Section 1 Short title
This Act may be cited as the “Returning Erroneous COVID Loans Addressing Illegal and Misappropriated Taxpayer Funds Act” or the “RECLAIM Taxpayer Funds Act”.
Returning Erroneous COVID Loans Addressing Illegal and Misappropriated Taxpayer Funds Act
AN ACT
To require the Administrator of the Small Business Administration to issue guidance and rules for lenders and the Small Business Administration on handling amounts of Paycheck Protection Loans returned by borrowers, and for other purposes.
Sec. 2 Paycheck Protection Loan return guidance
In general— Not later than 30 days after the date of the enactment of this Act, the Administrator of the Small Business Administration shall issue guidance for borrowers and lenders on returning any unused amounts of PPP loans made to the borrower.
Guidance requirements— The guidance required by subsection (a) shall include—
detailed guidance for borrowers on how to return to the lender that made a PPP loan to the borrower the unused amounts of such PPP loan;
detailed guidance for lenders regarding the responsibilities of lenders, including that a lender must—
accept the return of any unused amounts of any PPP loan from a borrower or any other source (including law enforcement) if the lender made such PPP loan;
document the reason for the return of such unused amounts, the identification number of the PPP loan, the name of the borrower of the PPP loan, and the name of the person returning such unused amounts if different than the borrower;
remit such unused amounts to the Administration;
make the guidance described in paragraph (1) available to borrowers described in such paragraph; and
if the lender made a PPP loan, periodically certify that the lender has reported and returned to the Administration all unused amounts of PPP loans returned to the lender;
detailed guidance for financial institutions holding funds from a PPP loan on the procedure for returning such funds to the Administration if the financial institution suspects the borrower may be committing fraud with respect to the PPP loan or any other issue for which the financial institution should return the funds the Administration; and
detailed guidance for borrowers and lenders of PPP loans, financial institutions described in paragraph (3), and other relevant individuals and entities on complying with the requirement to report to the Office of the Inspector General for the Small Business Administration any information indicating the occurrence of fraud with respect to a PPP loan.
Sec. 3 Returns handling process
In general— Not later than 30 days after the date of the enactment of this Act, the Administrator of the Small Business Administration shall issue guidance establishing a process for the Small Business Administration to track amounts of PPP loans returned to mitigate the risk of financial loss to the Federal Government.
Returns handling process requirements— The process established under subsection (a) shall require—
the Administration to accept returns of unused amounts of PPP loans; and
the Administrator to deposit in the general fund of the Treasury the unused amounts of PPP loans returned to the Administration.
Sec. 4 Definitions
In this Act:
Administration— The term Administration means the Small Business Administration.
Administrator— The term Administrator means the Administration of the Small Business Administration.
PPP loan— The term PPP loan means a loan made under paragraph (36) or (37) of section 7(a) of the Small Business Act (15 U.S.C. 636(a)).
Sec. 5 Compliance with CUTGO
No additional amounts are authorized to be appropriated to carry out this Act.