Sponsored by Cross River Bank
By the end of May 2021, the government distributed more than $275 billion in PPP funds to businesses across the country through the Paycheck Protection Program (PPP). About the same time, stories emerged about hundreds of greedy and unscrupulous business owners who managed to secure loans through nefarious and illicit methods.
For example, earlier this year, resident hood rat cast member of Maurice “Mo” Fayne, of the popular VH1 show, Love & Hip Hop Atlanta, pleaded guilty to fraudulently obtaining millions from the government under PPP. According to court documents filed in May 2020, Fayne applied for a PPP loan of about $4 million with United Community Bank. He claimed to be the sole owner of Flame Trucking—an Atlanta-based trucking and transport company. Fayne told the bank his company had more than 100 employees and an average monthly payroll of about $1.5 million. Federal investigators discovered the company did not exist, and Fayne fraudulently obtained the funds. He used the money for personal expenses. Fayne bought jewelry, including a Rolex watch and a diamond ring. He also leased a Rolls-Royce and used some of the money funds to pay back child support. In September, he was sentenced to 17 years in prison and ordered to repay a portion of the funds.
While such egregious and blatant examples of abuse of PPP may be rare, some New Jersey-based minority and women-owned business enterprises (M/WBE’s) credit the program for helping their businesses to survive. “I applied for and received funds from PPP and it helped sustain and maintain my business through the pandemic,” said Joshua Suggs, owned of Delta’s, a popular restaurant and bar in New Brunswick, NJ. “We are almost back to where we were in terms of revenue, volume and staff prior to March 2020 and the pandemic. Without the CARES program and government funding, I’m not sure if we could have survived.”
Finally, the economy continues to rebound and sputter in many cases as a potentially more virulent strand of the coronavirus spreads. PPP lenders offer loan forgiveness to struggling small business owners in some instances. For example, Cross River Bank, based in Fort Lee, was the second-largest PPP lender in the country. For PPP loans received in 2021, the bank has an online portal to apply for loan forgiveness. For loans received last year, visit the bank website for more information. https://www.crossriver.com