Skip to content
COVID-19

IN BRIEF: Loosening criminal history bar for COVID-19 loans does not moot lawsuit -store owner

Brendan Pierson  

Brendan Pierson  

(Reuters) - A Maryland convenience store who sued the U.S. Small Business Administration over its rule prohibiting businesses owned by people with criminal histories from applying for COVID-19 relief loans on Friday urged a court to keep the case alive despite an “11th hour” change to the program by the SBA that rendered him eligible to apply.

”Unless this court exercises its constitutional office to rein in this administrative overreach, the defendants will continue to regulate as if they are above the law,” Altimont Mark Wilks said in a brief filed in federal court in Baltimore.
 
The $670 billion Paycheck Protection Program was established by Congress in March to provide low-interest loans to businesses struggling due to the pandemic. Wilks, who owns Hagerstown, Maryland-based convenience store Carmen’s Corner Store and auto parts delivery company Retail4Real, said in a lawsuit filed earlier this month that he sought $31,500 in PPP loans after both businesses suffered losses due to the pandemic.
 
Wilks said he learned he was not eligible because he had served 15 years in prison after pleading guilty to state and federal drug and weapons offenses and is on parole until 2021. He said Congress had not authorized the SBA to exclude people on the basis of criminal history.
 
Earlier this week, the SBA revealed that it had changed the rule so that it only applied to people whose parole began within the last five years, and only for certain crimes. As a result, it argued that the case should be dismissed as moot.
 
The case is Carmen’s Corner Store, et al, v. Small Business Administration, U.S. District Court, District of Maryland, No. 20-cv-01736.
 
For Wilks: John Vecchione and Jared McClain of the New Civil Liberties Alliance
 
For the SBA: James Gilligan, U.S. Department of Justice.

To keep up-dated on the latest news and information regarding the COVID-19 pandemic, the economic impact, and the government’s response, at Thomson Reuters’ COVID-19 Resource Center, and you can follow Reuters.com or the Reuters App.