DFR Encourages Businesses to Work with Trusted Lenders to Avoid Scams as the Paycheck Protection Program Reopens Monday

27 April 2020

Montpelier, VT – Department of Financial Regulation Commissioner Michael Pieciak today warned Vermont’s small business community to be cautious of scammers targeting the Paycheck Protection Program established under the Coronavirus Aid, Relief and Economic Security (CARES) Act. The Paycheck Protection Program (PPP) has been popular in Vermont and operates through lenders approved by the U.S. Small Business Administration (SBA). To date, approximately 6,800 Vermont businesses have secured loans totaling over $1 billion.

Reports of fraud from other New England states run the gamut, but generally involve unsolicited calls or emails to small businesses. In Maine, scammers are allegedly demanding upfront fees with the promise of guidance and advice about securing a PPP loan that is never delivered. Scammers are also falsely stating they can get their victim’s application to the front of the line for a fee even though the program operates on a first-come, first-served basis. In Rhode Island, the Federal Trade Commission filed legal action to prevent a company from falsely identifying its affiliation with the SBA.

“Fraudsters often look to capitalize on times of crisis and uncertainly and unfortunately the Covid-19 pandemic is no different,” said Commissioner Pieciak. “Small businesses should protect themselves by working directly with a trusted SBA approved lender and avoid any unsolicited opportunities, particularly over the internet.”      

The program stopped accepting applications on April 17, 2020 when it ran out of funds, however, an additional $310 billion appropriation was signed into law on April 25, 2020, and starting today applications will be accepted for the additional monies.

“Vermont Banks and Credit Unions have worked tirelessly to ensure our small businesses had access to the Paycheck Protection Program before the funds ran out, in fact, Vermont ranked third in the country in total loan commitment on a per capita basis. Now we encourage any businesses interested in participating in the second round of funding to reach out to their trusted lender today to begin the application process,” said Joseph Bergeron, President, Association of Vermont Credit Unions & Christopher D’Elia, President, Vermont Bankers Association.      

Vermont businesses can visit the SBA’s website to confirm that their lender is approved and participating: https://www.sba.gov/paycheckprotection/find.

Vermont businesses are encouraged to reach out to the Department’s Banking Division by phone 888-568-4547 or by email dfr.bnkconsumer@vermont.gov to report a suspected scam or with general questions regarding the Paycheck Protection Program.

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