13 September 2020

The Corporate Culprits Receiving Covid BailoutsL GOOD JOBS FIRST Provides A State-By-State Breakdown

The data for the study was collected from two Good Jobs First databases:
(1)
COVID Stimulus Watch, which covers 20 CARES Act programs, and 

(2) Violation Tracker, which combines enforcement data from more than 50 federal and 200 state and local agencies. 
Companies appearing in both databases were identified and verified through an extensive matching and record-linkage process. 

The report also includes a state-by-state breakdown of Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) amount and penalties.
The Good Jobs First findings are consistent with those contained in a recent analysis of the PPP published by the Select Subcommittee on the Coronavirus Crisis. 
Additionally, our data show the conclusions apply to healthcare providers and other categories of CARES Act recipients.
Good Jobs First, based in Washington, DC, is a non-profit, non-partisan resource center promoting accountability in economic development and overall corporate accountability.
 
 
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Greg LeRoy, Good Jobs First 
_______________________________________________________________________________
 
For Immediate Release ~ September 8, 2020
Contact: Arlene Martínez | arlene@goodjobsfirst.org | 202-302-4301
 
Billions in Pandemic Aid Flow to 43,000 Penalized Firms
CARES Act Monies Go to Companies that Have Defrauded Uncle Sam, Stolen Wages, Broken Health & Safety Rules
 
Washington, D.C. – More than 43,000 businesses and non-profit organizations that received CARES Act funds have a history of misconduct, collectively paying $13 billion to settle civil and criminal penalties over the last decade.
 
Together, the same companies received $57 billion in grants and $91 billion in loans through the federal economic stimulus bill passed by Congress to mitigate the economic fallout from the COVID-19 pandemic.
 
Among the violations are workplace safety issues, leading in one case to the death of a worker, flouting of environmental standards, wage theft and defrauding the federal government. They raise the question whether greater scrutiny should be given to how recipients are using taxpayer dollars.
 
These are among the findings in “The Corporate Culprits Receiving COVID Bailouts,” a report published today by Good Jobs First. It is available at www.goodjobsfirst.org/corporateculprits.
 
“The revelation that tens of thousands of CARES Act recipients have records of misconduct—including some cases of a criminal nature—raises the question of whether the eligibility criteria for the grant and loan programs were strict enough,” said Good Jobs First Research Director Philip Mattera, who co-authored the report with Mellissa Chang. “Policymakers also need to consider whether these recipients should be subjected to additional scrutiny to ensure their misbehavior does not continue while on this new kind of federal dole.”
 
Key findings include:
 
  • 6,087 healthcare providers received $85 billion in grants and loans despite having paid $9 billion in penalties, most related to accusations of defrauding Medicare and Medicaid programs.
  •  38,362 small businesses received $37 billion in loans though they have paid penalties of $3 billion, mostly for wage theft and jeopardizing worker health and safety.
  • 147 colleges and universities received $503 million in grants and paid $900 million in penalties, mostly for-profit institutions that have used deceptive marketing practices to attract students and then saddling them with sky-high debt.
  •  32 aviation-sector companies received $25 billion in grants and loans despite having paid $600 million in penalties related to worker safety, to settle discrimination cases and, in one case, for allegedly bribing foreign officials.

Another way the federal government worked to mitigate the coronavirus-induced recession involved buying corporate bonds to shore up commercial credit markets. The Federal Reserve has bought $3.6 billion worth of bonds from 400 companies; however, more than three-quarters had a history of misconduct.
 
Collectively, the group – largely comprised of Fortune 500 and Global 500 corporations – has paid $108 billion in penalties over the last decade.
 
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