Treasury Secretary Steven Mnuchin told CNBC it was “outrageous” for the Los Angeles Lakers to seek a federal COVID-19 loan and warned others applying for relief that they could risk criminal charges if they don’t follow guidelines. (See below for the clip.)
The Lakers on Monday opted to give back the loan after incurring backlash from those who pointed out the federal funds were intended for small businesses decimated by the pandemic. Restaurant chains Ruths Chris Steakhouse and Shake Shack also surrendered the funds after blowback. Several entertainment entities, among them 42West parent Dolphin Entertainment, Cinedigm and Emmis Communications, have disclosed in SEC filings that they have secured federal loans.
“I never expected in a million years that the Los Angeles Lakers — I’m a big fan of the team, but I’m not a fan of the fact that they took a $4.6 million loan,” Mnuchin said. “I think that’s outrageous and I’m glad they returned it, or they would have had liability.”
Mnuchin, who joined the administration after a career in finance and experience backing Hollywood films, declared the federal program an “overwhelming success,” helping 30 million workers en route to an eventual 60 million. The secretary said 1 million loans so far have gone to companies with 10 or fewer employees.
The Small Business Administration in the future, Mnuchin said, will conduct a “full review” of any loan over $2 million. Criminal charges may result if companies try to game the system.
The Lakers did attract support in some corners after giving back the money.
“People find this hard to believe, but this part is true,” ESPN host Stephen A. Smith said on SiriusXM’s The Joe Madison Show. “Unlike Steve Ballmer, who owns the Los Angeles Clippers and is worth over $40 billion, the Lakers are the true epitome of a ‘mom-and-pop organization,’ per se. They don’t have that kind of dough.”
President Donald Trump was expected to address the state of the U.S. Paycheck Protection Program during a Tuesday afternoon news conference at the White House.
Here’s a large portion of the Mnuchin interview via CNBC’s Twitter account: