ANNAPOLIS, Md., April 3, 2020 /PRNewswire/ -- The lawsuit
alleges at a time of severe national need, Defendants Bank of
America Corporation ("Bank of America") and Bank of America, N.A.
("BNA") (collectively, "Defendants" or "BOA") instead privileged
discriminatory policies of corporate greed over the needs of
America's small businesses.
According to the lawsuit, authorized by Congress and the
President under the Coronavirus Aid,
Relief, and Economic Security Act, H.R. 748 ("CARES Act")
and its loan programs to administer billions of dollars in federal
funding to small businesses in a fair, equitable and uniform
manner, Defendants allegedly implemented a loan process that
unlawfully prioritized their existing borrowing clients and barred
their depository clients and other small businesses from even
applying for funds from the governmental loan programs.
Nothing in the CARES Act authorizes or permits Defendants to pick
and choose who would gain access to or benefit from the federally
backed lending program. And, the priority of access to these
limited funds is material – the demand is overwhelming as America
responds to the economic tsunami of COVID-19 upon small
businesses. There is no justification for
allegedly requiring depository clients and other small
businesses to go to the end of the line.
Named Plaintiff Profiles, Inc. ("Named Plaintiff" or "Profiles")
brings this action, on behalf of itself and all others similarly
situated, against BOA for violations of the CARES Act", violations
of the Small Business Administration's ("SBA") 7(A) loan program,
15 U.S.C. § 636(a), a declaratory judgment pursuant to 28 U.S.C. §
2201, and a preliminary and permanent injunction pursuant to 28
U.S.C. § 2202.
The Paycheck Protection Program ("PPP"), which is part of the
$2 trillion stimulus package created
by the CARES Act in response to the COVID-19 pandemic that was
signed in to law on March 27, 2020,
empowers lenders to make available as much as $349 billion in government-guaranteed loans to
cover eight weeks of payroll and other expenses.
The lawsuit alleges that BOA – creating an unnecessary
restriction on PPP loans – is refusing to accept PPP loan
applications unless the small business is an active borrower with
BOA. BOA is thus unlawfully prioritizing existing customers
who are active borrowers as of February
2020.
Indeed, BOA has allegedly denied access to the PPP program to
small businesses that do not have a "lending" relationship with
BOA. Profiles, which has a depository relationship with BOA,
was prohibited by BOA from even applying for a PPP loan with BOA,
despite meeting the statutory requirements for a PPP loan.
The purpose and motivation behind BOA's alleged discriminatory
practice is transparent – it is prioritizing its balance sheet by
supporting preexisting loans issued by BOA through the PPP program
at the expense of small business customers who do not have a
lending relationship with BOA.
Senators Marco Rubio (R.-Fla.)
and Ben Cardin (D.-Md.) have already
chastised BOA for imposing criteria not found in the law and
selectively choosing who can apply.
BOA's alleged discriminatory practices are abhorrent and in
violation of federal law. In this time of national need,
BOA's discriminatory practices can only be described as corporate
greed.
For details about the lawsuit, contact Alan Rifkin, Rifkin Weiner Livingston LLC, at
arifkin@rwllaw.com or (410) 960-1779.
View original
content:http://www.prnewswire.com/news-releases/rifkin-weiner-livingston-llc-sues-bank-of-america-for-class-action-for-prioritizing-its-lending-clients-and-denying-access-to-the-ppp-program-to-its-depository-clients-and-other-small-businesses-301035474.html
SOURCE Rifkin Weiner Livingston LLC