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Politics & Policy

Senators Demand Answers on Planned Parenthood’s COVID-Relief Loan Fraud

Senator Tom Cotton arrives for a hearing on Capitol Hill in Washington, D.C., May 16, 2018. (Joshua Roberts/Reuters)

On Thursday, Arkansas senator Tom Cotton led more than two dozen Republican senators in sending a letter to the Small Business Administration (SBA), urging its officials to hold Planned Parenthood accountable for having improperly obtained COVID-19 relief loans last spring.

In May 2020, the SBA admitted that dozens of Planned Parenthood affiliates had improperly applied for and received a total of about $80 million in forgivable loans from the Paycheck Protection Program (PPP), which Congress created in the CARES Act for small-business relief.

After intense debate over the program and especially over whether it might extend to abortion providers, Congress had chosen explicitly to exclude nonprofit organizations set up as affiliates — large nonprofits such as Planned Parenthood — from applying for PPP funding.

Nevertheless, a number of Planned Parenthood affiliates evidently applied for and received that small-business aid anyway, over and against the explicit provisions in the CARES Act. Shortly after that news broke last May, Cotton led his colleagues in writing to the Department of Justice, asking that the attorney general investigate those affiliates for their fraudulent self-certification of eligibility for the PPP.

More than half a year later, no new information has been released, and as far as we know, those Planned Parenthood affiliates haven’t returned the loans they obtained.

This new letter from Cotton and 30 Senate Republicans urges the SBA to “take precautions so that affiliates of Planned Parenthood, the largest and most notorious abortion provider, do not receive loans under the Paycheck Protection Program (PPP)” again this year.

Under the new coronavirus-relief package that Congress passed in December, applicants to the PPP for a second round of small-business loans are not eligible if they employ more than 300 individuals. Planned Parenthood, meanwhile, has about about 16,000 employees, which exceeded both last year’s PPP cap of 500 and this year’s cap of 300.

“Planned Parenthood affiliates thus are ineligible to receive PPP loans, as part of an affiliated group that employs far more people than the number allowed for an initial or second-draw PPP loan,” the senators write.

The letter reiterates the senators’ call for the SBA to pursue further action against Planned Parenthood for the loan fraud it appears to have committed last year. “Members of this body previously have urged you to investigate these false certifications of eligibility, recover the more than $80 million in funds, and seek appropriate penalties against Planned Parenthood affiliates that broke the law,” it continues. The senators encourage the SBA to inform participating lenders that Planned Parenthood is ineligible for PPP loans and refer any Planned Parenthood affiliate that applies for a loan to the Justice Department for prosecution.

Finally, the senators point out that Planned Parenthood executives were well aware that federal law prohibited the group’s affiliates from claiming small-business loans under the PPP.

The letter is correct. Last May, after news of its loan fraud became public, Planned Parenthood asserted on Twitter that its affiliates had met the eligibility rules established by Congress for the small-business loans. In reality, Planned Parenthood itself already had admitted that it wasn’t eligible for the loans. After Congress passed the CARES Act, Planned Parenthood Action Fund issued a statement condemning the legislation for excluding the organization from its funding: “The bill gives the Small Business Administration broad discretion to exclude Planned Parenthood affiliates and other non-profits serving people with low incomes and deny them benefits under the new small business loan program.”

The GOP senators are right, then, to refer to Planned Parenthood’s loan applications as “naked attempts to defraud the United States government.” This time around, the SBA should be hyper-aware of the abortion group’s willingness to commit fraud and refuse to allow its affiliates to claim funding intended for small businesses in need.

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