Thousands of businesses and independent contractors received Paycheck Protection Program (PPP) loans as part of the CARES Act to support business operations in uncertain times. Now the U.S. Treasury and Small Business Administration (SBA) have launched a campaign to investigate recipients of these loans.
If your loan eligibility or forgiveness application is being scrutinized in a PPP loan audit, do not wait to contact Attorney Ronald Arthur Stearns Sr. in Austin or San Antonio. Any borrower may be subject to an SBA audit, but those who received more than $2 million will be reviewed automatically. Whatever your situation may be, Attorney Stearns can help.
Do Not Try To Represent Yourself During The Investigation
The SBA will review, among other things, the economic necessity of the PPP loan, but the guidelines for “economic necessity” remain unclear. This ambiguity seems to be intentional, allowing the SBA to look into a wide variety of factors when determining a loan recipient’s eligibility.
In general, an audit of a PPP loan will scrutinize:
- Whether the borrower was eligible to participate in the program
- Whether the loan amount was calculated correctly
- Whether the loan proceeds were spent on allowable uses
- Whether the borrower is eligible for loan forgiveness
The scope of such an audit could be far-reaching. It is crucial that you do not try to represent yourself during the audit or simply rely on an accountant to explain the process. If you are contacted by the SBA regarding a PPP loan audit, you should have an experienced, dedicated audit defense lawyer on your side to prepare a response and protect your rights and interests throughout the investigation.