(The Center Square) – As more information comes out about the recipients of the Paycheck Protection Program, Congressional Republicans have called for a fraud investigation into how hundreds of unions received $36 million in forgivable loans.
In Pennsylvania, about $1.2 million in PPP loans were claimed by unions despite being legally unable to receive funds. The government has yet to investigate how, exactly, the loans were approved.
The PPP loans were made quickly by the Small Business Administration in the early days of the pandemic to avoid mass layoffs. Yet the speed in which $800 billion of taxpayer money was doled out left the program liable to waste, fraud, and abuse. An NBC News investigation estimated the cost of fraud at $80 billion, or 10% of the overall fund. That’s in addition to a $900 billion COVID-19 relief fund that may have been defrauded of $90 billion-$400 billion.
“Even if the highest estimates are inflated, the total fraud in all COVID relief funds amounts to a mind-boggling sum of taxpayer money that could rival the $579 billion in federal funds included in President Joe Biden’s massive 10-year infrastructure spending plan,” Ken Dilanian and Laura Strickler wrote.
PPP loans were restricted to businesses, yet unions were able to obtain millions of dollars nationally, as The Center Square previously reported. In Pennsylvania, the following unions received loans:
PA AFL-CIO ($267,762).
- The Training And Education Fund ($187,900).
Operating Engineers Local 66 AFL-CIO ($180,100 in 2021).
Operating Engineers Local 66 AFL-CIO ($180,100 in 2020).
- UFCW Local 1776 ($171,822).
Teamsters Local Union No. 77 ($86,900).
IBEW Local 375 ($46,880).
IATSE Local 489 ($40,251 in 2021).
- IATSE Local 489 ($28,400 in 2020).
Graphic Communication Union Local 4C ($23,100).
Now, Congressional Republicans Virginia Foxx of North Carolina, Blaine Luetkemeyer of Missouri, Rick Allen of Georgia, and Beth Van Duyne of Texas have sent a letter to the SBA requesting an investigation into how those entities were approved. In it, they request information on how many labor organizations received PPP loans, the total dollar amount of those loans, and ask the SBA to account for its auditing process on the loans.
The letter comes after a report from the Freedom Foundation highlighted the loans. An inspector general of the SBA has also reported to the administration about these issues, recommending that the SBA “assess vulnerabilities in internal controls and strengthen or implement necessary internal controls to address ineligible loans and potential fraud."