An Alabama-headquartered bank with $157.4 billion in consolidated assets has agreed to settle allegations stemming from its pandemic-era business loan forgiveness.
US Department of Justice He says That on or about August 3, 2021, Regions Bank approved forgiveness of the customer’s Paycheck Protection Program (PPP) loan.
Congress created the PPP in March 2020 to provide federally guaranteed loans to small businesses facing economic uncertainties due to the COVID-19 pandemic.
Eligible borrowers can later request forgiveness of their loan provided they use the funds for employee payroll and other eligible expenses. The U.S. Small Business Administration (SBA) then pays the principal and interest loan balance to the lender.
Regions Bank is accused of unjust enrichment for receiving payments from the Small Business Administration (SBA) after allegedly forgiving a PPP loan that was not eligible for forgiveness.
Assistant District Attorney Brett A. Shomat from the Civil Department of the Ministry of Justice:
“The Department is committed to ensuring that PPP lenders are held accountable for failure to comply with applicable program requirements, including approving forgiveness for PPP loans that were not eligible under the program rules.”
Regions Bank has agreed to pay $4,919,631 to resolve the allegations. Settlement agreement He says The bank’s decision does not mean its acceptance of responsibility.
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