Absent disclosures, PPP loan recipient motives raise questions (FundFire)

Well over a hundred industry firms, including some well know known names, have received loans as part of the SBA’s Paycheck Protection Program (PPP). According to FrontLine’s Founder and President, Amy Lynch, these firms are required to disclose the loans on their ADV, if considered material to their client advisory relationship. She states that an example would be a firm needing the loan for payroll expenses to continue work for their clients or to manage clients’ funds. However, most firms that took PPP loans have not disclosed them, which may mean they were not used fully, if at all, explains Ms. Lynch. It could also raise questions with the SEC, who may ask to see evidence of how the loan was in fact used and whether it should have been disclosed on the ADV. See FundFire (subscription required), “Data Sheds Light on Biggest Industry Recipients of Economic Relief Funds”