SBA revises PPP restrictions for applicants with felonies

The SBA issued a new Paycheck Protection Program interim final rule revising its recently updated eligibility guidelines for borrowers facing criminal charges. Newly revised borrower and lender application forms dated June 24 incorporate the changes.

Among its provisions, the agency's June 12 interim final rule determined that applicants are ineligible if an owner with 20 percent or more in equity is subject to pending criminal charges. Wednesday's revised rule limits the restriction to pending criminal charges for felony offenses.

The new rule also limits PPP ineligibility restrictions for individuals on probation or parole. Under the new policy, individuals whose probation or parole commenced within five years for financial felonies and one year for other felonies will be ineligible.

ICBA continues calling on community bankers and small-business owners to urge the Treasury Department and SBA to enact additional PPP simplifications, including a loan-forgiveness calculator and presumption of compliance for certain loans.

Questions on submitting 1502 reports can be directed to SBA's Fiscal and Transfer Agent, Colson Services Corp., at info@colsonservices.com or 877-245-6159. Additional guidance and resources are available on Treasury’s PPP webpage and ICBA's COVID-19 resource center.