The Justice Department issued grand jury subpoenas to large banks involved in the coronavirus emergency loan program.
The DOJ reportedly issued the subpoenas from their Washington, D.C., fraud division amid growing worries of fraud. The report says the subpoenas do not necessarily impugn wrongdoing on the banks, according to Reuters.
“Right now, we don’t think banks are 100% the target. There are concerns that there will be a boomerang effect six months down the road on banks that they didn’t do enough,” a source told Reuters.
The subpoenas allow the DOJ to obtain a variety of financial and personal documents and to hear witness testimony as part of a criminal investigation. Major banks received the subpoenas, but all declined to comment on the matter.
The report said the Justice Department would potentially pursue banks should they be found to facilitate or ignore fraud willfully. JPMorgan Chase, Citigroup, Bank of America, and Wells Fargo were the largest banks to partake in the lending program.
Under the Paycheck Protection Program, small businesses can be provided government-backed loans to remain afloat amid the coronavirus pandemic. The loans can be forgiven so long as the borrower spends at least 75% of the money on payroll to maintain employees.
The DOJ opened an investigation into the program in April and has reportedly charged some borrowers which it found lied about the financial status of their businesses.
