All PPP Borrowers Information Released Under the FOIA
When the Payroll Protection Program (PPP) was rolled out in April 2020, it was not part of the plan for all recipients of the loan to be disclosed publicly. That was, until the Small Business Administration (SBA) faced lawsuits and pressure from Congress, the media, and the public to make the names of the loan recipients public information under the Freedom of Information Act (FOIA).
This pressure worked and in early July, the SBA and the U.S. Treasury released the information of all PPP recipients who received a loan over $150,000. The released information includes the name and address of each borrowing business, the business structure, demographic data, number of employees, and the identity of the lender.
While the borrowers that were disclosed accounted for around 75% of the total PPP money loaned, it only accounted for about 15% of the borrowers that received a PPP loan. In November of this year, a federal judge ruled that the SBA must release the information of all PPP loan recipients. That means that any business that received a PPP loan, no matter what size, will have their information disclosed to the public.
In his recent Morning Musings video, Reinhard von Hennigs, the Chairman and Founder of BridgehouseLaw had a couple of takeaways for small businesses that received PPP loans.
- Be prepared for media attention. Local media outlets looking for a story may ask you what you did with your PPP loan. Be aware of this possibility and have a good answer prepared. If you don’t wish to comment, simply say “no comment.”
- The disclosure of your business’ information could lead to potential scammers using this information to defraud you. They could contact you, purporting to be your bank or the SBA, and try to get sensitive information out of you. For example, someone could call to discuss your PPP loan and ask you to “confirm” the business’ EIN or account number for “security” purposes.
In conclusion, all recipients of a PPP loan should know that certain information about their company is already public or soon to be public. Recipients should also be aware of the fact that media outlets may contact you for a story, and scammers may attempt to trick you into revealing sensitive information.