Bank of America

Is Bank Of America Trying To Wreck The PPP Loan Program Under President Biden?

This latest OaklandNewsNow.com post on the Bank of America PPP Loan Program was ignited by an email from San Diego lawyer JoEllen Plaskett, who’s story is recounted here. She opened the door for me to look at the larger picture of what Bank of America PPP Loan Program Second Draw customers are facing: delays, frustrations, and cancellations.

RELATED: Bank Of America Undermines PPP Loan Program By Making Up It’s Own SBA Forgiveness Rules

The Payroll Protection Program: A Program With Great Promise And A Young History of Bank Of America Implementation Problems

The Payroll Protection Program, or PPP Loan, has been hampered by a great many problems, and the latest appears to be with a major bank, Bank of America, which just happens to be my personal and my firm’s business bank, and the bank of a giant number of participants in the PPP Loan Program.

Many of the problems have been chronicled in past posts here on Oakland News Now, and dating back to April of 2020:

Bank of America Has Limiting Version Of CARES Act Paycheck Protection Program

Bank Of America Paycheck Protection Program Website Has Form Page Access Problem

Small Business, Marketing, Payment Protection Program – With Beth Schnitzer Of Spritz Marketing SF

Biden Administration Must Review Bank Of America PPP Loan Program For Racial Bias

Bank Of America PPP Loan Mess Leads To Wrongly Asking Americans To Give EIDL Money Back

Bank Of America Should Stop Twisting SBA PPP Rules To Collect Money To Offset Losses

Bank Of America Posts New SBA PPP Rules After I Complain – Now BofA Late With Loan Forgiveness

Salt Lake Tribune Takes Govt PPP Loan, Denies Oakland, Coal Industry Aide; Paul Huntsman’s Two Step?

Biden Administration SBA, Economic Officials

Now, after Zennie62Media, Inc. received a $23,750 PPP Loan last March 2020, the PPP Loan Second Draw program was recently offered – and with applying for it came a new set of horrors. First, while I established the Zennie62Media brand via a domain name in 2010, Zennie62Media, Inc., is a new startup. Second, for some weird reason (which I will get to), Bank of America was asking for proof that my business was in operation February 15th, 2020.

Well, one would think that Bank of America could simply give consideration to one of their own business banking account customers in Zennie62Media, right? Consider that Bank of America asks for business banking account applicants to provide proof that their business exists in the form of articles of incorporation, and an EIN number, which I had, including other proof, like business insurance.

The whole point of it all, I thought, was to prove the existence of a “corporate veil” separating the person making the application, which is me, from the firm itself, and officially seeing the firm as a separate person. Since Bank of America took my documents and created the account, I must assume that was the purpose, and because Bank of America offered no other official reason that would be dramatically different from my hypothesis.

Now, for the PPP Loan Second Draw program, Bank of America appears to be making up their own rules. First, they go back to the April 15, 2020 set of guidelines for the first PPP Loan Program, and apply them for the ask for the PPP Loan Second Draw program. Bank of America asks for the same proof of existence that was requested on the first PPP Loan, and for the same period of time:

What certifications need to be made? On the Paycheck Protection Program application, an authorized representative of the applicant must certify in good faith to all of the below:1i. The applicant was in operation on February 15, 2020 and had employees for whom it paid salaries and payroll taxes or paid independent contractors,…

This is beyond ridiculous, and Bank of America is essentially insulting its own business banking customers seeking a PPP Loan Second Draw to basically do it all over again, rather than just checking the documents submitted for the same time period. Moreover, when one does give them, as I did, then, Bank of America tries to get you to lower your loan request by saying you have to provide additional documentation for your request, and then, they say that’s not sufficient – basically telling you that the proof of economic decline you experience just doesn’t exist.

Unlike some other news organizations, I have no problem discussing this matter. My business model of resting revenue generation on client-based content and reputation management work (a business model I borrowed from BuzzFeed and altered) works, but this is a pandemic, folks – the revenue window suffers. And I’m not the only one who’s impacted (though I took precautions months ago in anticipation of a downturn) – many are.

Today, I received this email from JoEllen Plaskett, a lawyer based in San Diego, California:

just posted this on facebook as a follow up to your article and experience with BOA for the PPP.

“Bank of America is STILL refusing to use the new Biden-Harris calculations and asking me to use the old calculations based on line 31 (net) instead of Line 7 (gross). After a running total of 21+ hours of calls waiting to speak to someone/anyone at BOA that understands the PPP Rules, BOA told me to change my application and use the old calculation rules, and they’d change the amount LATER! Now 16 days later, BOA caused my small business to miss the priority window. BOA’s PPP Worksheet is still instructing PPP Applicants to use line 31 to calculate their loan amount. I believe this is intentional as BOA also changed my PPP 1 requested loan to 65% less than my initial request. When confronted, BOA agreed there was a mistake and assured me they’d fix it, but did absolutely nothing. Since my PPP1 was with BOA, I was forced to use them again. Given that after 16 days BOA still refuses to use the new “gross” calculations, I asked to cancel my PPP2 (so I could try applying with a different lender) and BOA stated it would take 10-14 days, which risks my ability to even submit the application with another lender prior to the March 31st cutoff date. Since I’ve refused to use the old rules, I’m receiving notices multiple times a day to go into my BOA PPP Application, alleging wrong owner compensation and loan amount, when both are 100% correct and confirmed correct by BOA Second tier supervisors. It’s been 16 days since the new rules came into affect, yet BOA PPP specialists still say BOA is NOT ready to process any PPP applications using gross income to calculate the loan amount. Please share this information so other small business won’t be damaged by BOA’s absolute incompetence!”

Please post or circulate this post and/or contact me privately …

Thanks,
JoEllen Plaskett, Esq.

What she wrote is exactly the experience I have gone through. Ms. Plaskett saw one of my posts, and reached out. Now, in reviewing Twitter under the search for “BofA PPP Loan”, today, Thursday, March 11th, 2021, this is what I found (in chronological order):

Bank of America responds to BPH1982

BPH1982 expresses more frustration with Bank of America, here

Bank of America Rep responds…

And here’s another complaint, and another…

Why Is Bank Of America Working Ahead Of The Biden Administration And Using The Old Trump Rules In A Dranconian Way?

The open question is why is Bank Of America working to frustrate its loyal business banking customers, and even telling some to either go to the SBA itself (as I was) or another PPP Loan Bank? And for good measure, Twitter is not the only place where PPP Loan complaints against Bank of America have been issued. Check this Reddit thread:

Bank of America BOA BOFA held my PPP loan hostage

Applied 1/25/21 and we cancelled application 2/17/21 BOA sent approved loan application to SBA 2/19/21 only to be a cancelled loan. 2/23/21 we agreed under BOA guidance (after Originally agreeing to 48 hour delay to apply again ) but loan wasn’t cancelled even though we originally agreed 2/17 to cancel to reapply after (48 hours so said the boa rep) but not so. After many days loan was still active and were even told to reapply elsewhere but get this 2/17/21 cancelled loan at BOA and 2/27/21 loan rejected at Biz2credit because BOFA loan still active even know we cancelled 2/17/121 and after 30+ hours talking to Bank of America stay away nobody at that company can actually fix problems the company creates even by accident. The reps are great but the company has no ability to fix problems the company creates.

The-RealHaha-11 days ago

I think the SBA set up the new fraud protections and it kicked back lots of the apps back with error codes. For those of us who applied early that was the problem because the lender were so overwhelmed that the applications with even simply error codes got pushed back or fell through the cracks.

For those who waited a few weeks to apply things moved much quicker. Hopefully lenders might catch a breath with less applications coming in and they can clear some error codes. But I’ve learned you really really have to bug the absolute shit out of them. Make them never want to hear from you again. Find out who the CEO is, email and call. Stay on it.

D543421d – 3 days ago

After 60 days of bank America declining me for the wrong documents. They were clearly wrong. I was able to submit my ppp through lendio. Submitted on the 27th and funded today.

BMF47 – 11 days ago

This is my second ppp draw. First was done with BOA as well. I was getting document errors and loan was stuck in review for 3.5 weeks that’s why I cancelled the loan. I was told it was just stuck, and If I cancelled I could reapply in 48 hours. Cancelled 2/17 but BOA pushed loan through to SBA 2/19 accidentally and then had to list it as cancelled 2/21, because the cancellation claim came into effect after BOA sent loan forward. However even today 2/28 the loan still hasn’t been withdrawn. BOA said it was withdrawn but it’s not and I applied Biz2credit and paperwork was approved and sent to SBA in 2 days but BOA loan is still there blocking any other loan. So as of today 2/28 a loan application which I cancelled 2/17 and had applied for on 1/25 is stuck at SBA and it’s cancelled but BOA doesn’t know how to withdraw it. It’s nightmare and running out of time. I filed complaint with BBB last night and sent emails to all SBA email links I could find but can’t get any answers

D543421d – 8 days ago

Bank of America is the worst. My associates with other banks already received PPP. BofA does not understand S corps and only need to provide bank statements. BOA keeps cancelling me. I was approved with an SBA through LENDIO in a week.

Ok_Ebb_6309 – 4 days ago

CANCEL anything you did with BOA before March 1st. Call them to escalate the cancellation. Then, apply with another lender. BOA doesn’t care.

There’s more on Reddit, and Facebook, and more places that can fill a book. But why is Bank of America causing so many of its customers problems? Why are they using the Trump rules when Joe Biden is President?

Well, while Bank of America has not yet responded to all of the complaints, and I’ve gotten the run-around, it seems that Bank of America CEO Brian Moynihan was on President Trump’s new advisory committee on reopening the economy. Later, he said to the media:

“We’re trying to give them the advice, the more you can keep people stabilized in their ability to meet their obligations and keep their family fed and housed and things like that, that is what you should be focused on until you can reopen the economy.”

But then, there’s this from April of last year:

Four businesses filed a lawsuit against Charlotte’s Bank of America Corp. (NYSE: BAC) on Sunday, criticizing the way it handled loan applications for the Small Business Administration’s Paycheck Protection Program. The suit was filed in federal court in Los Angeles.

The lawsuit alleges BofA prioritized applications for higher loan amounts because those would generate more origination fees for the bank. The SBA previously said PPP applications would be accepted and processed on a first-come, first-served basis.

“BofA has, once again, prioritized corporate greed at the expense of its small business customers,” the suit reads. “Had BofA been honest, small businesses could have (and would have) submitted their PPP applications to other financial institutions. … As a result of BofA’s dishonest and deplorable behavior, however, thousands of small businesses that were entitled to loans under the PPP were left with nothing.”

BofA is one of several banks facing similar allegations. Others are Wells Fargo & Co. (NYSE: WFC), JPMorgan Chase & Co. (NYSE: JPM) and U.S. Bancorp (NYSE: USB). Those lawsuits were also filed on Sunday.

Bill Halldin, a BofA spokesperson, said the bank disagrees with the allegations. BofA is focused on processing applications in anticipation of more PPP money. It has about 8,000 people working on them, he said.

The bank received more than 370,000 PPP applications, Halldin said.

BofA was entitled to: 5% on loans up to $350,000; 3% on loans between $350,000 and $2 million; and 1% on loans between $2 million and $10 million. It could make as much as $17,500 on loans up to $350,000; up to $60,000 on loans between $350,000 and $2 million; and up to $100,000 for loans between $2 million and $10 million, according to the lawsuit.

So, from this, there’s a monetary incentive for Bank of America to focus on larger loans. The Biden Administration should change this to give more weight to smaller loans because they reflect the needs of truly small business.

Bank of America’s Chief Operating Officer Tom Montag Was A Major GOP Donor

Tom Montag - Bank of America COO
Tom Montag – Bank of America COO

And Bank of America’s second-in-command, Tom Montag, was revealed to be a major GOP donor:

A senior Bank of America executive has become a top Republican donor in banking, aggressively funding GOP congressional candidates in a practice that others in his business have shunned.

Chief Operating Officer Tom Montag, who oversees Bank of America’s investment bank, donated $641,889 to political causes in the 2019-20 election cycle — almost all to Republican candidates for Congress.

That’s up from $583,700 for the 2017-18 cycle, and far higher than his giving before the administration of President Donald Trump, according to Federal Elections Commission data compiled for the Observer by the Center for Responsive Politics. In the 2014 election cycle, he gave only $97,900.

Montag’s donations make him one of the top donors to Republican causes in the banking industry. According to federal records, he did not donate to the Trump campaign, or any other GOP efforts.

Read more here: https://www.charlotteobserver.com/news/business/banking/article246842982.html#storylink=cpy

And Bank of America Corp and Duke Energy Corp were the two largest donors to the Republican National Convention according to federal financial disclosures, as you can see here.

And on September 2, 2018, The Washington Monthly asked this question, and made a shocking claim:

Why is Bank of America Helping Trump?

America’s major financial institutions are helping maintain institutionalized racism past and present.

For me as a Bank of America Customer, the fact is they have the right to invest in whatever political faction, but smart companies make sure to balance their contributions. I want Bank of America to fix the PPP Loan Program (and stop monkeying around with my application) to make it work, regardless of who’s in the White House. I suspect JoEllen Plaskett and others who bank with Bank of America, want the same thig. Right now, Bank of America looks like its trying to help Trump and the GOP by doing what it can to not help people in America under President Biden’s term. Congress should make such actions against the law: no company should work to hamper an administration’s programs that are designed to help the public.

In closing if you have a story to add to this, email me at Zennie@Zennie62Media.net

Stay tuned for updates.

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