Has anybody heard of the SEC’s requesting info from registrants who’ve disclosed the receipt of PPP funds of their filings?  Particularly, we’ve heard that ENF has been requesting info that may exhibit the registrant’s {qualifications} to obtain PPP funds, together with affect of COVID on the enterprise and its skill to proceed as a going concern.  I’d tremendously admire listening to from anybody who has heard of comparable SEC requests.

That is what the attorneys are circulating.

It’s a “voluntary” inquiry (not a subpoena) out of the House Workplace.

New steerage from SEC in its SBA this morning relating to the “financial uncertainty” certification for PPP loans:


  1. Query: How will SBA evaluate debtors’ required good-faith certification regarding the necessity of their mortgage request?


Reply: When submitting a PPP utility, all debtors should certify in good religion that “[c]urrent financial uncertainty makes this mortgage request essential to help the continued operations of the Applicant.” SBA, in session with the Division of the Treasury, has decided that the next secure harbor will apply to SBA’s evaluate of PPP loans with respect to this situation: Any borrower that, along with its associates, acquired PPP loans with an authentic principal quantity of lower than $2 million can be deemed to have made the required certification regarding the necessity of the mortgage request in good religion. SBA has decided that this secure harbor is acceptable as a result of debtors with loans beneath this threshold are typically much less more likely to have had entry to enough sources of liquidity within the present financial atmosphere than debtors that obtained bigger loans. This secure harbor may also promote financial certainty as PPP debtors with extra restricted sources endeavor to retain and rehire staff. As well as, given the massive quantity of PPP loans, this strategy will allow SBA to preserve its finite audit sources and focus its opinions on bigger loans, the place the compliance effort might yield increased returns.

Importantly, debtors with loans larger than $2 million that don’t fulfill this secure harbor should still have an enough foundation for making the required good-faith certification, primarily based on their particular person circumstances in gentle of the language of the certification and SBA steerage. SBA has beforehand acknowledged that each one PPP loans in extra of $2 million, and different PPP loans as applicable, can be topic to evaluate by SBA for compliance with program necessities set forth within the PPP Interim Remaining Guidelines and within the Borrower Utility Kind. If SBA determines in the middle of its evaluate {that a} borrower lacked an enough foundation for the required certification regarding the necessity of the mortgage request, SBA will search compensation of the excellent PPP mortgage stability and can inform the lender that the borrower isn’t eligible for mortgage forgiveness. If the borrower repays the mortgage after receiving notification from SBA, SBA is not going to pursue administrative enforcement or referrals to different companies primarily based on its willpower with respect to the certification regarding necessity of the mortgage request. SBA’s willpower regarding the certification relating to the need of the mortgage request is not going to have an effect on SBA’s mortgage assure.



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