On May 18, 2020, the US Small Business Administration (SBA) released its twelfth interim final rule (IFR #12) on treatment of entities with foreign affiliates and purporting to “clarify” its own prior “guidance” noting that:

“Some market participants have indicated that there may be uncertainty regarding whether PPP applicants must include employees of foreign affiliates in their employee counts, because SBA has previously issued guidance stating that an entity is eligible for a PPP loan if it has 500 or fewer employees whose principal place of residence is in the United States. See 85 FR 20811, 20812 (April 15, 2020).”


Continue Reading Now We Know it Was “Mud”: The SBA “Walks Back” Its Prior Rules and FAQs Regarding Treatment of Foreign Affiliates

In statements made yesterday on “Squawk Box” on CNBC, Secretary Mnuchin said:

“I’m going to be putting out an announcement later this morning that for any loan over $2 million, the Small Business Administration will be doing a full review of that loan before there is loan forgiveness,” and regarding the Los Angeles Lakers, the

Today, the US Small Business Administration (SBA) provided further guidance for PPP loan applicants in FAQ #37, which states:

  1. Question: Do businesses owned by private companies with adequate sources of liquidity to support the business’s ongoing operations qualify for a PPP loan?

Answer: See response to FAQ #31[1].

Beyond potentially excluding private companies (in addition to public companies under the SBA’s prior FAQ #31) with “adequate sources of liquidity,” the SBA offers no meaningful guidance regarding such “adequacy” or “sources” or even regarding what might constitute such “liquidity.”


Continue Reading Still Clear as Mud (Unfortunately): SBA’s Latest Official FAQ Fails to Provide Meaningful Guidance for Potential PPP Borrowers

In FAQ #31 posted on April 23, 2020, the US Small Business Administration offered the following clarification (italics added):

31. Question: Do businesses owned by large companies with adequate sources of liquidity to support the business’s ongoing operations qualify for a PPP loan?

Answer: In addition to reviewing applicable affiliation rules to determine eligibility, all

On April 15, 2020, Senators Corey Booker (D-NJ) and Sherrod Brown (D-OH) sent letters to numerous leading banks urging them not to charge customers overdraft and non-sufficient fund (NSF) fees during the COVID-19 pandemic.  According to the letters, “banks should be ensuring that consumers will not be faced with any overdraft charges that compounds their already fragile financial state, and provide them some relief as they manage ongoing expenses, including rent and mortgage payments, utility bills, and other essentials.”  Senators Booker and Brown did acknowledge in the letters, however, that “[s]everal banks have announced that they will temporarily waive or refund overdraft fees for their customers.”

Continue Reading Senators Booker and Brown Urge Banks Not To Charge Overdraft And NSF Fees During Pandemic

Today, a federal judge in Maryland denied an emergency motion seeking to block Bank of America from applying eligibility restrictions to its lending under the $349 billion Paycheck Protection Program (“PPP”). The motion for a temporary restraining order and preliminary injunction was filed by four small businesses, which had alleged that Bank of America only accepted applications for PPP loans from small business checking customers that were already borrowers at the bank or that were not also borrowers at any other bank. The businesses alleged that these limitations violated the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), which established the PPP, and the Small Business Act (“SBA”).

Continue Reading Maryland Federal Court Denies Attempt to Block Bank of America’s Eligibility Restrictions for Paycheck Protection Program Loans

Any day now, maybe even today, Ginnie Mae will announce the details on its Pass-Through Assistance Program (“PTAP”), through which Ginnie Mae will provide a liquidity facility for issuers that need help meeting their obligation as issuers to pass-through payments of regularly scheduled payments of principal and interest, regardless of whether the loans are subject

On March 31, 2020, in an effort to continue to respond to the challenges brought about by the Covid-19 crisis, the Commodity Futures Trading Commission (CFTC) staff issued temporary relief that will permit certain US trading firms to serve their US customers from foreign affiliates. Many US futures commission merchants (FCM) are part of international financial service groups with global operations in various financial centers outside the United States, and the new relief will have the practical effect of allowing those non-US personnel to enter orders of US customers where certain conditions are satisfied.

The issuance of the relief marks a significant and helpful step. Recognizing the operational difficulties confronting numerous FCMs during this period, CFTC staff has taken an aggressive and well-advised step to help promote the efficiency of order execution.


Continue Reading CFTC COVID-19 Relief Allows Certain Foreign Brokers to Enter US Customer Orders

The practical applications for utility tariff bonds (UTBs) continues to expand.[1] One additional use for UTBs may well be the recovery of COVID-19 pandemic costs (COVID-19 Costs) incurred by utilities. UTBs are an efficient way to finance costs over which a utility has little practical control and where the recovery of such costs would likely otherwise cause rate “shock” for customers.

Continue Reading Recovery of COVID-19 Costs by Utility Tariff Bonds?