As part of the federal government’s efforts to help small businesses survive the economic effects of the COVID-19 pandemic, Congress and the Attorney General have sent a clear message: fraud in connection with the procurement and use of Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) loans and grants will be investigated and prosecuted aggressively. Indeed, such aggressive law enforcement seems to be one of the few things on which both sides of the political spectrum can agree.
In this article published by the NYU Compliance & Enforcement Blog, RK&O attorneys David Daniels, Lee Richards, Daniel Zinman and Rachel Mechanic offer a detailed summary of the legal risks to banks and borrowers that participate in loans and grants made available under the CARES Act. Banks and borrowers would do well to heed the clear messages from both branches of the federal government: to avoid criminal and regulatory exposure, transparency and accuracy should be at a special premium for those that participate in these loans and grants.
The CARES Act – Lenders Beware – NYU Compliance & Enforcement Blog