The U.S. Chamber Institute for Legal Reform and the U.S. Chamber of Commerce submitted comments to the Small Business Administration (SBA) regarding the Interim Final Rule (IFR) for the Paycheck Protection Program (PPP), emphasizing the importance of hold-harmless provisions that protect lenders from liability under the False Claims Act when processing and underwriting PPP loans and forgiveness applications. They argue that these protections are essential to expedite relief to small businesses impacted by the COVID-19 pandemic, as Congress intended, by removing the threat of litigation that could otherwise slow down the process.
The letter supports the SBA’s position that lenders should be able to rely on borrower certifications and information when determining eligibility and loan forgiveness, and should not be held responsible for borrower non-compliance. To further strengthen these protections, the Chamber recommends that the SBA enter into a Memorandum of Understanding (MOU) with the Department of Justice (DOJ), formalizing the conditions under which the DOJ may pursue False Claims Act cases related to PPP loans and encouraging the DOJ to dismiss qui tam actions that conflict with the IFR’s hold-harmless provisions.
The Chamber concludes by commending the SBA’s efforts to fulfill Congress’s intent and urges continued collaboration with the DOJ to limit speculative litigation. By doing so, the SBA and DOJ can ensure that financial institutions are able to efficiently deliver critical relief to small businesses without undue fear of liability, thereby supporting the economic recovery during the COVID-19 crisis.
