Each bank “concealed from the public that it was reshuffling the PPP applications received and prioritizing the applications that would make the bank the most money,” said each of the four lawsuits.
The lawsuit has been filed by a number of small California businesses, including a frozen yogurt store, law firms, a car repair company, and a cyber security company.
Each bank “prioritized corporate greed at the expense of their small business customers,” the lawsuits seeking class action lawsuits.
The Bank of America and the US Bank denied the allegations. JPMorgan Chase and Wells Fargo declined to comment on the lawsuits.
The demand for PPP loans for which only 1
The U.S. Senate approved $ 480 billion of coronavirus aid, including additional $ 310 billion in PPP funding, on Tuesday. The loans can only be forgiven if the small companies maintain the current level of employees and remuneration.
Banks should process PPP requests based on availability.
However, the lawsuit cited data from the US Small Business Administration that the banks prioritized and preloaded applications with larger amounts of credit. Larger loans mean higher fees for banks.
However, the lawsuits did not result in emails or internal documents suggesting that this was the intention of the banks.
JPMorgan: 40,000 more verified applications are ready for use
In a statement, Bank of America said: “Although we disagree with these claims, we are fully focused on processing applications so that they can be submitted,” once the applications are accepted again.
JPMorgan said that 80% of Chase Business Banking’s PPP loans were for businesses with sales of less than $ 5 million. More than 60% of these PPP loans went to customers with fewer than 25 employees. JPMorgan announced that more than 40,000 processed and fully reviewed applications could be submitted to the SBA, which would provide additional $ 7.3 billion to small business customers.