Philly Area Congresswoman requests investigation into SBA’s PPP loan for defunct Wynnewood restaurant

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When the Trump administration released the results of its much-touted antivirus loan program last month, it said a $ 5 million or more loan saved 500 jobs at an Italian restaurant on Lancaster Avenue in Wynnewood. The problem was that Buca di Beppo had closed seven years earlier.

Now a congressman is calling on the Small Business Administration to explain the error in the Payroll Protection Plan loan data.

“According to data from the SBA, a PPP loan saved 500 jobs in Buca di Beppo in my district that don’t exist,” US MP Mary Gay Scanlon, a Democrat, wrote to the agency. “It is important that we closely monitor the funds already allocated so that future funds can be allocated fairly and effectively.”

In letters Monday, Scanlon called for investigations into how the PPP loan was linked in government data to the long-closed restaurant in their district that now houses a children’s clinic. She sent the letters to the SBA; to the restaurant chain’s parent company, Earl Enterprises of Orlando, Florida; and to PNC Financial Services Group, the Pittsburgh-based bank that granted the loan.

In fact, the chain said, funds from a $ 5 million to $ 10 million award and another similar loan – listed for a company restaurant in Columbus, Ohio – were used to pay salaries at its 75 locations across the country . The restaurant at 260 E. Lancaster Ave. closed in the first week of 2013.

Scanlon serves a first full term in the US House of Representatives in a district that includes all of Delaware and portions of Montgomery and South Philadelphia. She wrote the letters after The Inquirer uncovered Buca di Beppo’s inaccurate credit information in its reporting of errors, mischaracteristics, and omissions in the data of the $ 659 billion PPP program in July.

The program, which lawmakers hastily passed in the spring to help companies with 500 or fewer employees cope with the coronavirus pandemic, exempts recipients from repaying their loans if at least 60% of the money is used on payroll.

Treasury Secretary Steven T. Mnuchin initially rejected calls by advocacy groups and lawmakers to disclose who received money for months after the program was approved, even though such information was routinely shared by previous administrations through similar loans.

When Mnuchin reversed course and the data was eventually disclosed, the administration broke with previous practice by not fully identifying beneficiaries and not disclosing all loan amounts. The exact amount of the loan from Buca Di Beppo has not been disclosed.

Mnuchin, at the time of publication, interpreted the data to suggest that the program had supported more than 51 million jobs, with more than a quarter of the funding going to low- and middle-income communities.

However, claims about the program’s impact were quickly undermined by complaints from alleged loan recipients about the accuracy of the data, while other records were proven to be inaccurate.

In a breakdown that affected credit far more frequently in the Philadelphia area than across the country, thousands of records contained blank spaces where the number of jobs retained was allegedly or a zero in those fields, falsely suggesting that recipients weren’t I didn’t use the money to save a single job.

Other errors have been made in companies claiming never to complete loan applications but reporting millions of dollars. In other cases, recipients, including Philadelphia restaurant tycoon Michael Schulson, incorrectly stated their actual loan amounts in the records.

“It was only after repeated bipartisan congressional inquiries and inquiries from journalists about the Freedom of Information Act that the SBA consented to the disclosure of PPP loan information – only to uncover a number of worrying discrepancies in the data provided,” Scanlon wrote in her letter to the SBA.

Scanlon urged the agency to “work with Buca Restaurants Inc. and PNC to correct the above inaccuracies, work with lenders to correct additional inaccuracies, and investigate all credit cases listing addresses unrelated to the The borrowers’ offices have to do ”.

Buca di Beppo spokeswoman Amy Sadowsky said the chain is investigating why the defunct Wynnewood location is on the loan filing and will discuss the issue with Scanlon’s office on Monday. PNC spokesman Jason Beyersdorfer said the bank is also researching the matter.

The SBA did not respond to messages asking for comment.

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