Washington (Reuters) – the administration of U.S. President Donald trump touted his small business 660 billion program pandemic assistance this week as the “wild success” data discoveries that showed the initiative saved 51 million jobs.
File photo: U.S. President Donald trump signs a program to protect wages and health care the law on strengthening the financial response to the disease coronavirus (COVID-19) start, in the oval office of the White house in Washington, DC, USA, 24 APR 2020. Reuters/Jonathan Ernst/file photo
But there were red flags throughout the huge set of data that suggested that some borrowers have overstated how many jobs the loan is saved. That, combined with several of these companies did not dispute that they took the loan after the government showed otherwise, have questioned the veracity of 51 million figure.
For example, a Reuters analysis of the data determined that 827 of the companies reported saving at least 400 jobs with a loan of less than 150 000$. Two hundred of these companies reported saving at least 400 jobs with a loan of $ 5,000 or less.
“I’m skeptical of the total number,” said Philip Mutter, Director of the Washington non-profit good jobs first, which focuses on the responsibility of the government.
“I think there was not a lot of rigor that went into reporting these numbers of jobs”.
A senior administration official said that the 51 million figure was an estimate based on the preliminary data of the creditor and that the actual number of saved jobs will be clearer after the borrowers have gone through the procedure of obtaining loans forgiven.
Protection program payroll, supervised by the office of small business (SBA), allows small businesses with 500 people affected by the economic consequences of the pandemic to apply for state support forgivable loan. Data on Monday provided detailed information on almost 4.9 million of loans, including number of jobs, the borrower, the loan helped them save.
These data are released in conjunction with the SBA and the U.S. Treasury on Monday, which is extremely important when evaluating the success of the program, which Congress created to keep workers on the payroll.
In an attempt to get cash quickly for the door, the Treasury and the office of the DPP agreed that borrowers are only required to confirm that the information they supplied for lenders and SBA was accurate.
Except for a limited review, documentation, retention of jobs was not carefully checked, according to interviewed bankers and lawyers who have direct knowledge of the process.
Speaking to reporters Monday, senior administration officials were at pains to stress that the borrower needs to provide accurate information.
Said the matter is one “correct” sign that some borrowers may have falsified figures were 3,728 companies that reported that they have kept exactly 500 people.
As companies are forced to ensure the preservation of jobs estimates for the loan, 878,000 companies reported that no jobs were saved or not to give the number of the analysis of Reuters. This is approximately 18% of all loans.
Reuters and other news agencies also pointed to some of the borrowers listed in the data, including scooter company bird goes ink. and in new York, advent capital Management LLC, which argues that they have submitted or received a PPP loan.
Bird rides CEO Travis VanderZanden tweeted Monday that his company was discussing a loan from the Bank, but decided against it. In addition, the appearance told Reuters he explored in search of credit, but did not comply with the request. But in these their loans transferred accumulated 395 jobs combined.
These differences suggest the data contains a Phantom loans – loans that have been approved by the Directorate, but which have not been paid nor canceled by a creditor, leaving them to linger in the system, the ABS, according to people familiar with the process.
“When you have a list of very few mistakes,” said Mutter.
Reporting Michelle request; editing by Tom Lasseter and Steven Coates