WASHINGTON–Reports continue to grow of significant errors in the Paycheck Protection Program data released by the Small Business Administration related to which companies have received funds.
Among them: Herb Miller, a one-man business in Hixson, Tenn., who received $3,700. The SBA data indicates he received as much as $5 million.
“Something is screwed up there,” Miller, who has been an accountant for almost five decades, told Bloomberg News. “I’m going to have to get this straightened out.”
According to a Bloomberg News analysis of the PPP loan data released on July 6, which represents some $521 billion in loans, it is “riddled with anomalies. Although the maximum PPP loan for a one-person enterprise is $20,833, more than 75,000 loans listing one job retained have higher amounts – including 154 showing $1 million or more.”
Bloomberg isn’t alone in highlighting errors in the data. As CUToday.info reported here, Ron Shevlin of Cornerstone Advisors also called the data “questionable.”
Other Issues
The Bloomberg analysis pointed out the PPP was designed to keep employees of small businesses on payroll during the pandemic, but it found “out of almost 4.9 million loans, the number of ‘jobs retained’ is zero for 554,146 and blank for 324,122. Seven loans list negative job numbers.”
“Conversely, almost a thousand entries show 500 jobs for loans under $150,000, which is mathematically doubtful given that the aid is based on 2.5 times a firm’s average monthly payroll,” the Bloomberg analysis goes on to state. “In 209 of those cases, it implies an average monthly salary of $4 or less per employee. Taken together, those figures call into question the job numbers in one out of every five PPP loans.”
Noting the PPP is already facing backlash for doling out millions of dollars to big-name law firms, Wall Street managers and companies with ties to President Donald Trump and other politicians, Bloomberg said the new data issues make it difficult to evaluate how well the program worked, especially because the names of borrowers were redacted for smaller loans that account for about 87% of the number of loans.
Issues with E-Tran
Some financial institutions told Bloomberg the problem with the jobs data is that neither the PPP application nor the SBA’s electronic system, called E-Tran, required an input for “jobs retained.” The application had a box for “number of employees,” and some lenders said they submitted that number while others said they left it blank.
Bloomberg News said it spoke to more than a dozen companies that, according to the government, received loans of more than $1 million with a reported one job retained. The borrowers all said there were mistakes in the dataset.