Michelle E. of Scottsdale, Arizona, was relieved when President Trump last month signed into law the sweeping stimulus package intended to keep the U.S. economy afloat during the coronavirus pandemic.
Michelle and her husband have owned a small hardwood flooring business for 18 years. She hoped the law’s $350 billion for small-business loans would help them avoid laying off any of their five employees, whom she said are like family. So she got a loan application through her bank.
But as she filled it out, Michelle saw the question: Had any of the business owners pleaded guilty to or been on probation for a criminal offense? Michelle immediately thought of her husband, who is on probation because he took a guilty plea on a theft charge after taking home the scope of someone else’s rifle on a hunting trip, something he says he did accidentally. His name and her last name are being withheld because his criminal case, and the couple’s loan application, are pending.
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“Because of that, our employees can’t get help from the United States government?” Michelle said.
It’s a little noticed frustration compared to the logistical problems of the Trump administration’s rollout of the CARES Act. A set of new regulations for implementing the law, issued by the Small Business Administration, prohibits small-business owners with criminal records from accessing the desperately needed loans.
“We have never seen such a sweeping mandatory disqualification based on a criminal record, in any area of the law,” wrote the Collateral Consequences Resource Center, a nonprofit, nonpartisan website that tracks how federal, state and local laws affect people with past charges or convictions. The site is run by Margaret Love, who was the U.S. Pardon Attorney during the Clinton administration.
It is unclear how many small-business owners nationally have a criminal history. But The Sentencing Project, a research and advocacy group, has estimated that as many as 100 million Americans have an arrest or conviction in their past, and there are more than 30 million small businesses around the country, according to the Small Business Administration. Because people with felony records in particular often can’t get jobs, many start their own businesses, from plumbing to food-services to fitness, experts say.
Source: Trump Administration Tells Some Business Owners “Do Not Apply” for Coronavirus Loans
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