McCune Law Group investigating Bank of America over alleged misleading statements that tricked small businesses into taking out PPP loans
PPP loans taken through Bank of America were later revealed to be unforgivable for some business owners
McCune Law Group, McCune Wright Arevalo Vercoski Kusel Weck Brandt APC (MLG) is investigating claims against Bank of America over allegedly misleading statements that have tricked small businesses into taking out what they thought were forgivable loans. These business owners claim they later discovered the loans were unforgivable. The investigation is about whether the marketing of the PPP loans offered by the CARES act was fatally flawed. The investigation is about whether Bank of America marketed PPP loans not only to business with employees who report income on W-2s, but also to those that had contract workers who file 1099s – even though payments of those contract workers were not eligible for forgiveness.
Are you a small business owner who employs contractors and received a PPP loan through Bank of America that is now not being forgiven?
McCune Law Group Investigates Bringing a Class Action Against Bank of America Over Misleading Statements Impacting Small Business Owners
McCune Law Group, McCune Wright Arevalo Vercoski Kusel Weck Brandt APC (MLG) is investigating the need to bring a class action lawsuit against Bank of America over claims of misleading marketing regarding the Paycheck Protection Program (PPP) loan funds they advertised to small businesses during the COVID-19 pandemic. According to complaints, Bank of America advertised these livelihood-saving loans as 100% forgivable by the federal government when there were actually stipulations that were allegedly not made clear to business owners. In truth, PPP loans were only forgivable if the workers in the business were not independent contractors, leaving businesses for which contract work is normal and expected without forgiveness options.
PPP Loans Were Designed to Be a Lifeline for Business Owners, Not a Burden
The Coronavirus Aid, Relief, and Economic Security (CARES) Act was passed in response to the economic downturn and devastation to small and mid-sized businesses caused by the COVID-19 pandemic. In March 2020 alone, business shutdowns designed to limit the spread of COVID-19 pushed more than 22 million people out of work – a mass layoff of a scale never seen before. The impact of the shutdowns fell disproportionately on low-income workers, with more than half of all job losses occurring in industries with low average wages. In response, the CARES act was passed in two parts, it allocated $649 billion to assist these businesses in keeping their workers employed. The Paycheck Protection Program (PPP) provides federally guaranteed loans of up to $10 million to small business, 100% of which may be forgiven if the borrower retains its employees on the payroll.
These forgivable loans expanded the SBA’s existing small business-loan program known as the 7(a)-loan program. The expanded portion of the program arose from part of the CARES Act called the Paycheck Protection Program (PPP). The SBA also partnered with numerous banks across America, including Bank of America, to issue PPP loans to small businesses. The banks that partnered with the SBA marketed the PPP Loan program to potential applicants and accepted applications for those loans on the SBA’s behalf. The PPP Loans were administered by the banks, subject to terms set by the SBA. If the borrower complied with the SBA’s terms and was eligible for loan forgiveness, the issuing bank was required to forgive the borrower’s PPP Loan and be paid instead by the SBA.
Have you received a PPP loan from Bank of America, but discovered your contract workers don’t qualify you for forgiveness? Contact MLG by completing the form today!
Frequently Asked Questions:
The Paycheck Protection Program (PPP), established by the CARES Act, provides small businesses with the funds to pay up to 8 weeks of payroll costs including benefits. The funds provided can also be used to pay interest on mortgages, rent, and utilities.
If you were a victim of the alleged misleading statements by Bank of America, you can contact our team to set up a free consultation regarding your potential case. We will explore all avenues to ensure that you receive maximum compensation.
If you are a small to medium-sized business whose employees consist of independent contractors, there is a likely chance that your loans may be unforgiveable. If you are unsure whether your loans can be forgiven or not, contact our financial services team today for a free consultation of your potential case.
Contract Workers Render Promises of Loan Forgiveness Null and Void for Small Businesses
Bank of America’s alleged misleading marketing of the PPP Loan program is claimed to be fatally flawed. The SBA only forgives loans to business owners with employees who report income on IRS Form W-2, not to independent contractors. Despite this limitation, BANA marketed PPP Loans not only to businesses with employees who report income on Form W-2, but also those that had contract workers who report on Form 1099—even though payments to those contract workers were not eligible for forgiveness. Defendant’s marketing and application materials consistently and repeatedly misrepresented PPP Loan forgiveness eligibility for these business owners with contractor-workers reporting Form 1099 income.
If you been victim of these alleged misleading statements by Bank of America, contact us today by filling out the form above to schedule a consultation.
How You Can Join This Action Against Bank of America:
The Financial Services attorneys at McCune Law Group are pursuing Bank of America on behalf of consumers who were affected by Bank of America’s misleading statements. You may be eligible to join the action against Bank of America, here is how you can join:
- Fill out our form with your information
- Set up your free consultation
- Meet with our Financial Services team
- Discuss your potential case
- Discuss your next steps
A member of our Financial Service team is ready to help you recover your unfairly charged overdraft fees!
Handling this Investigation
Richard D. McCune is the founder of McCune Law Group. He has 30 years of experience in representing plaintiffs throughout the United States, California and the Inland Empire in class action, government UDAP civil penalties, product liability, catastrophic personal injury, and business fraud cases. Mr. McCune’s successful results for his clients include a $203 million class action verdict in 2010 on behalf of the 1.14 million California Wells Fargo Bank customers for unfair bank overdraft fees. He has been involved in numerous settlements and verdicts that have generated over one million dollars for individual clients.
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