The Canadian Imperial Bank of Commerce’s (CIBC) U.S. division is assessing borrowers’ environmental policies and whether such institutions sell to the U.S. military when applying for Paycheck Protection Program (PPP) loans offered by the federal government, according to Republican Sen. Marco Rubio’s office.
Neither examinations are stipulations for federal assistance provided in the loans under the recent Coronavirus Aid, Relief, and Economic Security (CARES) Act, or are they guidelines from the U.S. Treasury or Small Business Administration (SBA) to receive taxpayer-funded relief amid the economic fallout over the coronavirus crisis.
In late March, Congress passed the CARES Act allocating $377 billion for immediate assistance to small businesses suffering devastating losses over the pandemic. Part of that assistance includes the PPP which was created to keep workers on payroll throughout public health emergency keeping businesses closed.
Rubio’s office tells The Federalist however, that CIBC USA is examining small business applicants seeking federal funds on criteria not established by the U.S. government as conditional for support including environmental standards and affiliation with the American military.
On Thursday, Rubio sent the bank’s CEO Michael Capatides a letter demanding open answers on whether the bank was imposing additional strings attached to taxpayer-funded loans with a response deadline set for Monday evening.
In addition to requesting the bank’s policies and procedures put in place for loans provided under the PPP, Rubio is asking the institution’s CEO the following questions:
At any point during the application process, does CIBC USA evaluate or make an assessment of a prospective PPP borrower’s environmental policies or values?
At any point during the application process, does CIBC USA evaluate, assess, or determine if a prospective PPP borrower engages in business with the U.S. Department of Defense?
“The PPP program is a lifeline for small businesses suffering during this unprecedented crisis through no fault of their own,” Rubio wrote. “It is imperative that small businesses do not face any unnecessary hurdles or delays in participating in this critical program, which is funded by U.S. taxpayers, and for which you are paid by U.S. taxpayers to process these loans.”
Amy Yuhn, a spokesperson for CIBC told The Federalist that only one loan application was “mistakenly subjected to additional review not required under the terms of the PPP.”
“This loan was approved and funded and, in fact, all of the applications we have received from our clients under the program were approved,” Yuhn said.
As concerns over potential unauthorized stipulations heighten on Capitol Hill from the Canadian bank, the future of the PPP remains in limbo as the fund for small business assistance established in the CARES Act was officially exhausted on Thursday. Meanwhile, new figures from the Department of Labor released the same morning show an additional 5.2 million Americans filed for unemployment last week bringing the four-week total of the newly unemployed to 22 million.
Congressional Republicans have tried for more than a week to pass a clean funding bill to replenish the now-depleted program with $250 billion in fresh assistance but have been blocked by Democrats offering a counter-proposal of their own consisting of a progressive wish-list of long-advocated items.
As small businesses face permanent closure in the absence of assistance, pressure is growing within congressional Democrats’ own ranks to pass new funding for the program, including calls from Sens. Kyrsten Sinema of Arizona, Joe Manchin of West Virginia, and Tina Smith of Minnesota. Former President Barack Obama’s small business chief during his first term also joined the growing chorus in the Democratic Party to push for immediate funding to save the nation’s small businesses.
“Congress has to act as soon as possible,” Karen Mills said in an interview with Roll Call Thursday. “Number one, get the money replenished.”
Read Rubio’s full letter to the CIBC president here: