2020 with $1.15 billion in revenue, down slightly from the same period last year. Lower volume across its commercial freight business has cut into the company’s bottom line, forcing layoffs and other cost-cutting measures. But the company’s debt is a larger concern; YRC owes $825 million to various creditors, according to its most recent financial statement. In a May 5 call with analysts, YRC chief executive Darren Hawkins thanked employees for keeping the U.S. supply chain moving despite “the invisible enemy,” echoing a term commonly used by President Trump. He declined to take questions from analysts, marking a significant break from usual practice. “I don’t know of a more patriotic industry than trucking, and that spirit has stood strong in America’s transportation networks,” Hawkins said. In a news release, Hawkins thanked Congress and the Treasury Department for providing financial assistance to see YRC through the crisis. “This financial assistance will enable us to bridge this pandemic-related crisis and continue to provide essential shipping services for the nation’s supply chain,” Hawkins said. While it is unusual for the U.S. government to acquire parts of companies, such arrangements are common internationally and help governments ensure that taxpayers receive a return for their investment. If the price of YRC’s stock goes up, taxpayers will also benefit as a traditional investor would. “During this crisis, the government should not let companies fail, but it also should not bail out the wealth of their owners. Providing loans for equity accomplishes exactly this,” said Matt Bruenig, founder of the left-leaning People’s Policy Project. The agreement will probably lead to criticism that U.S. taxpayers are providing special assistance to firms that should not receive help. Darrick Hamilton, a professor at Ohio State University, noted the emergency help comes as protesters in major U.S. cities are calling for cuts to spending on the police and the armed forces. The U.S. government already provides more than $700 billion annually for the military. “The government is supposed to be dealing with social welfare but is spending money on militarization and policing,” Hamilton said. “This is indicative of our general values of where we spend our money."