- The Washington Times - Tuesday, April 28, 2020

Treasury Secretary Steven T. Mnuchin on Tuesday pledged a “full audit” of loans through a new small business program that are worth more than $2 million and said borrowers will face criminal liability if they misled the federal government.

“We will make sure that what was the intent for taxpayers is fulfilled here,” Mr. Mnuchin said on CNBC.

Mr. Mnuchin said banks have largely been acting as middlemen for the “Paycheck Protection Program,” where companies can apply for loans that are forgiven if the money is used to retain employees and make payroll amid the coronavirus pandemic.

“It’s the borrowers who have criminal liability if they made this certification, and it’s not true,” he said. “We’re going to do a full audit of every loan over $2 million.”

“This was a program designed for small businesses — it was not a program that was designed for public companies that had liquidity,” Mr. Mnuchin said.

The Treasury Department recently clarified that public companies with ready access to capital would be unlikely to justify applying for the money.

“I never expected in a million years that the Los Angeles Lakers — I’m a big fan of the team, but I’m not a big fan of the fact that they took a $4.6 million loan,” he said. “I think that’s outrageous, and I’m glad they’ve returned it, or they would have had liability.”

The Small Business Administration started taking PPP applications again on Monday after Congress last week replenished the program with more than $300 billion.

As with the first round of funding, banks and applicants again reported significant difficulties in navigating the system.

President Trump is scheduled to hold an event at the White House later Tuesday with small businesses that successfully applied for the funds.

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