A congressional report finds lax anti-fraud standards, execs who cashed in, and contempt for small loan applicants.
at the time, “would have been obvious if even the bare minimum of due diligence had been conducted on the loan applications.”
In a statement, the company said it was proud of the role it played in supporting businesses during the pandemic. “Kabbage’s existing online lending platform was able to process the sudden flood of loan applications, in a timely manner, in the midst of a national crisis and in light of ever-changing federal lending rules,” it said. “Kabbage adhered to the applicable rules and regulations in good faith.
One such lender singled out in the report, Blueacorn, instructed staff to push through high-dollar loans that the company called “VIPPP” loans internally. The original fee structure for PPP loans meant that small loans netted Blueacorn and other services a few hundred dollars, while large loans would yield tens of thousands of dollars.
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