What does a borrower do after becoming ineligible for the Paycheck Protection Program? | Varying actions by states, countries pose challenges for global contractors during pandemic | Attorneys: First PPP fraud case may be harbinger of future DOJ enforcement
May 13, 2020
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The Small Business Administration has added several new rules and further guidance that might make some current borrowers ineligible for Paycheck Protection Program loans. Such businesses should make a determination by Thursday as to whether they are eligible, and they need to return PPP funds if they determine themselves to be ineligible, attorneys write.
Construction contractors face major challenges during the coronavirus pandemic because of federal and state governments' varying orders and financial mitigation efforts in response to the outbreak. Companies must consider a project's contractual provisions, the jurisdictional implications and any applicable law, according to a law firm report.
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The Justice Department has brought charges against two men accused of fraudulently obtaining Paycheck Protection Program loans. The case "demonstrates that outright fraud will be quickly prosecuted and is a good example of the type of fraud that the DOJ is likely interested in pursuing," two attorneys write.
Businesses that decide to return funds from the Paycheck Protection Program because of questions about their eligibility have alternatives to help sustain their businesses, an attorney writes. Options include employee retention credits and the Main Street Lending Program, he writes.
A new Virginia law makes contractors on large projects liable for subcontractors' wages and establishes contractors as employers of subcontractors' employees when determining criminal and civil liability for unpaid wages. The law also allows employees to sue employers jointly or as part of a class action, with damages to include treble damages when willful violations occur.
NASBP Blog: Paycheck Protection Program -- after the pay comes the chase
The Paycheck Protection Program is important for businesses during the COVID-19 crisis. Applicants must be prepared for possible investigations and audits if they use these government funds. A group of attorneys from Williams Mullen write that these actions may occur months or years in the future and that applicants must be proactive to reduce risk of enforcement. They suggest looking at the Troubled Asset Relief Program from the 2008 financial crisis to see how investigations were handled, as well as meticulously documenting all action taken and keeping up with all the PPP interpretations and changes. Read more.
"Bonding with Bandwidth" May 20 Virtual Event free for NASBP Members, Affiliates, Associates
Make sure to register for next week's NASBP Virtual Event: Bonding with Bandwidth! This complimentary event for all NASBP Members, Affiliates and Associates will be held from 1 p.m. to 4 p.m. Eastern on Wednesday, May 20. The event offers two panel discussions on topics specific to the surety industry -- one on False Claims Act liability implications for surety professionals and the other on industry efforts to obtain electronic bonding acceptance. Don't miss the announcement of the new NASBP Board of Directors for 2020-2021 and presentation of surety industry awards. The event will include remarks from outgoing President John Bustard and from the incoming 2020-2021 NASBP president. Register now to join us on May 20.
NASBP podcast "Let's Get Surety!" examines surviving COVID-19 and economic downturn
Recovery from the financial crisis offers lessons for the construction industry as it prepares to emerge from the coronavirus pandemic. McKinsey identifies seven actions to take in anticipation of a new normal, beginning with a hard look at a changed supply-and-demand dynamic.
Sometimes I dread the truth of the lines I say. But the dread must never show.
Vivien Leigh, film and stage actress
Founded in 1942, NASBP is the association of and resource for surety bond producers and allied professionals. NASBP producers specialize in providing surety bonds for construction contracts and other purposes to companies and individuals needing the assurance offered by surety bonds.