SIGPR Quarterly Report to Congress

Document type: report
Date: 2021-02-01

Full text

Quarterly Report to the United States
Congress

October 1, 2020 - December 31, 2020

Office of the Special Inspector General for
Pandemic Recovery

MISSION
SIGPR strives to ensure that the American taxpayer gets the best return on
investment by promoting the economy, efficiency, effectiveness, and integrity of
CARES Act funds and programs.

VISION
To safeguard CARES Act funds and programs.

VALUES
Accountability
SIGPR will hold itself and others to the highest personal, professional, and ethical
standards.
Integrity
SIGPR will demonstrate the highest levels of professionalism, independence,
fairness, and quality in its work and operations.
Independence
SIGPR will maintain its independence by objectively following the facts and the
law.
Effectiveness
SIGPR will leverage strategic partnerships to protect funds and programs from
fraud and promote best practices in the management of program operations.
Fidelity to the Law
SIGPR will follow and apply the law fairly.

SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY | QUARTERLY REPORT TO CONGRESS | OCTOBER 1- DECEMBER 31, 2020

CONTENTS

INTRODUCTORY MESSAGE
1
Message from the Special Inspector General
2
OFFICE OF THE SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY
4
Statutory Authority
5
Strategic Plan
5
SIGPR in Action
6
SIGPR OFFICES AND ACTIVITIES
15
SIGPR Offices
16
Building Partnerships
20
SIGPR FINDINGS AND REPORTABLE DEVELOPMENTS
22
Direct Loans and Other Investments
23
Letters of Inquiry
37
APPENDICES
38
Appendix A
39
Appendix B
44
Appendix C
47

SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY | QUARTERLY REPORT TO CONGRESS | OCTOBER 1- DECEMBER 31, 2020

INTRODUCTORY MESSAGE

INTRODUCTORY MESSAGE
SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY | QUARTERLY REPORT TO CONGRESS | OCTOBER 1 - DECEMBER 31, 2020

2
Message from the Special Inspector General
As we begin to turn the corner on the global pandemic—and the economic fallout from it—it is
important that Americans be able to maintain confidence in their government and its
institutions. That is as true with respect to CARES Act implementation as it is in any other
context. The CARES Act is hundreds of pages long, established dozens of programs administered
by myriad agencies, and pushed out trillions of taxpayer dollars. Such an undertaking demands
transparency and accountability. Congress understood this when it created an oversight
trifecta—the Office of the Special Inspector General for Pandemic Recovery, the Pandemic
Response Accountability Committee, and the Congressional Oversight Commission—to
complement existing offices of inspector general in rooting out fraud, waste, and abuse under
the CARES Act.
As I have explained in previous reports, the oversight architecture created by the CARES Act is
complex. But so is the CARES Act. The unprecedented challenges of a global pandemic required
unprecedented solutions, and those unprecedented solutions require unprecedented oversight.
The concept of a Special IG, of course, is not unprecedented—nor are its challenges. Special IGs
like SIGPR are asked to parachute into an existing agency that has existing inspectors general to
execute a specific mission with a limited budget and limited time. And in many ways, Special IGs
are at an institutional disadvantage. That is why my goal from the beginning has been to
partner with other offices of inspector general and law enforcement agencies. This partnership-
driven approach has, by and large, been extremely fruitful. It has allowed SIGPR to pursue its
unique mission, and support the missions of its partners, while leveraging the resources and
expertise of existing entities and their exceptional staff to achieve the shared goal of ensuring
the integrity of the programs under our jurisdiction.
With this framework in mind, I am pleased to report that SIGPR is actively engaged in numerous
proactive initiatives to develop and refer leads, including through ongoing audit and
investigations work. As discussed more fully in the report, SIGPR accomplished the following:
• We uncovered and developed new investigative leads relating to suspected fraud under
various CARES Act programs through our internal proactive efforts, and referred 69
leads to law enforcement partners, including fellow inspectors general.
• We initiated five new preliminary investigations, four of which were generated
internally by our proactive efforts, with three of the five currently being worked with
U.S. Attorneys’ Offices.
• We received and vetted 27 complaints, two of which were referred to law enforcement
partners and one of which was opened internally.
• We developed “risk scores” for a Main Street Lending Program dataset, which
identified potential leads for further review and/or referral.
In this report, we also present new data on the loans and other investments made by the
Secretary of the Treasury under Title IV of the CARES Act. We provide a high-level overview of
one of our office’s many investigative tools. And we include a brief analysis of “multiple-

INTRODUCTORY MESSAGE
SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY | QUARTERLY REPORT TO CONGRESS | OCTOBER 1 - DECEMBER 31, 2020

3
dipping,” where an entity obtains funding from two or more CARES Act programs. The creation
of multiple programs resulting in multiple forms of financial support to one entity may be
sound policy, but it also increases the risk of fraud and abuse. We will continue to monitor
closely this area of risk.
As I explained in the last two reports to Congress, SIGPR necessarily spent much of its nascent
stage navigating the challenges of standing up an office in the midst of a pandemic. But our
early efforts have borne fruit. And what I hope this report makes clear is that our office is
operational and formidably aggressive. In partnership where possible, we continue to follow
the facts through audits and investigations to uncover large-scale fraud, waste, and abuse.
That is where things stand, and that is where things are going. We are proud of what we have
achieved in a matter of months and look forward to doing much more to protect the federal
treasury, defend the American taxpayers, and bring bad actors to justice. So, as families across
the country are focused on the health and well-being of their loved ones, know this: SIGPR and
its partners are working together tirelessly to protect your hard-earned money and ensure the
federal relief Congress provides gets to those it is designed to help.
Congress expects it, and you deserve it.

Brian D. Miller
Special Inspector General
January 31, 2021

SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY | QUARTERLY REPORT TO CONGRESS | OCTOBER 1 - DECEMBER 31, 2020

OFFICE OF THE SPECIAL
INSPECTOR GENERAL FOR
PANDEMIC RECOVERY

OFFICE OF THE SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY
SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY | QUARTERLY REPORT TO CONGRESS | OCTOBER 1 - DECEMBER 31, 2020

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Statutory Authority
In March 2020, Congress reached a bipartisan agreement that provided relief to Americans
suffering during the pandemic, passing the Coronavirus Aid, Relief, and Economic Security
(CARES) Act, Public Law 116-136. The CARES Act established an oversight framework with
jurisdictional overlap. As part of this framework, Section 4018 of the CARES Act charges SIGPR
specifically to conduct audits and investigations of (1) loans, loan guarantees, and other
investments made by the Secretary of the Treasury under any program established by the
Secretary under Division A of the CARES Act; and (2) the management by the Secretary of the
Treasury of programs established under Division A of the CARES Act.1 The CARES Act also
provides that “the Special Inspector General shall have the authorities provided in Section 6 of
the Inspector General Act of 1978” (IG Act).2 Through this express incorporation of the IG Act,
the CARES Act grants SIGPR broad subpoena authority.3

Strategic Plan
During this reporting quarter, SIGPR finalized its strategic plan. The plan includes the following
mission, vision, values, goals, and objectives for Fiscal Years 2021–23.
Mission: SIGPR strives to ensure that the American taxpayer gets the best return
on investment by promoting the economy, efficiency, effectiveness, and integrity
of CARES Act funds and programs.
Vision: To safeguard CARES Act funds and programs.
Values: Accountability, Integrity, Independence, Effectiveness, Fidelity to Law

SIGPR’s strategic goals and objectives

1 CARES Act § 4018(c)(1).
2 CARES Act § 4018(d)(1).
3 See 5a U.S.C. § 6(a)(4).

OFFICE OF THE SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY
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SIGPR in Action
SIGPR’s formative efforts have borne fruit: the office is operational and aggressively identifying
fraud, waste, and abuse. SIGPR’s proactive initiatives continue to develop leads, as we pursue
ongoing audit work and investigations. As discussed below, SIGPR’s work has produced results.
Specifically, it has:
• Uncovered and developed new investigative leads relating to suspected fraud under
various CARES Act programs through SIGPR’s internal proactive efforts, referring 69 of
those leads to law enforcement partners, including fellow inspectors general.
• Initiated five new preliminary investigations, four of which were generated internally by
SIGPR’s proactive efforts, with three of the five currently being worked with U.S.
Attorneys’ Offices;
• Received and vetted 27 complaints during this quarter, referring two to law
enforcement partners and opening another internally; and
• Developed “risk scores” for a Main Street Lending Program dataset, which identified
potential leads for further review and referrals.
As noted in its first two reports to Congress, SIGPR necessarily spent much of its nascent stage
recruiting employees, navigating administrative and logistical issues (such as acquiring office
space and developing information technology infrastructure), building partnerships to leverage
institutional knowledge and law-enforcement capabilities, mastering the details of the
hundreds of billions of dollars in CARES Act programming under its jurisdiction, and
methodically developing strategies to detect and expose illegal conduct. This critical front-end
work, though encumbered by the challenges of a global pandemic, has prepared the office for
its vital oversight work.
SIGPR highlights two areas of focus below: multiple-dipping under the CARES Act and reporting
under the Bank Secrecy Act.
Multiple-Dipping Under the CARES Act
In its Initial Report to Congress, SIGPR identified “multiple-dipping” by CARES Act participants as
a key issue to watch.4 SIGPR cautioned that the existence of “multiple programs resulting in
multiple forms of financial support to a single individual or entity” creates an increased “risk of
fraud and abuse.”5 This increased risk is highlighted by various CARES Act rules that speak
directly to the issue of multiple-dipping, as well as rules regarding the related issue of a CARES
Act recipient’s adequate access to capital.
It is worth noting that no individual or entity may receive money from the federal government
twice for the same purpose. For example, and as reported in the table below, on June 18, 2020,
the Office of Management and Budget (OMB) issued guidance addressing administrative relief

4 See Initial Report to Congress, Special Inspector General for Pandemic Recovery, at 49–50 (Aug. 3, 2020),
https://www.sigpr.gov/sites/sigpr/files/2020-09/SIGPR-Initial-Report-to-Congress-August-3-2020_0.pdf.
5 Id. at 50.

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designed to assist recipients of certain federal grants. Part of the relief discussed in the OMB
guidance allowed certain grantees “to continue to charge salaries and benefits to active Federal
awards,” even while those grantees were forced to suspend project activity.6 But the guidance
specifically warned that “payroll costs paid with the Paycheck Protection Program (PPP) loans
or any other federal CARES Act programs must not be also charged to current federal awards as
it would result in the Federal Government paying for the same expenditures twice.”7 This
general principle makes sense: if an individual or entity receives funding from the federal
government twice for the same purpose, only one of the funding streams can be put to the use
for which it was granted, meaning the second funding stream represents waste, at best, or
fraud, at worst.
Against the backdrop of this general principle come program-specific rules delineated by the
text of the CARES Act. Some rules unambiguously bar certain forms of double-dipping. For
instance, a recipient of a direct Department of the Treasury (Treasury) loan made under Section
4003 may not also participate in the Federal Reserve’s Main Street Lending Program (MSLP).
Other rules do not necessarily bar specific instances of double or multiple-dipping but do raise
the possibility that participation in one or more CARES Act programs could render an individual
or entity ineligible for other programs due to express rules regarding an applicant’s access to
capital. As SIGPR stated in its Initial Report to Congress, such “express statutory limitations raise
the question whether a loan applicant that has received or expects to receive millions of dollars
under other CARES Act programs can reasonably certify to a lack of access to adequate
capital.”8
To follow up on the concerns about multiple-dipping that SIGPR raised in its Initial Report to
Congress, SIGPR further analyzed the issue and has engaged in a proactive initiative to identify
areas of potential waste, fraud, or abuse. The table below, also found in Appendix A,
summarizes the most relevant program-specific rules relating to capital access and multiple-
dipping under the CARES Act. While the table includes rules and information on programs not
directly under SIGPR’s jurisdiction, the rules are relevant to SIGPR’s oversight if an individual or
entity could violate such rules by participation in a program over which SIGPR does have
jurisdiction.
CARES Act Program
Rules Relating to Access to Multiple Streams of Funds
Section 4003 Loans
(Title IV, Subtitle A)
•
Credit Availability Review. A borrower is eligible if “credit is not reasonably available” to
the borrower “at the time of the” loan.i Treasury “and its financial and legal advisors will
take into account evidence from the prospective borrower’s particular circumstances,
including its relationships with existing and potential creditors, as well as general market
conditions.”ii

•
Additional stipulations for non-air-carrier businesses. Businesses may be eligible if they
are non-air-carrier U.S. businesses that “have not otherwise received adequate economic

6 Memorandum to the Heads of Executive Departments and Agencies M-20-26, Office of Management and Budget, at Appendix
A (June 18, 2020), https://www.whitehouse.gov/wp-content/uploads/2020/06/M-20-26.pdf.
7 Id.
8 Initial Report to Congress, supra note 4, at 50.

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CARES Act Program
Rules Relating to Access to Multiple Streams of Funds
relief in the form of loans or loan guarantees provided under the CARES Act that are
certified under 14 CFR Part 145 and approved to perform inspection, repair, replace, or
overhaul services (‘Part-145 certified repair station operators’); ticket agents as defined in
49 U.S.C. § 40102; or businesses critical to maintaining national security.”iii

•
Federal Reserve Facilities. A recipient of a loan under Section 4003 is not eligible to
receive support under the Main Street Lending Program or either of the Corporate Credit
Facilities.
Main Street Lending
Program (MSLP)
(Title IV, Subtitle A)
•
PPP Recipients: The Federal Reserve has taken the positioniv that “a Business that has
received PPP loans, or that has affiliates that have received PPP loans, is permitted to
borrow under Main Street, provided that the Business is an Eligible Borrower.”v An MSLP
borrower, however, must complete a certification form reporting its PPP debt load.vi

•
Economic Injury Disaster Loan (EIDL) Recipients: Similarly, a business receiving a loan
under the SBA’s “EIDL program can be an Eligible Borrower under Main Street if it meets
the Eligible Borrower criteria.”vii

•
An entity eligible for more than one of the Main Street Lending Program facilities—the
Main Street Priority Loan Facility (MSPLF); the Main Street New Loan Facility (MSNLF); the
Main Street Expanded Loan Facility (MSELF); the Nonprofit Organization New Loan Facility
(NONOLF); or the Non-profit Organization Expanded Loan Facility (NOELF)—may only
participate in one.

•
An entity that participates in any one of the Main Street Lending Programs cannot also
participate in the Primary Market Corporate Credit Facility or the Secondary Market
Corporate Credit Facility.viii An entity that participates in either the NONOLF or the NOELF
may not also participate in the Municipal Liquidity Facility.ix
Primary Market Corporate
Credit Facility (PMCCF)
(Title IV, Subtitle A)
•
An eligible entity “may not participate in the PMCCF and a Main Street Lending Facility.”x

•
An eligible entity “must not have received specific support pursuant to the CARES Act or
any subsequentxi federal legislation.”

•
An eligible entity may “utilize tax credits or tax relief in the CARES Act and still participate
in the CCFs.”xii

•
Secondary Market Corporate Credit Facility (SMCCF) Participants Subject to Per-Issuer
Limits. An eligible entity may “participate in . . . the PMCCF at the same time its bonds
have been or are being purchased by the SMCCF . . . but the collective purchases by the
PMCCF and SMCCF of an eligible issuer’s debt are subject to the per-issuer limits described
in the respective Term Sheets.”xiii
Secondary Market
Corporate Credit Facility
(SMCCF)
(Title IV, Subtitle A)
•
An “eligible issuer must not have received specific support pursuant to the CARES Act or
any subsequent federal legislation.”xiv

•
“An issuer may utilize tax credits or tax relief in the CARES Act and still participate in the
CCFs.”xv

•
PMCCF Participants Subject to Per-Issuer Limits. “An eligible issuer [may] participate in . .
. the PMCCF at the same time its bonds have been or are being purchased by the SMCCF . .

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CARES Act Program
Rules Relating to Access to Multiple Streams of Funds
. but the collective purchases by the PMCCF and SMCCF of an eligible issuer’s debt are
subject to the per-issuer limits described in the respective Term Sheets.”xvi
Term Asset-Backed
Securities Facilities (TALF
II)
(Title IV, Subtitle A)
•
Credit Availability Review. “Under the Board’s Regulation A, the New York Fed must
obtain evidence that participants in the TALF are unable to secure adequate credit
accommodations from other banking institutions . . . . Lack of adequate credit does not
mean that no credit is available. Credit may be available, but inadequate in its amount,
price, or terms.”xvii

•
“SBA Pool Certificates that include PPP loans in the underlying collateral pool are eligible
ABS.”xviii

•
Procedure for Requesting Multiple Loans. “An eligible borrower may request an unlimited
number of loans at each subscription date . . . . If a borrower requests loans through
multiple TALF Agents, it must deliver the collateral for each loan through the respective
TALF Agent, unless the collateral is a new issuance delivered by the underwriter/other
syndicate desk.”xix

•
ABS Issued by Recipients of Loans under Section 4003(b)(1)-(3). “Eligible ABS do not
include ABS issued by or sponsored by (or, in the case of CLOs, with collateral managers
which are) U.S. entities that have received specific support pursuant to Section 4003(b)(1)-
(3) of the Coronavirus Aid, Relief, and Economic Security Act of 2020 (Subtitle A of Title IV
of the CARES Act).”xx
Payroll Support Program
(PSP)
(Title IV, Subtitle B)
•
No Express Prohibitions on Other CARES Act Support. Treasury appears to have issued no
specific guidance, stating only that “[a]n air carrier or contractor that has applied for or
received support under other provisions of the CARES Act is precluded, by virtue of such
application or support, from applying for and receiving Payroll Support. The eligibility
criteria for other CARES Act support programs are set forth in the Act and any applicable
guidance or regulations.”xxi
Coronavirus
Relief Fund
(Title V)
•
Local Governments Eligibility. The CARES Act does not explicitly prevent local
governments (regardless of their eligibility for direct assistance) from receiving
Coronavirus Relief Fund payments from state governments, so long as the funds are used
for eligible purposes.
Paycheck Protection
Program (PPP)
•
Loan Must Be New in Purpose and Amount. “An eligible recipient applying for a covered
loan shall make a good faith certification . . .”
o
“that the eligible recipient does not have an application pending for a loan under
this subsection for the same purpose and duplicative of amounts applied for or
received under a covered loan . . . .”xxii
o
“during the period beginning on February 15, 2020 and ending on December 31,
2020, that the eligible recipient has not received amounts under this subsection
for the same purpose and duplicative of amounts applied for or received under a
covered loan.”xxiii

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CARES Act Program
Rules Relating to Access to Multiple Streams of Funds
obligations described in subparagraph (F) from receiving assistance under this
paragraph.”xxiv
o
“Borrowers can apply for both the PPP and EIDL, although funds from both
cannot be used for the same purpose.”xxv
o
“If you took out an Economic Injury Disaster Loan (EIDL) between February 15,
2020 and June 30, 2020 and you want to refinance that loan into a PPP loan, you
would add the outstanding loan amount to the payroll sum.”xxvi

•
Rules for Current Federal Awards. “[P]ayroll costs paid with the Paycheck Protection
Program (PPP) loans or any other Federal CARES Act programs must not be also charged to
current Federal awards as it would result in the Federal government paying for the same
expenditures twice.”xxvii

•
MSLP Recipients: The Federal Reserve has taken the position that “a Business that has
received PPP loans, or that has affiliates that have received PPP loans, is permitted to
borrow under Main Street, provided that the Business is an Eligible Borrower.”xxviii But an
MSLP borrower must complete a certification form reporting its PPP debt load.xxix

Economic Injury Disaster
Loan (EIDL)
•
SBA Guidance Regarding PPP Recipients. “Borrowers can apply for both the PPP and EIDL,
although funds from both cannot be used for the same purpose.”xxx

•
New SBA Loans Must Be Separate. “Each SBA Disaster Loan is a separate loan; they
cannot be consolidated or used to pay off earlier loans. If you qualify for another SBA
disaster loan due to a different declared disaster in your area, the new loan must be used
for the purposes listed in your loan closing documents, which may include working capital
or physical damage repairs. It cannot be used to refinance or payoff existing SBA disaster
loans from previous disaster events, including COVID-19.”xxxi

•
A business that already has both an EIDL loan and a PPP loan “may still qualify for a new
SBA disaster loan for losses resulting from a declared disaster in your community.”xxxii

•
Main Street Lending. A business receiving a loan under the SBA’s “EIDL program can be an
Eligible Borrower under Main Street if it meets the Eligible Borrower criteria.”xxxiii

i CARES Act § 4003(c)(2)(A).
ii https://home.treasury.gov/system/files/136/CARES-Airline-Loan-Support-Q-and-A-national-security.pdf.
iii https://home.treasury.gov/system/files/136/CARES-Airline-Loan-Support-Q-and-A-national-security.pdf.
iv The Federal Reserve’s position on the eligibility of PPP and EIDL recipients for the MSLP appears to stem from an
interpretation of CARES Act § 4002(4)(B) that is at odds with how the Department of the Treasury has interpreted that same
provision. CARES Act § 4002(4)(B) defines the term “eligible business” as a non-air-carrier “United States business that has not
otherwise received adequate economic relief in the form of loans or loan guarantees provided under this Act.” In its guidance
regarding the loan program under Title IV, Subtitle A, Treasury further defines the term “eligible business,” in part, as non-air-
carrier “businesses certified by the Department of Transportation under 14 C.F.R. Part 145 . . . that have not otherwise received
adequate economic relief in the form of loans or loan guarantees under other programs authorized by the Act.” Procedures and
Minimum Requirements for Loans to Air Carriers and Eligible Businesses and National Security Businesses under Division A, Title
IV, Subtitle A of the Coronavirus Aid, Relief, and Economic Security Act, U.S. Dep’t Treasury, at 2 (March 30, 2020),
https://home.treasury.gov/system/files/136/Procedures%20and%20Minimum%20Requirements%20for%20Loans.pdf. That
guidance defines “the Act” as the entire CARES Act. Id. at 1. Accordingly, it appears Treasury understands the definition of
“eligible business,” as provided in CARES Act § 4002(4)(B), to exclude otherwise qualifying non-air-carrier businesses that have

OFFICE OF THE SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY
SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY | QUARTERLY REPORT TO CONGRESS | OCTOBER 1 - DECEMBER 31, 2020

received an adequate loan or loan guarantee under any program established under the CARES Act. This would not allow an
MSLP applicant to have participated in the PPP. The Federal Reserve’s guidance, however, provides that an MSLP applicant
“must not have received specific support pursuant to the Coronavirus Economic Stabilization Act of 2020 (Subtitle A of Title IV
of the CARES Act),” which the Federal Reserve clarifies to mean that “[a] Business is not eligible [for the MSLP] if it has received
support pursuant to Section 4003(b)(1)-(3) of the CARES Act.” Main Street Lending Program FAQs, For-Profit Businesses, Board
of Governors of the Federal Reserve System, at 27 (Dec. 29, 2020), https://www.bostonfed.org/mslp-faqs. Accordingly, it
appears the Federal Reserve understands the definition of “eligible business,” as provided in CARES Act § 4002(4)(B), to exclude
only those otherwise qualifying non-air-carrier businesses that have received an adequate loan or loan guarantee under Title IV,
Subtitle A. This would allow an MSLP applicant to have participated in the PPP.
v https://www.bostonfed.org/mslp-faqs.
vi https://www.bostonfed.org/-/media/Documents/special-lending-facilities/mslp/legal/ppp-forgiveness-form.pdf?la=en.
vii https://www.bostonfed.org/mslp-faqs.
viii https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq.
ix https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20201030a4.pdf;
https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20201030a5.pdf.
x https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq.
xi Notably, the prohibition against receiving specific support under “subsequent federal legislation” appears to be unique to the
Corporate Credit Facilities and is not incorporated into the Federal Reserve’s guidance regarding other facilities—nor is such a
prohibition included in Treasury’s guidance, which, as explained above, deviates slightly from the guidance issued by the
Federal Reserve.
xii https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq.
xiii https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq.
xiv https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq. “To participate in
the PMCCF as an issuer or in the SMCCF as an issuer of eligible individual corporate bonds, the issuer must certify that it has not
received specific support pursuant to the CARES Act. This issuer certification is not required in connection with the SMCCF
broad market index purchase program. "Specific support" in this context means specific support pursuant to Section 4003(b)(1)-
(3) of the Coronavirus Economic Stabilization Act of 2020 (Subtitle A of Title IV of the CARES Act) . . . . An issuer will not be
eligible for the PMCCF or SMCCF if it has received a loan, loan guarantee, or other investment from the Treasury Department
under Section 4003(b)(1)-(3).” Id.
xv https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq.
xvi https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq.
xvii https://www.newyorkfed.org/markets/term-asset-backed-securities-loan-facility/term-asset-backed-securities-loan-facility-
faq.
xviii https://www.newyorkfed.org/markets/term-asset-backed-securities-loan-facility/term-asset-backed-securities-loan-facility-
faq.
xix https://www.newyorkfed.org/markets/term-asset-backed-securities-loan-facility/term-asset-backed-securities-loan-facility-
faq.
xx https://www.newyorkfed.org/markets/term-asset-backed-securities-loan-facility/term-asset-backed-securities-loan-facility-
faq.
xxi https://home.treasury.gov/system/files/136/QandA-Payroll-Support-to-Air-Carriers-and-Contractors.pdf.
xxii CARES Act § 1102 (15 USC 636(a)(36)(G)(i)(III)).
xxiii CARES Act § 1102 (15 USC 636(a)(36)(G)(i)(IV)).
xxiv CARES Act § 1102 (15 USC 636(a)(36)(Q)).
xxv https://www.sba.gov/sites/default/files/2020-11/COVID%20EIDL%20FAQ%20rev%20112320-508.pdf.
xxvi https://www.sbc.senate.gov/public/_cache/files/2/9/29fc1ae7-879a-4de0-97d5-
ab0a0cb558c8/1BC9E5AB74965E686FC6EBC019EC358F.the-small-business-owner-s-guide-to-the-cares-act-final-.pdf.
xxvii https://www.whitehouse.gov/wp-content/uploads/2020/06/M-20-26.pdf.
xxviii https://www.bostonfed.org/mslp-faqs.
xxix https://www.bostonfed.org/-/media/Documents/special-lending-facilities/mslp/legal/ppp-forgiveness-form.pdf?la=en.
xxx https://www.sba.gov/sites/default/files/2020-11/COVID%20EIDL%20FAQ%20rev%20112320-508.pdf. SBA also previously
provided the following guidance: “Note that businesses that received an EIDL Advance in addition to the PPP loan will have the
amount of the EIDL Advance subtracted from the forgiveness amount of their PPP loan.” The rule underlying that guidance,
however, has since been repealed, and the repeal is intended to apply retroactively. See Economic Aid Act § 333(c), (d).
xxxi https://www.sba.gov/sites/default/files/2020-11/COVID%20EIDL%20FAQ%20rev%20112320-508.pdf.
xxxii https://www.sba.gov/sites/default/files/2020-11/COVID%20EIDL%20FAQ%20rev%20112320-508.pdf.
xxxiii https://www.bostonfed.org/mslp-faqs.

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Financial Investigations Under the Bank Secrecy Act
One of the early partnerships SIGPR established was with Treasury’s Financial Crimes
Enforcement Network (FinCEN). In August 2020, SIGPR entered a Memorandum of
Understanding (MOU) with FinCEN, which authorized SIGPR users to access FinCEN’s database
of Bank Secrecy Act (BSA) reports and its accompanying query tools. Shortly thereafter, SIGPR
began a robust and ongoing analysis of BSA information in pursuit of fraud, waste, and abuse in
CARES Act programs under SIGPR’s jurisdiction.
For years, law enforcement agencies at all levels have proactively analyzed reports of suspicious
financial activity submitted to FinCEN under the BSA. Those reports, submitted by financial
institutions acting to protect the integrity of the U.S. financial system, have led to successful
prosecutions of terrorism financiers, fraudsters of all types, human traffickers, drug kingpins,
money launderers, and countless other criminals.
BSA History
In 1970, Congress first mandated routine financial reporting by enacting the Currency and
Foreign Transactions Reporting Act, Pub. L. No. 91-508, 84 Stat 1118, which required financial
institutions to make reports and keep records “where such reports or records have a high
degree of usefulness in criminal, tax, and regulatory investigations. . . .”9 Congress later
expanded and codified these provisions in Title 31 of the United States Code, as part of what is
commonly known as the “Bank Secrecy Act,” or BSA.
The BSA requires banks, casinos, jewelers, pawnbrokers, loan companies, car dealerships, and
certain other businesses to file reports concerning currency transactions in accord with
regulations established by the Treasury Secretary. The BSA also gives the Secretary broad
authority to require various institutions to file reports beyond those concerning currency
transactions, so long as those additional reports “have a high degree of usefulness in criminal,
tax, and regulatory investigations.”10 BSA regulations now require reporting on a variety of
financial matters, including reports of suspicious financial activity, regardless of whether the
activity involves a currency transaction.
Reports and Filings Required by BSA Regulations
Regulations governing BSA reports reside in Title 31, Subtitle B, Chapter X of the Code of
Federal Regulations. The following paragraphs describe significant reports required by the BSA.
Suspicious Activity Report (SAR). The following financial institutions are required to file
a SAR: Banks, including Bank and Financial Holding Companies; Casinos and Card Clubs;
Money Services Businesses; Brokers or Dealers in Securities; Mutual Funds; Insurance
Companies; Futures Commission Merchants and Introducing Brokers in Commodities;
Residential Mortgage Lenders and Originators, and Housing Government Sponsored
Enterprises.

9 Currency and Foreign Transactions Reporting Act, Pub. L. No. 91-508, 84 Stat 1118, § 202.
10 31 U.S.C. § 5311.

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Currency Transaction Report (CTR). Generally, financial institutions that are required to
file a CTR include banks, other types of depository institutions, casinos and card clubs,
brokers or dealers in securities, money transmitters, currency exchangers, check
cashers, and issuers/sellers/payers of money orders and traveler’s checks. Only those
casinos, gambling casinos, or card clubs in the United States that have gross annual
gaming revenues in excess of $1 million are financial institutions for purposes of the
FinCEN CTR.
Form 8300. Any person in a trade or business who, in the course of that trade or
business, receives more than $10,000 in cash in a single transaction or in two or more
related transactions, must file FinCEN Form 8300.
Currency or Monetary Instrument Report (CMIR). (a) Each person who physically
transports, mails, or ships, or causes to be physically transported, mailed, or shipped
currency or other monetary instruments in an aggregate amount exceeding $10,000 at
one time from the United States to any place outside the United States or into the
United States from any place outside the United States, and (b) each person who
receives in the United States currency or other monetary instruments in an aggregate
amount exceeding $10,000 at one time which have been transported, mailed, or
shipped to the person from any place outside the United States.
Foreign Bank and Financial Account Report (FBAR). A United States person that has a
financial interest in or signature authority over foreign financial accounts must file an
FBAR if the aggregate value of the foreign financial accounts exceeds $10,000 at any
time during the calendar year.
These reports are of significant value to investigators working to identify criminal activity and
its tainted financial spoils. Investigating suspicious financial transactions—the day-to-day work
of “following the money”—will often uncover a range of criminal activity, from narcotics
trafficking, to terrorism financing, to federal-program fraud. And even those not directly
responsible for these offenses may nonetheless face criminal money-laundering charges for
transactions using money derived from criminal activity. BSA regulations require filing a SAR
when an institution believes an individual is dealing in funds derived from criminal proceeds or
conducting financial transactions that suggest an effort to conceal the nature or ownership of
those funds. These activities relate directly to conduct prohibited by 18 U.S.C. §§ 1956 and
1957, the federal code’s principal criminal money-laundering provisions.
Identifying suspicious activity and making reports are important first steps. Importantly, these
reports are collected and organized in a comprehensive database, providing effective search
tools to investigators. To that end, BSA regulations mandate that institutions file their reports
with FinCEN, a Treasury bureau described in more detail below.
FinCEN Background
Former Treasury Secretary Nicholas F. Brady created FinCEN in 1990 with Treasury Order 105-
08, assigning FinCEN’s director the responsibility of coordinating a diverse staff of financial
experts “to centralize and combine expertise on both national and international financial

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systems and the detection and prevention of money laundering and other financial crimes.”11 It
was given responsibility for centralizing the collection and dissemination of BSA reports and
providing “research, analytical, and information services” to financial institutions, regulators,
and law enforcement.12
In Title III of the USA PATRIOT Act of 2001, Congress significantly strengthened federal money-
laundering laws, enhancing FinCEN’s role in combating financial crimes. Among its provisions,
the Act required financial institutions to implement robust anti-money laundering programs,
including increased due-diligence procedures when reviewing customer activity. These
measures greatly enhanced the value of BSA reports filed by financial institutions, effectively
making those institutions partners in detecting financial crimes.
Today, FinCEN is the world’s premier financial-intelligence organization, providing invaluable
data and intelligence services to a wide array of law-enforcement agencies. In 2019, depository
institutions filed over 1 million SARs with FinCEN. Innovative search capabilities allow law-
enforcement agencies to query these filings proactively in their efforts to detect, investigate,
and prosecute all manner of financial and other crimes, as well as the accompanying illicit
efforts to launder the proceeds from these activities.
FinCEN and the Coronavirus Pandemic
With this history and mission, it comes as no surprise that in the Nation’s response to the
coronavirus pandemic, FinCEN has been and continues to be a leader in combating fraud,
waste, and abuse. On May 18, 2020, FinCEN issued its first advisory to BSA filers, warning them
of “rising medical scams related to the COVID-19 pandemic.” The advisory identified numerous
“red flags” that FinCEN found indicative of scams related to fake cures, vaccines, and
treatments for COVID-19. FinCEN also identified warning signs for fraud and price-gouging in
the sale of personal protective equipment. FinCEN issued subsequent advisories in July 2020,
warning filers of various cybercrime, imposter, and money-mule schemes designed to exploit
the pandemic. Most recently, FinCEN advised filers to beware of unemployment-insurance
fraud.
CARES Act crimes are financial crimes, making FinCEN a natural partner for SIGPR in fulfilling its
mission. All the programs at the core of SIGPR’s jurisdiction involve financial institutions either
disbursing funds or receiving funds tied to CARES Act appropriations. Those financial
institutions play an important role in identifying and reporting suspicious financial activity
associated with CARES Act programs. When an institution files a SAR, it identifies one or more
categories of suspicious activity implicated by the conduct described in the SAR. In the SARs
filed since passage of the CARES Act, institutions have selected suspicious activity categories
related to loan fraud, government program fraud, bribery, embezzlement, and similar
misconduct more than 300,000 times. Should any of that activity involve CARES Act funds under
SIGPR’s jurisdiction, SIGPR will vigorously investigate.

11 Treasury Order 105-08, 3(a), Establishment of the Financial Crimes Enforcement Network, April 15, 1990.
12 Id. at 3(f).

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SIGPR OFFICES AND ACTIVITIES

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SIGPR Offices
SIGPR employs proactive efforts to prevent, detect, and investigate fraud, waste, and abuse
involving CARES Act funds and programs within SIGPR’s jurisdiction. These include the
following:
• The Office of Audits has reviewed volumes of information to conduct data analysis for
audit and evaluative work of CARES Act programs: it will continue to make investigative
referrals;
• The Office of Investigations has fielded and vetted numerous allegations, to include
those stemming from SIGPR’s proactive efforts based on its own review of voluminous
documents, to identify potential fraud for referral or internal follow-up; and
• All offices have coordinated and communicated with partners to leverage the expertise
and resources essential for a start-up organization with limited resources, while SIGPR
continues to onboard staff and build an organizational infrastructure during a pandemic.
SIGPR’s aggressive preparation—while investigations and audits are by necessity and design
conducted behind the scenes—will remain largely invisible to the public until charges or
complaints are filed or audits are announced. Much of this was made possible only because
SIGPR initially built the in-house organizational framework and legal expertise necessary to
support, sufficiently understand, and interpret newly enacted laws and programs, as well as
their terms and conditions. Ferreting out financial fraud is complex and takes time.
Audits
The Office of Audits conducts audits, reviews, and evaluations of loans, loan guarantees, and
other investments made by Treasury under any program established under Division A of the
CARES Act as well as Treasury’s management of programs established under Division A of the
CARES Act.13
Ongoing Activities
As the Office of Audits team takes shape, one of its first tasks has been to identify the many
datasets that will make up the initial areas for evaluation. As such, it has populated databases
with CARES Act funding recipient information. These datasets are derived from several
programs, including the Main Street Lending Program (MSLP), the Coronavirus Relief Fund, and
Section 4003 loans. They contain more than 24.1 million rows of data, totaling more than
$96.85 billion in CARES Act funding.
The Office of Audits will take an analytic approach to individually “risk score” these datasets
and use the risk assessments to decide on areas to review. This approach will be based on a
detailed analysis to pinpoint financial risks of all CARES Act programs—a process that is critically
important to the mission of SIGPR. The Office of Audits will also refer instances of suspected
abuse that fall outside the scope of its mandate to other SIGPR offices or outside agencies.

13 CARES Act § 4018(c)(1).

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In addition, this data-driven process will allow audit teams to deliver a premier, qualitative view
of financial processes and results. A natural by-product of the evaluation process is to generate
vital insights and provide potential investigative leads. This information will enable audit team
members to consider key performance indicators of multiple operational aspects, as well as
variances, relationships, patterns and anomalies. It will eventually offer new objectives and
overall perspectives on the use of CARES Act funding.
Thus far, the Office of Audits has developed “risk scores” for the MSLP dataset and has already
identified instances and potential leads for further review and referrals. Soon, the office will
expand the currently available informational fields to obtain and merge additional datasets and
produce an even more robust and extensive analysis. This will aid the Office of Audits’ ability to
review compliance and determine if CARES Act funds are being used as Congress intended for
the American people.
Currently, the Office of Audits is also surveying more focused reviews. It is in the preliminary
stages of evaluating how state and local governments are complying with the CARES Act. To
accomplish this, it is concentrating on numerous alleged instances of abuse, as reported both
publicly and privately through the confidential SIGPR hotline. The Office of Audits will then
determine whether reported allegations fall within SIGPR’s jurisdiction and merit deployment
of additional resources to develop a full-scale project.
Finally, the Office of Audits is working diligently in close partnership with other members of
SIGPR’s team, the Pandemic Response Accountability Committee (PRAC), other offices of
inspectors general, and other federal government entities as necessary to meet its statutory
obligations. The office also provides analytical support to SIGPR’s Office of Investigations to
assist its investigative efforts.
Policy and Procedure Development
Audits, reviews, and other services will be performed in accordance with Generally Accepted
Government Auditing Standards (GAGAS) and Council of the Inspectors General on Integrity and
Efficiency (CIGIE) Quality Standards for Inspection and Evaluation, as appropriate.14 The Office
of Audits also operates under the authorities, duties, and responsibilities of Sections 4 and 6 of
the IG Act.15 These responsibilities include making recommendations to agency leadership to
promote economy and efficiency in agency administration, prevent and detect fraud and abuse,
and facilitate the identification and prosecution of participants in fraud or abuse. To this end,
relevant policies and procedures must be established and implemented.
In December 2020, the Office of Audits began developing policies and procedures in compliance
with GAGAS standards to address audit-level assignments. On December 18, 2020, it issued its
Evaluations Policies and Procedures Manual (EPPM), which applies to evaluations performed by
the Office of Audits and ensures compliance with CIGIE standards. The EPPM is designed to
maintain the integrity of the project teams’ internal operations, as well as the Office of Audits’

14 Quality Standards for Inspection and Evaluation, Council of the Inspectors General on Integrity and Efficiency (Jan. 2012),
available at https://www.ignet.gov/sites/default/files/files/iestds12.pdf.
15 See CARES Act § 4018(c)(3).

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functions. All Office of Audits’ staff participating in evaluations must comply with this manual’s
procedures to ensure that evaluations meet CIGIE standards.
As a logical extension of its new policies and procedures, the Office of Audits is developing an
audit plan that will identify high priority projects. These projects will assess the relevant
financial assistance programs and any others established by Division A of the CARES Act that are
managed or funded by Treasury.
Additionally, the Office of Audits is in the process of developing a curriculum of mandatory
continuing professional education courses. This curriculum will ensure that its staff maintain
the core competencies required to perform the assigned work in accordance with applicable
standards, as well as an ample knowledgebase pertinent to the subject matters under review.
Staffing and Recruitment Efforts
The Office of Audits is continuing to recruit and build a diverse organization. As of December
31, 2020, it is staffed with an Assistant Inspector General for Auditing and five staff members. It
is in the process of onboarding four additional audit staff. Additional staffing needs will be
continuously assessed, taking into consideration appropriated resources and SIGPR’s workload
demands.
Investigations
The Office of Investigations prevents, detects, and investigates allegations of fraud, abuse, or
misconduct involving CARES Act funds and programs within SIGPR’s jurisdiction. In addition, the
office manages SIGPR’s hotline.
During this quarter, the office received 27 complaints. In addition, as of this reporting period,
the Office of Investigations has initiated five preliminary investigations, four of which were
initiated through SIGPR’s own proactive efforts. SIGPR is working in partnership with U.S.
Attorney’s Offices on three of them. These investigations relate to activities that, collectively,
potentially represent millions of dollars of questionable expenditures related to funds
distributed under the CARES Act.
The Office of Investigations continues to participate in several working groups to remain
current on fraud and corruption schemes investigated throughout the federal law enforcement
community. As an example, these working groups include the CIGIE Financial Oversight
Assistant Inspector General for Investigations Working Group and federal OIG Investigation
COVID-19 working groups, including PRAC subcommittees. The Office of Investigations has also
formed new referral protocols with the Office of Compliance Inspections and Examinations
(OCIE) of the Securities and Exchange Commission (SEC) and Treasury’s suspension and
debarment unit in the Office of the Procurement Executive. These new referral protocols have
already produced eight referrals to SIGPR. The office also continues to coordinate closely with
other law-enforcement agencies with the goal of forming law-enforcement partnerships,
including task-force relationships, across the federal government.
The Office of Investigations continues to recruit and focus on staffing. During the latter part of
this reporting period, a special agent with more than 20 years of law enforcement experience

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joined the Office of Investigations staff. Three more investigative staff, including an
investigative research specialist, joined the office in January 2021. With these additional
members, the office can leverage a broad array of expertise and perspectives in developing and
working on complex investigations.
The Office of Investigations is committed to robust criminal and civil enforcement efforts
against those involved in fraud or corruption relating to CARES Act funds. As a team, the office
will remain agile, determined, and focused on returning ill-gotten CARES Act funds to the
American taxpayers, and will help ensure that those stealing them suffer appropriate criminal
or civil consequences.
Administration
The Office of Administration provides comprehensive administrative support to all components
within SIGPR.
Budget Update
Congress appropriated $25 million to SIGPR, and that amount will remain available until
expended.16 SIGPR expects this funding to sustain operations through Fiscal Year (FY) 2021. To
fund ongoing operations beyond FY 2021, SIGPR asked the Office of Management and Budget
to include a $25 million appropriation in the proposed President’s Budget for FY 2022.
SIGPR remains judicious, paying close attention to the expenditure of appropriated funds. It has
realized substantial savings by opting for used furniture, cubicles, chairs, and other office-
related items. Pursuant to an inter-agency agreement, SIGPR leases office space and used
furnishings from the U.S. Patent and Trademark Office (USPTO). The savings will be used for
mission-critical expenditures, including staffing, rent, and travel. Administrative and
information technology (IT) services provided by Treasury are alone estimated to cost
approximately $5 million annually.
Information Technology Update
SIGPR’s partnership and agreement with the USPTO has been instrumental in establishing
SIGPR’s IT operations and has afforded SIGPR staff the time and space to establish its own IT
division.
The detail of SIGPR’s first Chief Information Officer (CIO) ended on November 25, 2020. SIGPR’s
permanent CIO joined the team on December 20, 2020, and SIGPR has continued to
aggressively stand up an IT division internally to provide infrastructure and user services. The
division will leverage the Department of the Treasury’s technologies and off-the-shelf solutions
for SIGPR’s mission-essential investigative case management system, audit report system, and
data analytics platform.
Treasury’s network has been installed at SIGPR’s office space, and SIGPR continues to work with
Treasury to secure items such as laptops, monitors, and mobile phones for each new hire as
part of the fee-for-service cost structure imposed across all of Treasury’s bureaus. To save

16 See CARES Act § 4018(g)(1)-(2).

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valuable funds, SIGPR has opted to use mobile phones instead of installing an additional VOIP
or landline system. Treasury’s IT help desk has provided able assistance to SIGPR by responding
to many requests for IT support.
Staffing Update
The hiring process continues to pose challenges, but SIGPR remains steadfast in recruiting
highly qualified and talented staff with the knowledge, skills, and abilities to support its critical
oversight mission. As of December 31, 2020, SIGPR had 24 full-time equivalent (FTE) employees
on board and three detailees. By the end of January, SIGPR on boarded 34 FTE, and by
September 30, 2021, SIGPR is projected to have 66 FTE.

Building Partnerships
SIGPR continues to build partnerships to strategically leverage resources and capabilities in
support of lead-development, audits, investigations, and case referrals. In addition to its
partnerships with FinCEN and the SEC, SIGPR has MOUs with 11 United States Attorney’s
Offices. The office also continues to strengthen relationships with other law enforcement
entities and fellow IGs. SIGPR is especially grateful to the Federal Reserve OIG, which has been
a critical partner, graciously offering collaboration, assistance, and support.
During this reporting period, SIGPR entered an agreement with the Federal Trade Commission
(FTC) to access the FTC’s Consumer Sentinel Network, which holds information from more than
45 contributing entities, including federal agencies, state Attorneys General, the Better
Business Bureau, Microsoft’s Cyber Crime Center, Western Union, and Money Gram, as well as
consumer complaints. SIGPR has also partnered with an informal collaboration of federal, state,
and local law enforcement and financial institutions, facilitating a deeper relationship with
financial institutions’ respective anti-money laundering units.
In addition, SIGPR is collaborating with entities within Treasury. SIGPR and Treasury’s Enterprise
Data Management team are currently focused on project planning, requirements definition,
dataset identification, and data enrichment in the following three core work streams: data
management, data analytics, and data visualization. SIGPR is also working with Treasury’s Do
Not Pay Business Center to identify potential transactions at high risk of fraud, waste, and
abuse, including eligibility and improper payment issues.
In its continued effort to develop partnerships and ensure deconfliction, in addition to efforts
discussed above, SIGPR participates in the following:
• Treasury’s Chief Data Officers Community Committee;
• CIGIE’s Data Analytics Working Group and Whistleblower Coordinator Working Group;
• PRAC’s Training Subcommittee, Law Enforcement Coordination Subcommittee, and Data
Sharing and Resources work groups;
• That Inter-OIG Pandemic Multi-Dipping Work Group; and
• The Pandemic Oversight Website Committee.

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SIGPR’s early focus on building partnerships has allowed SIGPR—a brand new agency looking to
build cases with existing federal agencies and OIGs—to thoughtfully develop front-end
investigative strategies that facilitate efficient lead-development, with an eye toward
developing investigations that SIGPR will later refer to U.S. Attorney’s Offices. In fact, SIGPR is
currently working with three U.S. Attorney’s Offices on investigations, two of which were
generated by SIGPR’s proactive efforts.
One specific example of success on this front has been SIGPR’s relationship with the Federal
Reserve OIG and the Federal Reserve Board’s Office of General Counsel—a productive working
relationship that itself was facilitated by SIGPR’s relationship with the Federal Reserve IG and
his team. As SIGPR identifies and reviews suspicious transactions within the handful of Section
13(3) facilities under SIGPR’s jurisdiction, the offices have developed a process for obtaining
documents and information relating to such transactions through formal requests. This process
has proven effective and, in SIGPR’s view, is an example of successfully leveraging partnerships
to further both oversight and government efficiency. As a result of this process, SIGPR is often
able to obtain critical information without issuing subpoenas. This also means SIGPR is
frequently able to obtain such information more quickly than would be the case with
subpoenas.
Finally, SIGPR’s emphasis on partnerships also includes serving as a good steward of
investigative leads that, while perhaps not implicating programs under SIGPR’s jurisdiction, may
be reviewed and developed by other agencies and offices of inspector general. To date, SIGPR
has referred more than 76 investigative leads to its law-enforcement partners, including fellow
inspectors general.

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SIGPR FINDINGS AND
REPORTABLE DEVELOPMENTS

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The CARES Act requires SIGPR to include in its regular reports to Congress “a detailed statement
of all loans, loan guarantees, other transactions, obligations, expenditures, and revenues
associated with any program established by the Secretary under Section 4003, as well as the
information collected under subsection (c)(1).”17 Accordingly, below are the categories of loans
and other investments18 made by the Secretary under CARES Act § 4003, including, where
applicable and known, a list of the loans and investments made under each category and the
eligible businesses to which loans were made. In addition, a short section below also describes
three letters SIGPR sent to Treasury as part of its oversight activities relating to developments
publicly reported.
Direct Loans and Other Investments
Introduction
Passed as part of the CARES Act in March 2020, Section 4003(a) authorized the Secretary “to
make loans, loan guarantees, and other investments in support of eligible businesses, States,
and municipalities that do not, in the aggregate, exceed $500,000,000,000.” The CARES Act
further categorized these loans and investments into four areas. The first three, codified in
Sections 4003(b)(1)–(3), cover loans and loan guarantees to passenger air carriers and related
businesses ($25 billion), cargo air carriers ($4 billion), and businesses critical to maintaining
national security ($17 billion).19 The fourth area, codified in Section 4003(b)(4), authorized the
Secretary to invest in the Federal Reserve’s various liquidity programs established under
Section 13(3) of the Federal Reserve Act ($454 billion). On December 27, 2020, the
Consolidated Appropriations Act, 2021, amended the CARES Act to rescind unobligated
balances of funds ($429 million) in these programs.20 It also specified that after December 31,
2020, the Federal Reserve “shall not make any loan, purchase any obligation, asset, security, or
other interest, or make any extension of credit” through the liquidity programs or facilities in
which Treasury had invested CARES Act appropriated-money, except for facilities in the Main
Street Lending Program, discussed further below, that were authorized to purchase loans until
January 8, 2021 for applications submitted by December 14, 2020.21
An overview of the relevant categories and amounts of Treasury’s obligations under CARES Act
§ 4003(b)(1)-(4) through December 31 is reflected in the following table:

17 CARES Act § 4018(f)(1)(B).
18 Treasury has not established a program for “loan guarantees” under CARES Act § 4003.
19 Treasury has posted on its website the contracts it has entered into in connection with the administration of loans under
Section 4003(b)(1), (2), and (3). See Other Program, U.S. Dep’t Treasury (last visited Jan. 4, 2021),
https://home.treasury.gov/data/other-programs.
20 See Consolidated Appropriations Act, 2021, Public Law 116-260, Division N §§ 1003, 1005.
21 Id., § 1005.

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Funding Program
Obligation Amount
Direct Loans to Passenger Air Carriers
and Related Businesses
$21,152,937,504
Direct Loans to Cargo Air Carriers
$2,111,656
Direct Loans to Businesses Critical to
Maintaining National Security
$735,934,400
Main Street Lending Program (MS
Facilities, LLC)
$37,512,126,522
Term Asset-Backed Securities Facility
(TALF II, LLC)
$10,000,000,000
Primary and Secondary Market
Corporate Credit Facility (Corporate
Credit Facilities, LLC)
$37,513,567,436
Municipal Liquidity Facility
(Municipal Liquidity Facility, LLC)
$17,500,000,000
Direct Loans
On March 30, 2020, Treasury first announced guidelines for businesses interested in applying
for loans under CARES Act § 4003(b)(1)-(3).22 Those guidelines incorporated several mandatory
loan terms and conditions, with many designed to protect American taxpayers. Before making
each loan, Treasury was required to determine, or the borrower must have agreed to, the
following:
• Unavailable Credit Elsewhere. Credit is not otherwise “reasonably available” for the
borrower at the time of the loan, § 4003(c)(2)(A);
• Prudent Borrowing. The loan is being “prudently incurred” by the borrower, § 4003(c)(2)(B);
• Sufficient Security or Rate. The loan is “sufficiently secured” or “made at a rate” that both
“reflects the risk of the loan” and, “to the extent practicable, not less than an interest rate
based on market conditions for comparable obligations prevalent prior to the outbreak” of
COVID-19, § 4003(c)(2)(C);
• Term. The term of the loan must be “as short as practicable and in any case not longer than
5 years,” § 4003(c)(2)(D);
• No Purchases of Borrower’s Stock. Until a date 12 months after the loan has been repaid,
neither the borrower nor any affiliated person or business may purchase the borrower’s (or
any parent company’s) stock that is listed on a national securities exchange, unless required
by a preexisting contractual obligation, § 4003(c)(2)(E);
• No Dividends. Until a date 12 months after the loan has been repaid, the borrower may not
pay a dividend or other capital distribution on its common stock, § 4003(c)(2)(F);

22 Procedures and Minimum Requirements for Loans to Air Carriers and Eligible Businesses and National Security Businesses
under Division A, Title IV, Subtitle A of the Coronavirus Aid, Relief, and Economic Security Act, U.S. Dep’t Treasury (Mar. 30,
2020), https://home.treasury.gov/system/files/136/Procedures%20and%20Minimum%20Requirements%20for%20Loans.pdf.

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• Maintain Employment Levels. The borrower, until September 30, 2020, “shall maintain its
employment levels as of March 24, 2020, to the extent practicable, and in any case shall not
reduce its employment levels by more than 10 percent of the levels on such date,”
§ 4003(c)(2)(G);
• U.S. Business. The borrower certifies “that it is created or organized in the United States or
under the laws of the United States and has significant operations in and a majority of its
employees based in the United States,” § 4003(c)(2)(H);
• Covered Losses. The borrower “must have incurred or is expected to incur covered losses
such that the continued operations of the business are jeopardized, as determined by the
Secretary,” § 4003(c)(2)(I);
• Equity Interest or Senior Debt Provided to the Government. Treasury must “receive a
warrant or equity interest” in the borrower if the borrower “has issued securities that are
traded on a national securities exchange,” otherwise, Treasury must “receive a warrant or
equity interest” in the borrower or “a senior debt instrument” from the borrower. Issuance
of the warrant, equity, or debt “shall be designed to provide for a reasonable participation
by the Secretary, for the benefit of taxpayers, in equity appreciation in the case of a warrant
or other equity interest, or a reasonable interest rate premium, in the case of a debt
instrument,” § 4003(d)(1)–(2);
• No Loan Forgiveness. The principal amount of any loan cannot be reduced through loan
forgiveness, § 4003(d)(3);
• Limitation on Employee Compensation. CARES Act § 4004 requires a borrower to limit
compensation for certain employees during the period beginning on the date the loan
agreement is executed and ending one year after the loan is repaid, as follows:
o No officer or employee of the borrower “whose total compensation exceeded
$425,000 in calendar year 2019,” may receive annual “total compensation which
exceeds” the amount the officer or employee received in calendar year 2019, and
such officer or employee shall not receive “severance pay or other benefits upon
termination of employment” with the borrower “which exceeds twice the maximum
total compensation received by the officer or employee from the eligible business in
calendar year 2019;”
o No officer or employee of the borrower “whose total compensation exceeded
$3,000,000 in calendar year 2019,” may receive “total compensation in excess of the
sum of . . . $3,000,000” and “50 percent of the excess over $3,000,000 of the total
compensation received by the officer or employee from the eligible business in
calendar year 2019.”
• Continuation of Air Service. If the borrower is an air carrier, it must maintain scheduled air
services deemed necessary by the Secretary of Transportation to ensure service to any
location served by the borrower before March 1, 2020, § 4005; and

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• Conflicts of Interest. Direct loans, like all transactions described in CARES Act § 4003, may
not be made to “covered entities” under the CARES Act’s conflict of interest provision in
Section 4019. The provision defines a “covered entity” as one where the President, Vice
President, head of an Executive Department, member of Congress, or certain family
members hold 20% or more of any class of equity interest in the entity receiving the loan or
involved in the Section 4003 transaction.
On April 14, 2020, Treasury entered into an agreement with The Bank of New York Mellon
(BNYM) to perform custodian and infrastructure services, and to act as a financial agent, in
connection with Treasury’s loans under Section 4003(b)(1)–(3).23 It has managed risk and
exercised oversight of these loans through the following means:24
• Adherence to an underwriting guide that defines a credit review process, involving key
elements of the underwriting, credit analysis, and approval process, including legal and
financial due diligence. More specifically, in accordance with the advice of financial and
legal advisors, Treasury follows a process to consider loan applications that included the
following: (a) designing and applying credit standards that were uniformly applied to all
loan applicants; (b) conducting due diligence on loan applications; and (c) forming credit
committees that consisted of senior Treasury officials to consider each potential loan.
• Treasury also exercised oversight of loans made under Section 4003(b)(1)–(3) by
monitoring submissions and communications from the debtor, including between the
debtor and BNYM; monitoring public borrowers’ filings with the Securities and Exchange
Commission; engaging directly with borrowers as appropriate; and monitoring other
relevant public sources of information.
Air Carrier Loan Program
Passed as part of the CARES Act in March 2020, Section 4003(b)(1)–(2) allocated $25 billion for
loans and loan guarantees to passenger air carriers, aviation-maintenance facilities certified
under 14 C.F.R. Part 145, and air-transportation ticket agents, as well as $4 billion for cargo air
carriers.
The following table summarizes the Section 4003(b)(1)-(2) loans as of January 4, 2021.25

23 Financial Agency Agreement for Custodian and Infrastructure Services for Programs Under the
Coronavirus Aid, Relief, and Economic Security Act, https://home.treasury.gov/system/files/136/BNY-Mellon-Custodian-FAA-
for-CARES-Act-Custodian-EXECUTED-04-14-2020.pdf.
24 At SIGPR’s request, Treasury provided SIGPR access to nonpublic information on applicants to Treasury’s loan programs under
Section 4003. SIGPR’s review of this nonpublic information revealed several application rejections and withdrawals that SIGPR
may review further to identify any patterns of conduct that may indicate fraudulent or other illicit activity on the part of
program applicants and participants.
25 Loans to Air Carriers, Eligible Businesses, and National Security Businesses, U.S. Dep’t Treasury (Last visited January 8, 2021),
https://home.treasury.gov/policy-issues/cares/preserving-jobs-for-american-industry/loans-to-air-carriers-eligible-businesses-
and-national-security-businesses.

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27
Recipient
Loan Date
Maturity
Date
Total
Anticipated
Loan Amount
Disbursements26
Total
Outstanding
Loan Amount27
Cash
Interest
Receipts
Aero Hydraulics,
Inc.
10/26/2020
10/24/2025
$450,000
$450,000
$455,751
$0
Alaska Airlines,
Inc..
9/28/2020
(amended
10/30/2020)
9/26/2025
$1,928,000,000
$135,000,000
$135,000,000
$0
Allflight
Corporation
11/5/2020
11/5/2025
$4,721,260
$4,721,260
$4,721,260
$22,948
American Airlines,
Inc.
9/26/2020
(amended
10/21/2020)
6/30/2025
$7,500,000,000
$550,000,000
$550,000,000
$0
American Jet
International Corp
11/5/2020
11/5/2025
$1,162,124
$1,162,124
$1,162,124
$6,300
Aviation
Management &
Repairs, Inc.
11/5/2020
11/5/2025
$4,026,705
$4,026,705
$4,048,535
$0
Bristin Travel, LLC
10/26/2020
10/24/2025
$549,651
$549,651
$554,773
$0
Caribbean Sun
Airlines, Inc.
11/5/2020
(amended
12/7/2020)
11/5/2025
$6,768,749
$6,768,749
$6,778,872
$0
Eastern Airlines,
LLC
10/28/2020
10/28/2025
$15,000,000
$15,000,000
$15,134,400
$0
Elite Airways, LLC
11/9/2020
(amended
12/1/2020)
11/7/2025
$2,630,274
$2,630,274
$2,637,158
$0
Frontier Airlines,
Inc.
9/28/2020
9/26/2025
$574,000,000
$150,000,000
$150,000,000
$0
Hawaiian Airlines,
Inc.
9/25/2020
(amended
10/23/2020)
6/28/2024
$622,000,000
$45,000,000
$45,000,000
$0
Island Wings, Inc.
11/5/2020
11/5/2025
$294,350
$294,350
$295,781
$0
Jetblue Airways
Corporation
9/29/2020
(amended
11/3/2020)
11/29/2025
$1,948,000,000
$115,000,000
$115,000,000
$0
Legacy Airways,
LLC
10/20/2020
10/25/2025
$1,817,306
$1,817,306
$1,841,844
$0
Mesa Airlines, Inc.
10/30/2020
10/30/2025
$195,000,000
$195,000,000
$195,705,106
$0
Ovation Travel
Group, Inc.
10/15/2020
10/15/2025
$20,000,000
$20,000,000
$20,294,156
$0
Republic Airways,
Inc.
11/6/2020
11/6/2025
$58,000,000
$58,000,000
$58,000,000
$30,047
Skywest Airlines,
Inc.
9/29/2020
(amended
10/28/2020)
9/29/2025
$725,000,000
$60,000,000
$60,000,000
$0
Southern Airways
Express, LLC
10/28/2020
10/28/2025
$1,838,501
$1,838,501
$1,838,501
$16,473
Sun Country, Inc.
10/26/2020
10/24/2025
$45,000,000
$45,000,000
$45,419,375
$0
Thomas Global
Systems, LLC
11/9/2020
11/7/2025
$1,400,000
$1,400,000
$1,407,590
$0

26 “Disbursements” includes all loan disbursements.
27 “Total Outstanding Loan Amount” includes all loan disbursements and increases of loan principal amount arising from
payment-in-kind (PIK) interest, less any repayments of principal.

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Recipient
Loan Date
Maturity
Date
Total
Anticipated
Loan Amount
Disbursements26
Total
Outstanding
Loan Amount27
Cash
Interest
Receipts
Timco Engine
Center, Inc.
11/5/2020
11/5/2025
$8,390,240
$8,390,240
$8,435,727
$0
United Airlines,
Inc.
9/28/2020
(amended
11/6/2020
and
12/8/2020)
9/26/2025
$7,491,000,000
$520,000,000
$520,000,000
$0

Businesses Critical to National Security
Passed as part of the CARES Act in March 2020, Section 4003(b)(3) allocated $17 billion for
loans and loan guarantees to “businesses critical to maintaining national security.” The CARES
Act does not define the term “businesses critical to maintaining national security,” but Treasury
established criteria for making this determination in its Frequently Asked Questions guidance
issued on April 10, 2020:
A business critical to maintaining national security is one that, unless otherwise
approved as set forth below, is at the time of the business’s application:
(1) performing under a “DX”-priority rated contract or order under the
Defense Priorities and Allocations System regulations (15 C.F.R. part 700);
or
(2) operating under a valid Top Secret facility security clearance under
the National Industrial Security Program regulations (32 C.F.R. part 2004).
Applicants that do not satisfy either of these two criteria may be considered for
loans if, based on a recommendation and certification by the Secretary of
Defense or the Director of National Intelligence that the applicant business is
critical to maintaining national security, the Secretary of the Treasury determines
that the applicant business is critical to maintaining national security.28
The following table summarizes the Section 4003(b)(3) loans as of January 4, 2021.

Recipient
Loan
Date
Maturity
Date
Total
Anticipated
Loan Amount
Disbursements29
Total
Outstanding
Loan Amount30
Cash
Interest
Receipts
Channel Logistics,
LLC
11/12/2020
11/12/2025
$2,500,000
$2,500,000
$2,500,000
$15,400
Core Avionics &
Industrial, Inc.
11/5/2020
11/5/2025
$6,000,000
$6,000,000
$6,000,000
$58,133
Map Large, Inc.
11/2/2020
10/31/2025
$10,000,000
$10,000,000
$10,104,036
$0

28 Q&A: Loans to Air Carriers and Eligible Businesses and National Security Businesses, U.S. Dep’t Treasury, at 1 (Apr. 10, 2020),
https://home.treasury.gov/system/files/136/CARES-Airline-Loan-Support-Q-and-A-national-security.pdf.
29 “Disbursements” includes all loan disbursements.
30 “Total Outstanding Loan Amount” includes all loan disbursements and increases of loan principal amount arising from
payment-in-kind (PIK) interest, less any repayments of principal.

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Recipient
Loan
Date
Maturity
Date
Total
Anticipated
Loan Amount
Disbursements29
Total
Outstanding
Loan Amount30
Cash
Interest
Receipts
Meridian Rapid
Defense Group, LLC
10/30/2020
10/30/2025
$7,100,000
$7,100,000
$7,100,000
$79,019
Ovio Technologies,
Inc.
11/2/2020
10/31/2025
$1,186,900
$1,186,900
$1,199,248
$0
Semahtronix, LLC
11/13/2020
11/13/2025
$1,999,100
$1,999,100
$2,009,175
$0
Semantic AI, Inc.
11/13/2020
11/13/2025
$506,300
$506,300
$509,324
$0
SpinLaunch, Inc.
11/13/2020
11/13/2025
$2,519,200
$2,519,200
$2,519,200
$12,697
Visual Semantics,
Inc.
10/30/2020
10/30/2025
$1,053,200
$1,053,200
$1,053,200
$11,722
Wiser Imagery
Services, LLC
10/30/2020
10/30/2025
$3,069,700
$3,069,700
$3,103,864
$0
YRC Worldwide Inc.
7/8/2020
9/30/2024
$700,000,000
$551,300,000
$553,594,683
$1,437,191
Other Investments
Passed as part of the CARES Act in March 2020, Section 4004(b)(4) allocated at least $454
billion for “loans and loan guarantees to, and other investments in, programs or facilities
established by the Board of Governors of the Federal Reserve System for the purpose of
providing liquidity to the financial system that supports lending to eligible businesses, States, or
municipalities” by “purchasing obligations or other interests” directly from the issuer or
through secondary markets, and “making loans, including loans or other advances secured by
collateral.”
The Federal Reserve established several liquidity programs (Federal Reserve facilities),
described in detail below, using its emergency lending powers under Section 13(3) of the
Federal Reserve Act, codified at 12 U.S.C. § 343(3). That provision, used extensively during the
2008 financial crises and amended by the Dodd-Frank Wall Street Reform and Consumer
Protection Act, Pub. L. 111-203, 124 Stat. 1375, allows the Federal Reserve to lend money in
“unusual and exigent circumstances” to participants in “any program or facility with broad-
based eligibility” who are “unable to secure adequate credit accommodations from other
banking institutions.” The Federal Reserve, however, may not lend to insolvent entities, and its
programs must be approved by the Secretary of the Treasury.
On November 30, 2020, Federal Reserve Chair Jerome H. Powell agreed to return Treasury's
unobligated CARES Act funds in the Federal Reserve facilities31 after receiving a request from
then-Secretary of the Treasury Steven Mnuchin.32 According to a letter sent from Treasury to
SIGPR on January 19, 2021, any concerns that the CARES Act did not require the discontinuation
of these Federal Reserve facilities was rendered moot33 following enactment of the
Consolidated Appropriations Act, 2021, which as noted earlier in the report, rescinded

31 Letter from Chair Jerome H. Powell to then-Secretary Steven Mnuchin regarding emergency lending facilities (Nov. 20, 2020),
https://www.federalreserve.gov/foia/files/mnuchin-letter-20201120.pdf.
32 Letter from then-Secretary Steven Mnuchin to Chair Jerome H. Powell on the Status of Facilities Authorized Under Section
13(3) of the Federal Reserve Act (Nov. 19, 2020), https://home.treasury.gov/system/files/136/letter11192020.pdf.
33 Letter from J. Stern, the Department of Treasury, Office of General Counsel, to Brian Miller, SIGPR (Jan. 19. 2021).

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unobligated CARES Act funds for the Federal Reserve facilities, and terminated the Federal
Reserve’s authority to make new loans, asset purchases, or modifications through them.34 This
letter was transmitted to SIGPR by the previous administration on its final day, and it does not
necessarily reflect the views of the current administration.
Before the Consolidated Appropriations Act, 2021, Treasury had invested $102.5 billion of
CARES Act funds to support the Federal Reserve facilities. These included the Main Street
Lending Program, the Primary and Secondary Corporate Credit Facilities, the Municipal Liquidity
Facility, and the Term Asset-Backed Securities Loan Facility. For each program, Treasury
invested in a limited liability company, known as a special purpose vehicle (SPV), which
purchased specified assets or made loans to borrowers and is managed by one of the individual
Federal Reserve Banks.
Treasury held 99.9% equity in the Federal Reserve SPVs, and its investment of CARES Act funds
into them was intended to protect the Federal Reserve from losses. For each SPV into which the
Secretary invested, the Secretary entered a formal “Investment Memorandum of
Understanding” and was party to an appropriate Limited Liability Company Agreement.35
The Federal Reserve Bank responsible for a given facility lent each SPV funds to be used in
specific transactions that supported market liquidity. When structuring a given facility, the
Secretary and the Federal Reserve had decided on a “gearing ratio” of Federal Reserve lending
to Treasury loss-absorbing capital. For each facility, application of the gearing ratio to the
amount invested by the Secretary thus reflected the agencies’ calculation of the amount of
lending the facility could support without a likelihood of capital losses beyond the amount
invested by the Secretary. The basic functioning of this “gearing ratio” is explained in the
agencies’ responses to questions from the Congressional Oversight Commission, which are
disclosed in that commission’s July 20, 2020 report.36
On its website, the Federal Reserve Board provides extensive information about its SPVs and
facilities, including detailed terms and conditions for loans and other transactions. The Federal
Reserve Board also provides detailed information about each transaction in spreadsheet form
so that one can evaluate the individual loans made by a Section 13(3) facility’s SPV.37 The

34 See supra at 23, nn. 20-21.
35 See Main Street Lending Program Facility Agreements, Federal Reserve Bank of Boston,
https://www.bostonfed.org/supervision-and-regulation/supervision/special-facilities/main-street-lending-program/facility-
agreements.aspx; Term Asset-Backed Securities Loan Facility, Federal Reserve Bank of New York ,
https://www.newyorkfed.org/markets/term-asset-backed-securities-loan-facility; Municipal Liquidity Facility, Federal Reserve
Bank of New York (last visited Sept. 27, 2020), https://www.newyorkfed.org/markets/municipal-liquidity-facility; Secondary
Market Corporate Credit Facility, Federal Reserve Bank of New York , https://www.newyorkfed.org/markets/secondary-market-
corporate-credit-facility (this MOU relates to both the Secondary Corporate Credit Facility and the Primary Market Corporate
Credit Facility).
36 The Third Report of the Congressional Oversight Commission, Treasury and Federal Reserve Answers to Tier 2 Questions, at 3
(July 20, 2020), https://coc.senate.gov/sites/default/files/2020-
08/20200720_Congressional_Oversight_Commission_3rd_Report.pdf.
37 See, e.g., TALF Transaction-specific Disclosures, dated December 11, 2020, at
https://www.federalreserve.gov/monetarypolicy/talf.htm; Main Street Facilities Transaction-specific Disclosures, dated January
8, 2021, at https://www.federalreserve.gov/monetarypolicy/mainstreetlending.htm; Secondary Market Corporate Credit
Facility Transaction-specific Disclosures, dated December 11, 2020, at

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Federal Reserve regularly updates this information and posts it under the “Policy Tools” section
of its website.38
The following table summarizes the total amount of CARES Act funds Treasury had originally
indicated it would invest in the SPVs.39
Recipient
Maximum Intended Treasury
Investment
Corporate Credit Facilities, LLC
$75,000,000,000
Municipal Liquidity Facility, LLC
$35,000,000,000
TALF II, LLC
$10,000,000,000
MS Facilities, LLC
$75,000,000,000

The following table summarizes the total amount of CARES Act funds that Treasury invested in
each SPV as of December 31, 2020.40
Recipient
Treasury Investment as of December
31, 2020
Corporate Credit Facilities, LLC
$37,515,069,773
Municipal Liquidity Facility, LLC
$17,500,000,000
TALF II, LLC
$10,000,000,000
MS Facilities, LLC
$37,513,628,791

The following table summarizes the portfolio holdings of the facilities as of the December 31,
2020 release of the Federal Reserve’s balance sheet.41
Facility
Outstanding Amount
of Purchased Loan
Participations, Notes,
and Other Securities
Treasury Contributions
and Other Assets
Total
Corporate Credit Facilities, LLC
$14,315,000,000
$32,217,000,000
$46,532,000,000
Municipal Liquidity Facility, LLC
$6,283,000,000
$14,995,000,000
$21,278,000,000
TALF II, LLC
$3,552,000,000
$9,112,000,000
$12,664,000,000
MS Facilities, LLC
$16,385,000,000
$37,688,000,000
$54,073,000,000

The following paragraphs describe the functioning of these facilities, which have terminated.

https://www.federalreserve.gov/monetarypolicy/smccf.htm; Municipal Liquidity Facility Transaction-specific Disclosures, dated
December 11, 2020, at https://www.federalreserve.gov/monetarypolicy/muni.htm.
38 Policy Tools, Board of Governors of the Federal Reserve System,
https://www.federalreserve.gov/monetarypolicy/policytools.htm.
39 The amounts listed are taken from the term sheets cited in the facility discussions below.
40 See Periodic Report: Update on Outstanding Lending Facilities Authorized by the Board under Section 13(3) of the Federal
Reserve Act (Jan. 11, 2021), https://www.federalreserve.gov/publications/files/pdcf-mmlf-cpff-pmccf-smccf-talf-mlf-ppplf-
msnlf-mself-msplf-nonlf-noelf-01-11-21.pdf
41 See Federal Reserve Statistical Release, H.4.1, Factors Affecting Reserve Balances,
https://www.federalreserve.gov/releases/H41/.

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Corporate Credit Facilities, LLC
Corporate Credit Facilities, LLC, was formed by the Federal Reserve Bank of New York on April
31, 2020, to operate the Primary Market Corporate Credit Facility (PMCCF) and the Secondary
Market Corporate Credit Facility (SMCCF). The facilities were structured to purchase up to $750
billion in debt securities under these programs. Treasury originally indicated it would invest up
to $50 billion to support the PMCCF and $25 billion to support the SMCCF;42 Treasury invested
$37.5 billion in the facilities.43
The PMCCF was intended to purchase corporate bonds as the sole investor in a bond issuance.
The facility was also able to purchase syndicated loans or bonds at issuance. The bonds and
loans must have had a maturity of four years or less, and the facility was limited to purchasing
25% of any syndicated loan or bond. To be eligible for the program, an issuer must have had an
investment-grade credit rating as of March 22, 2020. The facility ceased purchasing securities
on December 31, 2020. As of December 31, 2020, the PMCCF did not close any transactions.44
The SMCCF was authorized to purchase the following debt securities on the secondary market:
• Individual corporate bonds having a remaining maturity of five years or less that were
issued by businesses with investment-grade credit ratings as of March 22, 2020;
• Corporate bond exchange-traded funds (ETFs) whose objective is to provide broad
exposure to the U.S. corporate bond market, including exposure to both investment-
grade and high-yield bonds; and
• Individual corporate bonds with a remaining maturity of five years or less that would
create a bond portfolio reflecting a broad market index of the U.S. corporate bond
market.
The facility ceased purchasing securities on December 31, 2020. Detailed transaction
information for the SMCCF’s purchases is available on the Federal Reserve’s website.45
Municipal Liquidity Facility, LLC
Municipal Liquidity Facility, LLC, was formed by the Federal Reserve Bank of New York on May
1, 2020, to operate the Municipal Liquidity Facility (MLF). The facility was structured to offer up
to $500 billion to support state and local governments and related entities. Treasury originally
indicated it would invest up to $35 billion to support the Municipal Liquidity Facility;46 Treasury
invested $17.5 billion in the facility.47
The facility was able to purchase various revenue, tax, and bond anticipation notes issued by
states, the District of Columbia, large cities and counties, multi-state entities, and revenue bond

42 Term Sheet, Primary Market Corporate Credit Facility (July 28, 2020),
https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20200728a9.pdf.
43 Periodic Report, supra note 40.
44 See Periodic Report, supra note 40.
45 Secondary Market Corporate Credit Facility, Board of Governors of the Federal Reserve System (last visited Jan. 11, 2020),
https://www.federalreserve.gov/monetarypolicy/smccf.htm.
46 Term Sheet, Municipal Liquidity Facility, Board of Governors of the Federal Reserve System (Aug. 11, 2020),
https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20200811a1.pdf.
47 Periodic Report, supra note 40.

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issuers. The notes must have matured within three years of issuance, and the issuing entity
generally must have had an investment-grade credit rating at the time of issuance. Issuers were
required to use the proceeds of the notes to alleviate cash flow problems resulting from
reduced tax revenue, increased expenses, or similar financial problems related to the COVID-19
pandemic. The facility ceased purchasing notes on December 31, 2020.48 Transaction-specific
details for the MLF are available on the Federal Reserve’s website.49
As of December 31, 2020, the Federal Reserve reported four transactions for the MLF. They are
described in the following table.
Issuer Name
Closing Date
Value of note
[$ value]
Current
outstanding
amount of note
Maturity date
of note
Interest
rate
State of Illinois
6/5/2020
$1,200,000,000
$925,000,000.
6/5/2021
3.36%
State of Illinois
12/17/2020
$2,000,000,000
$2,000,000,000
12/15/2023
3.42%
Metropolitan Transportation
Authority (NY)
8/26/2020
$450,720,000
$450,720,000
8/1/2023
1.93%
Metropolitan Transportation
Authority (NY)
12/17/2020
$2,907,280,000
$2,907,280,000
12/15/2023
1.33%

TALF II, LLC
TALF II, LLC, was formed by the Federal Reserve Bank of New York on April 13, 2020, to operate
the Term Asset-Backed Securities Loan Facility, or TALF. (The original TALF, LLC, was established
during the 2008 financial crisis). Treasury originally intended to and did invest $10 billion in the
facility.50 The facility was structured to offer up to $100 billion in TALF lending.
TALF II, LLC, made three-year, nonrecourse loans to borrowers who issued asset-backed
securities to serve as collateral for the loans. An asset-backed security is one composed of a
pool of debt obligations. The security’s value and performance depend on the value and
performance of the underlying pool of debt. Asset-backed securities that were eligible to serve
as collateral for a TALF loan included asset-backed securities based on auto loans and leases,
student loans, credit card receivables, floorplan loans, commercial mortgages, collateralized
loan obligations, and other common credit arrangements. TALF accepted as collateral only
those asset-backed securities with the highest investment-grade rating.51
TALF stopped making loans on December 31, 2020. Transaction-specific details for the TALF are
available on the Federal Reserve’s website.52

48 See Term Sheet, Municipal Liquidity, supra note 47.
49 Policy Tools, Municipal Liquidity Facility, Board of Governors of the Federal Reserve System,
https://www.federalreserve.gov/monetarypolicy/muni.htm.
50 Periodic Report, supra note 40.
51 See Term Sheet, Term Asset-Backed Securities Loan Facility, Board of Governors of the Federal Reserve System (July 28,
2020), https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20200728a6.pdf.
52 Policy Tools, Term Asset-Backed Loan Facility, Board of Governors of the Federal Reserve System,
https://www.federalreserve.gov/monetarypolicy/talf.htm.

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MS Facilities, LLC
MS Facilities, LLC, was formed by the Federal Reserve Bank of Boston on May 18, 2020, to
operate the Federal Reserve’s various facilities under the Main Street Lending Program (MSLP).
The Main Street Lending Program was structured to offer up to $600 billion in lending. Treasury
originally indicated it would invest up to $75 billion to support the MSLP;53 Treasury invested
$37.5 billion in the program’s single common SPV.54
The MSLP supported private lending to medium-sized and small businesses by purchasing 95%
participations in loans that conformed to the terms of an MSLP program. The private lender
retains a 5% participation in the loan. Loans may be secured or unsecured. The Federal Reserve
Bank of Boston has published the following graphic showing the operation of the MSLP.55

Transaction-specific details for the MSLP are available on the Federal Reserve’s website and
updated regularly.56
The Consolidated Appropriations Act, 2021, clarified that the Federal Reserve facilities in which
Treasury had made investments of CARES Act funds could make no loans or purchase
obligations after December 31, 2020, and rescinded unobligated funds. However, Congress
permitted the five Main Street facilities to purchase loan participations until January 8, 2021 for

53 Term Sheet, Main Street New Loan Facility, Board of Governors of the Federal Reserve System (July 28, 2020),
https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20200728a3.pdf.
54 Periodic Report, supra note 40.
55 The Federal Reserve’s Main Street Lending Program, Federal Reserve Bank of Boston,
https://www.bostonfed.org/supervision-and-regulation/supervision/special-facilities/main-street-lending-program/main-
street-lending-program-overview.aspx.
56 Policy Tools, Main Street Lending Program, Board of Governors of the Federal Reserve System,
https://www.federalreserve.gov/monetarypolicy/mainstreetlending.htm.

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applications submitted by December 14, 2020.57 Authority for the MSLP then terminated.
Additional terms for each program applied as follows.
Loans to for-profit businesses
The MSLP offered three loan programs to for-profit business: the Main Street New Loan Facility
(MSNLF), Main Street Priority Loan Facility (MSPLF), and Main Street Expanded Loan Facility
(MSELF). Each program had the following basic terms:

The MSNLF and MSPLF differed in the size of loans available and in additional terms to
compensate for the greater exposure to loss in the larger MSPLF loans. Both programs offered
new loans, as opposed to expanding existing ones such as the third facility did, discussed below.
From October 30, 2020 on, the MSNLF and the MSPLF had a minimum loan amount of
$100,000.58
The maximum MSNLF loan was the lesser of $35 million or an amount that would not cause the
borrower’s total outstanding and undrawn debt to exceed four times the borrower’s 2019
earnings before adjusted interest, taxes, depreciation, and amortization (EBITDA). The new loan
needed not be senior to the borrower’s other debt, but it could not be contractually
subordinated to the borrower’s other debt.59
The maximum MSPLF loan was the lesser of either $50 million or an amount that would not
cause the borrower’s total outstanding and undrawn debt to exceed six times the borrower’s
2019 adjusted EBITDA. The MSPLF compensated for the higher loan amount by requiring the
loan to be either pari-passu (on equal footing) or senior in priority to the borrower’s other
debts, except for mortgage debt. Unlike MSNLF loans, MSPLF loans had some level of
repayment preference among the borrower’s various debts in the event the borrower became
insolvent.60

57 Consolidated Appropriations Act, 2021, §§ 1003, 1005.
58 The minimum loan amount for MSNLF and the MSPLF was decreased from $250,000 to $100,000 on October 30, 2020 (See
Federal Reserve Board press release (Oct. 30, 2020)),
https://www.federalreserve.gov/newsevents/pressreleases/monetary20201030a.htm; see also Periodic Report: Update on
Outstanding Lending Facilities Authorized by the Board under Section 13(3) of the Federal Reserve Act (Nov. 6, 2020),
https://www.federalreserve.gov/publications/files/pdcf-mmlf-cpff-pmccf-smccf-talf-mlf-ppplf-msnlf-mself-msplf-nonlf-noelf-
11-9-20.pdf#page=7
59 See Term Sheet, Main Street New Loan Facility, Board of Governors of the Federal Reserve System (Dec. 29, 2020),
https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20201229a1.pdf
60 See Term Sheet, Main Street Priority Loan Facility, Board of Governors of the Federal Reserve System (Dec. 29, 2020),
https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20201229a2.pdf
Loan Term
Five years
Employees and Revenue
Either 15,000 or fewer employees, or 2019 revenue of $5 billion or less
Rate
Adjustable Rate of LIBOR (one month or three months) plus 3%
Interest Deferral
Deferred for one year
Principal Deferral
Deferred for years 1 and 2, 15% due in each of years 3 and 4, 70% due in
year 5

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While MSNLF and MSPLF supported new loans, MSELF loans allowed businesses to expand
existing loans or revolving credit facilities. The MSELF portion of the refinancing must have
been a term loan and senior or pari-passu in priority to the borrower’s other debt, except for
mortgage debt. The minimum MSELF loan was $10 million. The maximum was the lesser of
$300 million or an amount that would not cause the borrower’s total outstanding and undrawn
debt to exceed six times the borrower’s 2019 adjusted EBITDA.61
Loans to nonprofit organizations
MSLP offered two loan programs to nonprofit organizations: the Nonprofit Organization New
Loan Facility (NONLF) and the Nonprofit Organization Expanded Loan Facility (NOELF). Like the
MSLP programs available to for-profit businesses, the MSLP programs available to nonprofit
organizations offered support for both new loans (NONLF) and the expansion of existing loans
(NOELF). Also, like the MSLP loans to for-profit business, MSLP loans to nonprofit organizations
had some common terms:
Loan Term
Five years
Minimum Employees
At least 10 employees
Employees and Revenue
Either 15,000 or fewer employees, or 2019 revenue of $5 billion or less
Financial Conditions
•
Total non-donation revenues of at least 60% of expenses for 2017 through 2019
•
At least a 2% operating margin for 2019
•
At least 60 days current cash on hand
•
Ratio of cash, investments, and other repayment resources to outstanding debt and
certain other liabilities of greater than 55%
Endowment Cap
Less than $3 billion
Rate
Adjustable Rate of LIBOR (one month or three months) plus 3%
Interest Deferral
Deferred for one year
Principal Deferral
Deferred for years 1 and 2, 15% due in each of years 3 and 4, 70% due in year 5

From October 30, 2020 on, the NONLF minimum loan amount was $100,000.62 The maximum
loan amount was the lesser of $35 million or the borrower’s average quarterly revenue in 2019.
The new loan did not need to be senior to the borrower’s existing debt but could not be
contractually subordinated to that debt.63
NOELF loans, like MSELF loans, allowed borrowers to refinance existing loans or revolving credit
facilities. The NOELF portion of the refinancing must have been a term loan and senior or pari-
passu in priority to the borrower’s other debt, except for mortgage debt. The minimum NOELF

61 See Term Sheet, Main Street Expanded Loan Facility, Board of Governors of the Federal Reserve System (December 29, 2020),
https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20201229a3.pdf
62 The minimum loan amount for the NONLF was decreased from $250,000 to $100,000 on October 30, 2020 (See Federal
Reserve Board press release (October 30, 2020)), Periodic Report, supra note 58.
63 See Term Sheet, Nonprofit Organization New Loan Facility, Board of Governors of the Federal Reserve System (December 29,
2020), https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20201229a4.pdf.

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loan was $10 million. The maximum was the lesser of $300 million or the borrower’s average
quarterly revenue in 2019.64

Letters of Inquiry
In addition to the above information, on which SIGPR regularly reports, SIGPR transmitted three
formal requests for information to Treasury officials in the prior administration during the
reporting period and in the weeks leading up to submission of this report.
In its first letter, dated December 15, 2021, SIGPR requested a briefing and asked specific
questions relating to the then-Secretary’s request65 that the Federal Reserve return unused
Treasury funds appropriated by the CARES Act for the Federal Reserve facilities. SIGPR’s second
letter, dated December 18, 2020, followed up on this letter, requesting Treasury to identify the
specific CARES Act provisions and any related legal analysis underlying the then-Secretary’s
requested return of the unused funds. SIGPR’s letters are included in Appendix B.
On January 6, 2021, SIGPR transmitted a letter to Treasury’s Office of General Counsel,
requesting information regarding changes to the rules governing the Main Street Lending
Program that had been discussed in recent news reports.66 SIGPR’s letter is included in
Appendix C.

64 See Term Sheet, Nonprofit Organization Expanded Loan Facility, Board of Governors of the Federal Reserve System
(December 29, 2020), https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20201229a5.pdf.
65 Letter from then- Secretary Mnuchin to Chair Powell on the Status of Facilities Authorized Under Section 13(3) of the Federal
Reserve Act (November 19, 2020), https://home.treasury.gov/system/files/136/letter11192020.pdf.
59“Texas Fracking Billionaires Drew Covid-19 Aid While Investing in Rivals." The Wall Street Journal, Dec. 27, 2020.
https://www.wsj.com/articles/texas-fracking-billionaires-drew-covid-19-aid-while-investing-in-rivals-11609070400.

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APPENDICES

APPENDICES
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39
Appendix A
Program-Specific Rules Relating to Capital Access and Multiple-Dipping Under the CARES Act

CARES Act Program
Rules Relating to Access to Multiple Streams of Funds
Section 4003 Loans
(Title IV, Subtitle A)
•
Credit Availability Review. A borrower is eligible if “credit is not reasonably available” to
the borrower “at the time of the” loan.xxxiv Treasury “and its financial and legal advisors
will take into account evidence from the prospective borrower’s particular circumstances,
including its relationships with existing and potential creditors, as well as general market
conditions.”xxxv

•
Additional stipulations for non-air-carrier businesses. Businesses may be eligible if they
are non-air-carrier U.S. businesses that “have not otherwise received adequate economic
relief in the form of loans or loan guarantees provided under the CARES Act that are
certified under 14 CFR Part 145 and approved to perform inspection, repair, replace, or
overhaul services (‘Part-145 certified repair station operators’); ticket agents as defined in
49 U.S.C. § 40102; or businesses critical to maintaining national security.”xxxvi

•
Federal Reserve Facilities. A recipient of a loan under Section 4003 is not eligible to
receive support under the Main Street Lending Program or either of the Corporate Credit
Facilities.
Main Street Lending
Program (MSLP)
(Title IV, Subtitle A)
•
PPP Recipients: The Federal Reserve has taken the positionxxxvii that “a Business that has
received PPP loans, or that has affiliates that have received PPP loans, is permitted to
borrow under Main Street, provided that the Business is an Eligible Borrower.”xxxviii An
MSLP borrower, however, must complete a certification form reporting its PPP debt
load.xxxix

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CARES Act Program
Rules Relating to Access to Multiple Streams of Funds
Primary Market Corporate
Credit Facility (PMCCF)
(Title IV, Subtitle A)
•
An eligible entity “may not participate in the PMCCF and a Main Street Lending
Facility.”xliii

•
An eligible entity “must not have received specific support pursuant to the CARES Act or
any subsequentxliv federal legislation.”

•
An eligible entity may “utilize tax credits or tax relief in the CARES Act and still participate
in the CCFs.”xlv

•
Secondary Market Corporate Credit Facility (SMCCF) Participants Subject to Per-Issuer
Limits. An eligible entity may “participate in . . . the PMCCF at the same time its bonds
have been or are being purchased by the SMCCF . . . but the collective purchases by the
PMCCF and SMCCF of an eligible issuer’s debt are subject to the per-issuer limits described
in the respective Term Sheets.”xlvi
Secondary Market
Corporate Credit Facility
(SMCCF)
(Title IV, Subtitle A)
•
An “eligible issuer must not have received specific support pursuant to the CARES Act or
any subsequent federal legislation.”xlvii

•
“An issuer may utilize tax credits or tax relief in the CARES Act and still participate in the
CCFs.”xlviii

•
PMCCF Participants Subject to Per-Issuer Limits. “An eligible issuer [may] participate in . .
. the PMCCF at the same time its bonds have been or are being purchased by the SMCCF . .
. but the collective purchases by the PMCCF and SMCCF of an eligible issuer’s debt are
subject to the per-issuer limits described in the respective Term Sheets.”xlix
Term Asset-Backed
Securities Facilities (TALF
II)
(Title IV, Subtitle A)
•
Credit Availability Review. “Under the Board’s Regulation A, the New York Fed must
obtain evidence that participants in the TALF are unable to secure adequate credit
accommodations from other banking institutions . . . . Lack of adequate credit does not
mean that no credit is available. Credit may be available, but inadequate in its amount,
price, or terms.”l

•
“SBA Pool Certificates that include PPP loans in the underlying collateral pool are eligible
ABS.”li

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CARES Act Program
Rules Relating to Access to Multiple Streams of Funds
criteria for other CARES Act support programs are set forth in the Act and any applicable
guidance or regulations.”liv
Coronavirus
Relief Fund
(Title V)
•
Local Governments Eligibility. The CARES Act does not explicitly prevent local
governments (regardless of their eligibility for direct assistance) from receiving
Coronavirus Relief Fund payments from state governments, so long as the funds are used
for eligible purposes.
Paycheck Protection
Program (PPP)
•
Loan Must Be New in Purpose and Amount. “An eligible recipient applying for a covered
loan shall make a good faith certification . . .”
o
“that the eligible recipient does not have an application pending for a loan under
this subsection for the same purpose and duplicative of amounts applied for or
received under a covered loan . . . .”lv
o
“during the period beginning on February 15, 2020 and ending on December 31,
2020, that the eligible recipient has not received amounts under this subsection
for the same purpose and duplicative of amounts applied for or received under a
covered loan.”lvi

•
SBA Guidance Regarding EIDL Recipients.
o
“Nothing in this paragraph shall prohibit a recipient of an economic injury
disaster loan made under subsection (b)(2) during the period beginning on
January 31, 2020 and ending on the date on which covered loans are made
available that is for a purpose other than paying payroll costs and other
obligations described in subparagraph (F) from receiving assistance under this
paragraph.”lvii
o
“Borrowers can apply for both the PPP and EIDL, although funds from both
cannot be used for the same purpose.”lviii
o
“If you took out an Economic Injury Disaster Loan (EIDL) between February 15,
2020 and June 30, 2020 and you want to refinance that loan into a PPP loan, you
would add the outstanding loan amount to the payroll sum.”lix

•
MSLP Recipients: The Federal Reserve has taken the position that “a Business that has
received PPP loans, or that has affiliates that have received PPP loans, is permitted to
borrow under Main Street, provided that the Business is an Eligible Borrower.”lxi But an
MSLP borrower must complete a certification form reporting its PPP debt load.lxii

Economic Injury Disaster
Loan (EIDL)
•
SBA Guidance Regarding PPP Recipients. “Borrowers can apply for both the PPP and EIDL,
although funds from both cannot be used for the same purpose.”lxiii

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CARES Act Program
Rules Relating to Access to Multiple Streams of Funds
•
A business that already has both an EIDL loan and a PPP loan “may still qualify for a new
SBA disaster loan for losses resulting from a declared disaster in your community.”lxv

•
Main Street Lending. A business receiving a loan under the SBA’s “EIDL program can be an
Eligible Borrower under Main Street if it meets the Eligible Borrower criteria.”lxvi

xxxiv CARES Act § 4003(c)(2)(A).
xxxv https://home.treasury.gov/system/files/136/CARES-Airline-Loan-Support-Q-and-A-national-security.pdf.
xxxvi https://home.treasury.gov/system/files/136/CARES-Airline-Loan-Support-Q-and-A-national-security.pdf.
xxxvii The Federal Reserve’s position on the eligibility of PPP and EIDL recipients for the MSLP appears to stem from an
interpretation of CARES Act § 4002(4)(B) that is at odds with how the Department of the Treasury has interpreted that same
provision. CARES Act § 4002(4)(B) defines the term “eligible business” as a non-air-carrier “United States business that has not
otherwise received adequate economic relief in the form of loans or loan guarantees provided under this Act.” In its guidance
regarding the loan program under Title IV, Subtitle A, Treasury further defines the term “eligible business,” in part, as non-air-
carrier “businesses certified by the Department of Transportation under 14 C.F.R. Part 145 . . . that have not otherwise received
adequate economic relief in the form of loans or loan guarantees under other programs authorized by the Act.” Procedures and
Minimum Requirements for Loans to Air Carriers and Eligible Businesses and National Security Businesses under Division A, Title
IV, Subtitle A of the Coronavirus Aid, Relief, and Economic Security Act, U.S. Dep’t Treasury, at 2 (March 30, 2020),
https://home.treasury.gov/system/files/136/Procedures%20and%20Minimum%20Requirements%20for%20Loans.pdf. That
guidance defines “the Act” as the entire CARES Act. Id. at 1. Accordingly, it appears Treasury understands the definition of
“eligible business,” as provided in CARES Act § 4002(4)(B), to exclude otherwise qualifying non-air-carrier businesses that have
received an adequate loan or loan guarantee under any program established under the CARES Act. This would not allow an
MSLP applicant to have participated in the PPP. The Federal Reserve’s guidance, however, provides that an MSLP applicant
“must not have received specific support pursuant to the Coronavirus Economic Stabilization Act of 2020 (Subtitle A of Title IV
of the CARES Act),” which the Federal Reserve clarifies to mean that “[a] Business is not eligible [for the MSLP] if it has received
support pursuant to Section 4003(b)(1)-(3) of the CARES Act.” Main Street Lending Program FAQs, For-Profit Businesses, Board
of Governors of the Federal Reserve System, at 27 (Dec. 29, 2020), https://www.bostonfed.org/mslp-faqs. Accordingly, it
appears the Federal Reserve understands the definition of “eligible business,” as provided in CARES Act § 4002(4)(B), to exclude
only those otherwise qualifying non-air-carrier businesses that have received an adequate loan or loan guarantee under Title IV,
Subtitle A. This would allow an MSLP applicant to have participated in the PPP.
xxxviii https://www.bostonfed.org/mslp-faqs.
xxxix https://www.bostonfed.org/-/media/Documents/special-lending-facilities/mslp/legal/ppp-forgiveness-form.pdf?la=en.
xl https://www.bostonfed.org/mslp-faqs.
xli https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq.
xlii https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20201030a4.pdf;
https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20201030a5.pdf.
xliii https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq.
xliv Notably, the prohibition against receiving specific support under “subsequent federal legislation” appears to be unique to
the Corporate Credit Facilities and is not incorporated into the Federal Reserve’s guidance regarding other facilities—nor is such
a prohibition included in Treasury’s guidance, which, as explained above, deviates slightly from the guidance issued by the
Federal Reserve.
xlv https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq.
xlvi https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq.
xlvii https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq. “To participate in
the PMCCF as an issuer or in the SMCCF as an issuer of eligible individual corporate bonds, the issuer must certify that it has not
received specific support pursuant to the CARES Act. This issuer certification is not required in connection with the SMCCF
broad market index purchase program. "Specific support" in this context means specific support pursuant to Section 4003(b)(1)-
(3) of the Coronavirus Economic Stabilization Act of 2020 (Subtitle A of Title IV of the CARES Act) . . . . An issuer will not be
eligible for the PMCCF or SMCCF if it has received a loan, loan guarantee, or other investment from the Treasury Department
under Section 4003(b)(1)-(3).” Id.
xlviii https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq.

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xlix https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq.
l https://www.newyorkfed.org/markets/term-asset-backed-securities-loan-facility/term-asset-backed-securities-loan-facility-
faq.
li https://www.newyorkfed.org/markets/term-asset-backed-securities-loan-facility/term-asset-backed-securities-loan-facility-
faq.
lii https://www.newyorkfed.org/markets/term-asset-backed-securities-loan-facility/term-asset-backed-securities-loan-facility-
faq.
liii https://www.newyorkfed.org/markets/term-asset-backed-securities-loan-facility/term-asset-backed-securities-loan-facility-
faq.
liv https://home.treasury.gov/system/files/136/QandA-Payroll-Support-to-Air-Carriers-and-Contractors.pdf.
lv CARES Act § 1102 (15 USC 636(a)(36)(G)(i)(III)).
lvi CARES Act § 1102 (15 USC 636(a)(36)(G)(i)(IV)).
lvii CARES Act § 1102 (15 USC 636(a)(36)(Q)).
lviii https://www.sba.gov/sites/default/files/2020-11/COVID%20EIDL%20FAQ%20rev%20112320-508.pdf.
lix https://www.sbc.senate.gov/public/_cache/files/2/9/29fc1ae7-879a-4de0-97d5-
ab0a0cb558c8/1BC9E5AB74965E686FC6EBC019EC358F.the-small-business-owner-s-guide-to-the-cares-act-final-.pdf.
lx https://www.whitehouse.gov/wp-content/uploads/2020/06/M-20-26.pdf.
lxi https://www.bostonfed.org/mslp-faqs.
lxii https://www.bostonfed.org/-/media/Documents/special-lending-facilities/mslp/legal/ppp-forgiveness-form.pdf?la=en.
lxiii https://www.sba.gov/sites/default/files/2020-11/COVID%20EIDL%20FAQ%20rev%20112320-508.pdf. SBA also previously
provided the following guidance: “Note that businesses that received an EIDL Advance in addition to the PPP loan will have the
amount of the EIDL Advance subtracted from the forgiveness amount of their PPP loan.” The rule underlying that guidance,
however, has since been repealed, and the repeal is intended to apply retroactively. See Economic Aid Act § 333(c), (d).
lxiv https://www.sba.gov/sites/default/files/2020-11/COVID%20EIDL%20FAQ%20rev%20112320-508.pdf.
lxv https://www.sba.gov/sites/default/files/2020-11/COVID%20EIDL%20FAQ%20rev%20112320-508.pdf.
lxvi https://www.bostonfed.org/mslp-faqs.

APPENDICES
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44
Appendix B
Letter to General Counsel from Special Inspector General, December 15, 2020

APPENDICES
SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY | QUARTERLY REPORT TO CONGRESS | OCTOBER 1 - DECEMBER 31, 2020

46
Letter to General Counsel from Special Inspector General, December 18, 2020

APPENDICES
SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY | QUARTERLY REPORT TO CONGRESS | OCTOBER 1 - DECEMBER 31, 2020

47
Appendix C
Letter to General Counsel from Special Inspector General, January 6, 2021

APPENDICES
SPECIAL INSPECTOR GENERAL FOR PANDEMIC RECOVERY | QUARTERLY REPORT TO CONGRESS | OCTOBER 1 - DECEMBER 31, 2020

HELP FIGHT
FRAUD,
WASTE, AND
ABUSE.

report@sigpr.gov
202-927-7899

Office of the Special Inspector General for Pandemic Recovery| U.S. Department of the Treasury
1500 Pennsylvania Avenue NW, Suite 4428| Washington, D.C. 20220
www.sigpr.gov

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SIGPR Quarterly Report to Congress

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