Accused hate groups receive pandemic aid, by April Glaser

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Accused hate groups receive pandemic aid: 14 groups identified as hate groups benefited from the PPP program.
by April Glaser and Olivia Solon
Dec. 9, 2020, 8:45 AM MST

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Fourteen organizations designated as hate groups by the Southern Poverty Law Center or the Anti-Defamation League have received funding from the Paycheck Protection Program totaling $4.3 million, according to data released last week by the Small Business Administration, revealing who benefited from the pandemic federal relief funds.

Those organizations include the New Century Foundation, known for publishing the white supremacist website and now-discontinued magazine American Renaissance. That group is run by prominent white supremacist Jared Taylor, who for decades has argued that immigration policy should aim to “keep the country white.” The New Century Foundation received $51,600 in relief funds.

The analysis by NBC News, one of 11 newsrooms that sued for the release of data, was based on hate groups designated by the Southern Poverty Law Center or the Anti-Defamation League, that received PPP money and primarily focus on advocating against immigrants and opposing the advancement of homosexual and transgender rights. NBC News crosschecked the PPP data against 73 different designated hate groups whose work and advocacy focuses on attacking, maligning and delegitimizing entire classes of people based on their ethnicity, religion, gender, sexual orientation or if they have a disability.

The same list of hate groups was used in an assessment earlier this year for research conducted by the Institute for Strategic Dialogue, an anti-extremism think tank, and the Global Disinformation Index, a nonprofit research group, that analyzed how hate groups fundraise and collect payments online, which was exclusively reported by NBC News. All the groups assessed were also active as of 2020 and are actively promoting hateful ideologies, whether through literature, online content or grassroots organizing. In total, the 14 accused hate groups that received relief funds analyzed by NBC News were awarded a total of $4.3 million in PPP loans. Overall more than 5.2 million PPP loans worth more than $525 billion were approved, according to the SBA.

The groups that received funds also include American Family Association, a group that opposes what its leaders describe as the "homosexual agenda." It received $1,390,800 in PPP funds. The Federation for American Immigration Reform, known as FAIR, an anti-immigration group founded by leaders that hold ties to white supremacists, also was awarded $683,680 from the relief program.

Among the anti-LGBT groups that received relief funds is Church Militant, an organization that runs a media operation that advocates for so-called gay conversion therapies and links homosexuality to pedophilia, reaching large followings across Facebook, YouTube and on its own website. The group received a $301,100 PPP loan, according to SBA data.

The findings of the NBC News analysis troubled some experts who track the work of these specific hate groups.

“When it comes to the speed at which the PPP money had to be approved –– because people's livelihoods were on the line –– it was expected that some would exploit the system,” said Joan Donovan, the research director of the Shorenstein Center on Media, Politics and Public Policy at Harvard University, who studies how hate groups operate online. “Considering some of these were known hate groups, there should be a review at the government level to ensure that these monies were spent in the right ways and not to further any hateful activities these groups may be engaging in.”

The Small Business Administration said in a statement that it’s not commenting on any individual borrowers or loans. It reiterated that just because a loan was issued by the agency doesn’t mean that the recipient was eligible to receive it or that the loan will ultimately be forgiven.

“SBA takes seriously its stewardship of taxpayer dollars and has designed a robust loan review process to ensure that only eligible borrowers received loans that fully complied with program requirements,” an SBA spokesperson said.

To be fair, many advocacy organizations and nonprofits received PPP loans. About 3.5 percent of total PPP funds and 7 percent of the total dollar amount went to nonprofits, according to data analyzed by NBC News.

Recipient responses

NBC asked all 14 groups how they used their PPP money and if there were particular projects or revenue generating activities that halted during the pandemic that were supplemented with the relief funds. Six of the 14 groups responded.

“FAIR is in full compliance with the rules and the law, and we operate within the full intent and spirit of the PPP program,” said Ira Mehlman, the media director at the Federation for American Immigration Reform.

Church Militant disputed the SPLC’s designation of the organization as a hate group and said it has no response.

The Center for Family and Human Rights also disputed its hate group status. The American College of Pediatricians, which was also identified in this list, called the SPLC’s hate group designation a “mischaracterization.”

The Liberty Counsel, which received $428,100 in PPP monies and is designated as a hate group by the SPLC for its anti-LGBTQ advocacy, said that it used the funds for employee salaries, which allowed the organization to maintain its entire workforce without laying off any of its 35 employees. Mat Staver, the chairman and founder of the Liberty Counsel, added that his organization advocated in Washington, D.C., to make PPP relief funds available to nonprofits, regardless of their views.

The American Family Association and the New Century Foundation did not respond to requests for comment.

But the reporting showing that these groups received financial support alarmed the experts who track them.

“Extremist movements thrive in climates of political uncertainty,” said Cassie Miller, a senior research analyst at the SPLC. “In the midst of the coronavirus pandemic, far-right actors have exploited people’s fears and grievances to promote their ideologies. But now the government is doing even more to help hate groups by handing them millions of dollars in forgivable loans.”

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Release of PPP loan recipients' data reveals troubling patterns: Tenants paying rent at Trump Organization and Kushner Companies properties are beneficiaries of PPP loans.
by Ben Popken and Andrew W. Lehren
Dec. 1, 2020, 10:38 PM MST

Sweeping data released by the Small Business Administration on who benefited from pandemic relief programs raises questions about the equitability and distribution of loans intended for small businesses, an initial analysis by NBC News shows.

The analysis found that tenants paying rent at properties owned by the Trump Organization as well as the Kushner Companies, owned by the family of Jared Kushner, President Donald Trump's son-in-law and senior adviser, benefited financially from the program. These tenants received loans, which they then were required to put toward rent for the loans to be forgiven. The data did not show that the Trump Organization received PPP loans for its properties.

After months of litigation, the SBA released the dataset Tuesday night on every small business that received a Paycheck Protection Program (PPP) or Economic Injury Disaster (EIDL) loan.

The data reveals the most complete accounting to date of the more than $700 billion in forgivable loans Congress and the Trump administration introduced in the spring for allowable expenses, including payroll, rent, utilities and mortgage interest payments.

The analysis by NBC News, one of 11 newsrooms that sued for the release of data, also shows:

• Over 25 PPP loans worth more than $3.65 million were given to businesses with addresses at Trump and Kushner real estate properties, paying rent to those owners. Fifteen of the businesses self-reported that they only kept one job, zero jobs or did not report a number at all.
• The loans to businesses located at Trump and Kushner properties included a $2,164,543 loan to the Triomphe Restaurant Corp., at the Trump International Hotel & Tower in New York City. The company reported the money didn’t go to keeping any jobs. It later closed.
• A company called LB City Inc, which is located at Kushner’s Bungalow Hotel in Long Branch, New Jersey, received a loan for $505,552.50 that it used to keep 155 jobs.
• Two tenants at 725 5th Avenue, Trump Tower, received more than $100,000 and kept only three jobs.
• Four tenants at the Kushner-owned 666 5th Avenue combined received more than $204,000, and retained only six jobs.

Christopher W Smith, General Counsel with Kushner Companies, denied that the company had benefited improperly in any way from the program.

“The notion that Kushner Companies somehow improperly benefited from CARES Act Paycheck Protection Program (PPP) loans is completely untrue and amounts to nothing more than politically motivated nonsense. Exactly two Kushner Companies’ hotel operations affiliates received PPP loans. Every provision of the PPP program has been comprehensively abided with respect to each of the two loans – and every penny of the funds received from the program was utilized to fund employee payroll and benefits costs to maintain jobs imperiled by the COVID pandemic and associated lockdown measures.”

Kimberly Benza, a spokeswoman with the Trump Organization, wrote in an email, “The Trump Organization was specifically excluded from receiving PPP money, per Senate legislation. In other words, no Trump entity received pandemic-related loans from the government.”

Missing names

There were also some troubling signs of mismanagement revealed in the data. Over 100 loans were made to companies where no business name was listed, were listed as “no name available” or showed potential data entry errors, such as names that appeared to be dates or phone numbers. More than 300 companies appear to have each gotten more than $10 million in loans through their subsidiaries. Businesses were not supposed to receive more than $10 million per entity, except for those in the food, hospitality or hotels industries.

The findings immediately raised concerns with government accountability groups.

“Many months and broken promises later, the court-ordered release of this crucial data while the Trump administration is one foot out the door is a shameful dereliction of duty and flagrant mismanagement of a program that millions of workers and small businesses needed to get through this pandemic,” Kyle Herrig, president of Accountable.US, an accountability watchdog, said in a statement.

Original intent

The PPP programs’ original stated intent by officials was to help with payroll for small businesses struggling under the effects of coronavirus lockdown measures. The loans aimed to provide a bridge through the summer for what was hoped to be an improved economic and health climate in the fall.

The law creating the virus bailout program barred businesses controlled by government officials and their family members, including in-laws, from receiving loans. The indirect benefits the Trump and Kushner businesses received were not prohibited by law.

But almost from the start, the programs, particularly PPP, drew criticism for how they were administered and messaged, and whether it was equitable.

Large national banks initially gave loans only to customers with whom they had pre-existing lending relationships. Businesses owned by people of color without strong banking relationships found themselves with limited access and forced them to find other routes for funding. There was also the persistent question of what defined a “small business,” after lobbying by the hotel and restaurant industry ballooned the maximum number of employees allowable to 500, even though over 98 percent of the small businesses in America have fewer than 100 employees.

The administration tried to address the complaints, such as setting aside a day just for smaller community banks to apply for loans. But even that overwhelmed SBA computer systems. These controversies all increased the pressure for transparency.

But in contrast to previous government bailout programs, the agency previously released less detailed versions that it said for privacy reasons omitted the business names and addresses of borrowers who borrowed less than $150,000. And instead of specific loan amounts, loans were listed in ranges.

Mixed responses

The SBA defended its handling of the program when it released its data on Tuesday evening.

“SBA’s historically successful Covid relief loan programs have helped millions of small businesses and tens of millions of American workers when they needed it most,” an SBA spokesman said in a statement accompanying the release.

Jim Billimoria, an SBA spokesman, also noted that the missing information was the fault of the lenders. He wrote in an email, “what appears in the data is what was submitted by lenders into the SBA system.”

But as government accountability groups sifted through the data late into the night and uploaded them to publicly searchable databases like SearchPPP.com, they expressed regret about what has happened to so many small businesses partly from the loan program’s “mismanagement” and “malpractice,” said Herrig.

“Only now — after its hand has been forced, hundreds of thousands of small businesses have gone under, and millions of taxpayer dollars were wasted — has this administration pulled back the curtains to reveal the malpractice going on behind the scenes,” Herrig said. “Americans deserved an open, transparent small business aid program when this pandemic started, and any new small business relief program must take a lesson from the abject failures of this one.”

CLARIFICATION (Dec. 2, 2020, 8:45 p.m. ET): An earlier version of this article noted that tenants of the Trump Organization and the Kushner Companies received PPP loans. The Trump and Kushner companies did not themselves receive the loans, and the article has been changed to make that clear. In addition, the earlier version did not include responses from the two companies, which have been added.