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Possible PPP Loan Abuse?

Old 09-08-2020, 01:50 PM
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Default Possible PPP Loan Abuse?

I work for an industrial service company with 9 locations nationwide that claims to be a small business. In late March, they furloughed all but ten hourly workers with the exception of secretaries and admin, which are average about 3 per location. Of the ten, including myself, the guaranteed hours were cut from 40 per week to 40 every two weeks (one pay period). In mid April, they were approved for a PPP loan for somewhere between $2-5m, and claim to have used it to retain 252 jobs. They just brought most employees back to work in early August. I believe they have at least misused the money based on info I found and what I know. I made it known to my Branch manager over this Labor Day weekend and since then, a meeting with the COO and VP has been scheduled at our branch for tomorrow for everyone at our office to attend. Heís about as pissed about it as I am. He swears he didnít tell them what employee(s) brought this to the surface. He claims they want to be able to answer any questions we have regarding the issue. I donít wanna ask questions because so far Iím the only one that knows about it, so thatís gonna give it away, and I think they might try to hold that against me. Iím thinking about reporting them or whatever it takes for them to be held accountable, but only if they did actually spend the money on something it wasnít intended for or something similar. They really screwed us over and I just want them to get what they deserve if they did in fact abuse the money. Anybody know more about this kind of thing and if I should move forward in pushing the issue? Thanks in advance.

Last edited by iFish02008; 09-09-2020 at 01:17 PM. Reason: Poor choice of words.
Old 09-08-2020, 01:56 PM
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This is the exact same place I would come to if I needed legal advice.
Old 09-08-2020, 02:00 PM
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The rules have changed how the PPP loan is forgiven. Perhaps they are waiting to use the 24 week qualifying period not the 8 week.

Remember in order for the loan to be forgiven it must meet certain requirements over either an 8 or 24 week period including the FTE(full time equivalent) employment.

I would just ask when they will be returning you to full time status since you were furloughed not terminated. Throwing the fraud word around isnt the way to approach this until you know ALL the facts
Old 09-08-2020, 02:01 PM
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From what I understand its a loan you have to pay back if you don't follow the rules and if you follow the rules the loan is forgiven. From my understanding the only fraud that would occur is if they gave the government false records to make it look like no now was laid of or reduced.
Old 09-08-2020, 02:05 PM
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If they got between $2-5 mil they will get an audit. If they did anything wrong it will come to light during the audit.

https://www.sba.gov/partners/contrac...ud-waste-abuse
Old 09-08-2020, 02:08 PM
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Good luck and I hope it gets resolved to your benefit.

By the THT way, did any of the owner/manager buy a big boat with quad Verados?
Old 09-08-2020, 02:08 PM
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Settle down there cowboy. Lawsuit against your company? For what? You don't even really have any details. Are they truly committing fraud on their paperwork for the PPP loan? If so, how do you know?

Keep in mind they have 24 weeks from when the loan was received to spend the money. Generally, companies received 2.5 months of payroll. You can also spend 40% of that money on non-payroll expenses (rent, etc.).

Feel free to ask questions to the big wigs but it sounds like you are outside your lane on your understanding of the PPP and the rules.
Old 09-08-2020, 02:13 PM
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I think your 20 hours a week just went to 0. I would spend this holiday job hunting. I know the employees of most companies have no idea what is really going on behind the scenes. The company may have multiple other segments and branches unknown to you, that are being staffed. You have no idea what they are really doing nor should you unless you are in upper management. One thing is for certain they will know were your loyalty does not lie now for sure.
Old 09-08-2020, 02:53 PM
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Originally Posted by ChannelTwo View Post
Settle down there cowboy. Lawsuit against your company? For what? You don't even really have any details. Are they truly committing fraud on their paperwork for the PPP loan? If so, how do you know?

Keep in mind they have 24 weeks from when the loan was received to spend the money. Generally, companies received 2.5 months of payroll. You can also spend 40% of that money on non-payroll expenses (rent, etc.).

Feel free to ask questions to the big wigs but it sounds like you are outside your lane on your understanding of the PPP and the rules.

I agree and quite frankly really not your concern how they spent they money, they are liable for repayment if they did not meet the criteria plus for an amount that large there will be a thorough SBA audit


Apparently you do not wish to work there anymore
Old 09-08-2020, 04:29 PM
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Originally Posted by ChannelTwo View Post
Settle down there cowboy. Lawsuit against your company? For what? You don't even really have any details. Are they truly committing fraud on their paperwork for the PPP loan? If so, how do you know?

Keep in mind they have 24 weeks from when the loan was received to spend the money. Generally, companies received 2.5 months of payroll. You can also spend 40% of that money on non-payroll expenses (rent, etc.).

Feel free to ask questions to the big wigs but it sounds like you are outside your lane on your understanding of the PPP and the rules.
I understand that I need more details. But I do have two important facts that paint a picture. That being that they 100% for certain furloughed almost every employee right before being approved for the loan that was absolutely not used for payroll. And thatís against everything Iíve read about the PPP loans and itís rules. If Iím out of my lane then Iíd like to know how. And to the ones saying itís not my business, well sorry but it is my business and I deserve to know. Iíve been a crucial part in building this company to what it is now, which is only 6 years old. But regardless, IF they broke the law, then why is that ok? Thatís why Iím here asking questions. The loan has its intent in the name itself, which it wasnít used for. Keep in mind we also made profits during this time period. We already operate with very low overhead, so by cutting the payroll to almost nothing, they were able to keep manpower to workload ratio sufficient. If they will for sure be audited then Iím good with that. I just want it to be made right to the guys that went this whole time without a check, which I doubt will ever happen. Sure they got the unemployment with the federal money on top, but most of these guys make much much more than that, and some are now in a real financial pinch. I think it was wrong for them to be furloughed while the company gave them no help, even though they got a loan that was created just for that.
Old 09-08-2020, 04:41 PM
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I canít stand people like you.

no disrespect
Old 09-08-2020, 04:47 PM
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There is one other detail that I forgot to mention. As part of the furlough, the company would cover insurance costs until brought back to work, and the employees would then have to start paying that back, over a period of one year. Well that was changed when they were brought back, and now they donít have to pay it back. I was happy to hear that, and I hope thatís what some of the loan went towards. But it still doesnít come close to $1.2m.
Old 09-08-2020, 04:47 PM
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Originally Posted by AsurfAholic View Post
I canít stand people like you.

no disrespect
X2. Sounds like you should be thankful they kept you in the payroll at all.

$2-3M PPP on that size of a company isnít going to keep the lights on and doors open for more than a week or two. Sounds like management is doing what they can to ensure the company survives. The PPP parameters for forgiveness are totally different than the loan part.
Old 09-08-2020, 04:49 PM
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OP, what they got in the PPP is the first step, and even if they use none of it as planned as long as they state that on the forgiveness paperwork it becomes a loan. There really can't be fraud until the forgiveness paperwork is sent in. And as stated, they now have 24 weeks to use it.

As others stated, stay in your lane.
Old 09-08-2020, 04:54 PM
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Originally Posted by AsurfAholic View Post
I canít stand people like you.

no disrespect
I donít care for blowboaters much either. So I guess itís mutual.
Old 09-08-2020, 04:59 PM
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Nobody has been granted loan forgiveness as of yet. Mind your own business. The audit or the paperwork required for the forgiveness application will either substantiate the loan proceed use or it will not. Either way, it is none of your business.

File a lawsuit? You think you are going to file a qui tam action? You sound like Adam Schiff...you just know it, but have no proof of anything. Find another job. You would be done at my company.
Old 09-08-2020, 05:01 PM
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Originally Posted by iFish02008 View Post
I donít care for blowboaters much either. So I guess itís mutual.
Thatís the best you can come up with?

Fact #1

its none of your business about what the inner workings of your employerís financial situation looks like.

fact #2

you sound like a karen
Old 09-08-2020, 05:01 PM
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I think this is what you're really looking for?
Old 09-08-2020, 05:12 PM
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Originally Posted by LessImpressed View Post
Nobody has been granted loan forgiveness as of yet. Mind your own business. The audit or the paperwork required for the forgiveness application will either substantiate the loan proceed use or it will not. Either way, it is none of your business.

File a lawsuit? You think you are going to file a qui tam action? You sound like Adam Schiff...you just know it, but have no proof of anything. Find another job. You would be done at my company.
Did I touch a nerve or something? Iím trying to find out if they purposely screwed their employees. Coworkers and friends of mine.
Old 09-08-2020, 05:17 PM
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Originally Posted by AsurfAholic View Post
I canít stand people like you.

no disrespect
x2

has no equity yet thinks itís his business.

I would fire his ass on general principal.

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