The country’s largest banks are being sued for failing to pay the required $ 3.8 billion in fees related to the Small Business Administration’s Paycheck Protection Program.
The PPP program provides approximately $ 659 billion in forgivable loans, and banks receive a processing fee of 1-5 percent, depending on the size of the loan. The lawsuit alleges that the program also includes 0.25-1 percent compensation for agents such as lawyers, accountants, brokers, and consultants, and the lenders refuse to pay.
American Video Duplicating, Tush Law, and Cal State Financial are suing Citibank, US Bank, JPMorgan Chase, Wells Fargo, Bank of America, MUFG Bank, Union Bank of California, PayPal, and others.
According to the lawsuit filed in California federal court on Monday, published below, each of the plaintiffs spent between 50 and 100 hours familiarizing themselves with the law and an additional two to 10 hours on each filing.
The proposed class is defined as: “Any agent within the meaning of the SBA Regulations that allowed small businesses to take out a loan under the PPP between February 15 and June 30, 2020, ie meeting the eligibility criteria and otherwise were not eligible. who applied for and processed a PPP loan from various banking institutions in due time and were approved for funding. ”
Plaintiffs are demanding a statement that approximately 19.14 percent of the management fees paid to banks (more than $ 3.8 billion by their calculations) should be paid into a fund within 60 days for them to be paid to agents who have processed the corresponding loans can be distributed. They are represented by lawyers from Geragos & Geragos, Graylaw Group and Dhillon Law Group.