Planned Parenthood coronavirus loans could face DOJ investigation

CNA Staff, May 21, 2020 / 11:30 am

More than two dozen senators asked the attorney general on Thursday to investigate Planned Parenthood affiliates that have received emergency federal loans.

A letter from 27 senators, led by Sen. Tom Cotton (R-Ark.), asked Attorney General William Barr to investigate 37 Planned Parenthood affiliates that reportedly applied for and received $80 million in emergency small business loans in recent weeks, during the pandemic.

The senators noted that "it seems clear that Planned Parenthood knew that it was ineligible for the small business loans under the CARES Act long before its affiliates fraudulently self-certified that they were eligible," the senators stated.

"As you know, fraudulent loan applications can trigger both civil and criminal penalties," their letter stated.

The loans under the Paycheck Protection Program (PPP) were initially set up in March under the CARES Act, as an emergency measure to help eligible small businesses and non-profits keep employees on payroll during the pandemic. The loans could become grants if certain conditions were met.

To be eligible for PPP loans, businesses and non-profits could not have more than 500 employees. If they were affiliated with a larger national organization under existing Small Business Administration (SBA) rules, then they would be counted together with the larger organization and all its affiliates.

Faith-based groups were exempt from the affiliation requirement, which meant that Catholic parishes and schools-while part of a larger diocese-were not all lumped together and counted as a single entity that would be ineligible for PPP loans. Thousands of parishes have applied for and received PPP loans.

Other national organizations such as Planned Parenthood, which says it has 49 affiliates around the country, were meant to be subject to the affiliation rules and thus were considered ineligible for the emergency assistance.

Funding of Planned Parenthood was part of the negotiations for the CARES Act in March, and the bill passed reportedly with Planned Parenthood locked out of the PPP loan program. On March 27, when the bill passed the House, Planned Parenthood Action decried the "attacks on reproductive care"

"The latest coronavirus relief package expands the Hyde Amendment to a new pot of funds and attempts to target Planned Parenthood health centers - a cruel disservice to the millions of people across the country who are already struggling to access care," Planned Parenthood's acting president Alexis McGill-Johnson stated.

Yet on Tuesday, Fox News reported that 37 Planned Parenthood affiliates applied for and received $80 million in PPP loans. The SBA was seeking for the affiliates to return the loans, Fox News reported.

The letter from the 27 senators cited Planned Parenthood's "clear ineligibility under the statutory text" of the CARES Act which set up the first round of PPP loans.

"It was also well-publicized at the time that the CARES Act did not allow Planned Parenthood affiliates to utilize these loans," the letter stated.

Some publicly-traded corporations received PPP loans. CNBC reported in April that more than 245 public companies applied for nearly $1 billion in PPP loans.