Democratic members of the Select Subcommittee on the Coronavirus Crisis are asking the Treasury Department, Small Business Administration and eight national banks to turn over documents and information about Paycheck Protection Program loan distribution.
The lawmakers sent letters to the Treasury Secretary Steven Mnuchin, SBA Administrator Jovita Carranza and the CEOs of JPMorgan Chase, Wells Fargo, Citigroup, Santander, U.S. Bancorp, Bank of America, Truist and PNC on Monday.
The committee said it’s investigating whether the program designed to keep small businesses afloat during the pandemic has favored large, well-funded companies over small businesses in underserved communities.
“Media reports indicate that some large lenders apparently created a two-tier system for processing PPP loan applications. The banks’ wealthiest clients had access to a personalized application process that ensured their applications were processed first. Other applicants had to use poor-performing electronic portals, faced significant processing delays, and sometimes needed to find another lender to consider their application,” wrote the lawmakers.
The House established the special panel to oversee the roughly $2 trillion CARES Act and make sure taxpayer dollars are being spent efficiently. House Speaker Nancy Pelosi tapped Majority Whip Jim Clyburn (D-SC) to lead the subcommittee.
The Democratic members are asking the banks to provide documents and information, including guidance from SBA and Treasury regarding PPP requirements, internal communication and communication with SBA and Treasury about the prioritization or exclusion of applicants and internal policies and training materials regarding procedures for processing or expediting PPP loans.
The lawmakers also want a list of all the PPP applications each bank received and details on how the institutions made sure loans went to underserved and rural markets. The panel is asking banks to turn over the information and brief Congressional staff by June 29.
Jessica Smith is a reporter for Yahoo Finance based in Washington, D.C. Follow her on Twitter at @JessicaASmith8.