SBA investigating PPP loan to Virginia radio company paid millions to broadcast CCP propaganda
TThe Small Business Administration watchdog was tasked with investigating after a Virginia radio company that received millions of dollars to broadcast Chinese Communist Party propaganda received more than $ 100,000 through the paycheck protection program.
Potomac Radio Group, which this month registered under the Foreign Agents Registration Act for its work for the Chinese state-run Global TV Network, received a loan of 106,228 $ through the SBA in April 2020, with the loan canceled by the U.S. government eight months later. . A source familiar with the matter told the Washington Examiner that the SBA asked fraud experts to undertake a review of the loan after the pardon and also referred the controversy to the SBA Inspector General for investigation.
Potomac owns WCRW AM 1190, which is heard in Virginia, Maryland, and Washington, DC. The company admitted it was paid nearly $ 4.4 million by CGTN and CCP-affiliated China Radio International in 2019, 2020 and 2021.
“The SBA does not comment on individual borrowers. The SBA takes fraud seriously and, as such, all applicants are required to provide proof of eligibility when applying, ”said Shannon Giles, public affairs manager at the SBA. Washington Examiner. “The false declaration of admissibility is illegal and, if so, these cases are referred to the Office of the Inspector General. The Office of the Inspector General and the agency’s federal partners work diligently to resolve incidents of fraud.
Potomac co-owner Brian Lane told the Washington Examiner, “We do not comment on potential or ongoing government communications” but that “we believe that we have fully followed the rules and the process”.
Sheldon Shoemaker, SBA deputy inspector for management and operations, told the Washington Examiner that “the OIG’s practice is not to confirm or deny investigative activity.”
DC RADIO STATIONS BROADCAST CCP PROPAGANDA
Congress added more stringent loan eligibility requirements when the Follow-Up Economic Assistance Act became law in December 2020. SBA rules for 2021 note that the law “prohibits several additional categories of borrowers to receive a second PPP loan, “including” certain entities organized under the laws of the People’s Republic of China “as well as” any person required to submit a registration statement “under FARA.
The source insisted that a company like Potomac would now be considered ineligible for a PPP loan because it would have been classified as a company engaged in lobbying.
Horizon Advisory, a strategy consulting firm, released a report in August 2020 claiming that $ 192-419 million in PPP loans had been made to more than 125 companies owned or invested by Chinese entities, and that at least 32 Chinese companies have received loans worth more than one million dollars, totaling between 85 and 180 million dollars. These numbers have undoubtedly increased since then.
“The CCP treats the recovery of COVID-19 as a competitive interaction,” the study authors wrote, adding: “The extent and nature of the PRC-owned, PRC-vested and PRC-related entities among PPP loan recipients indicate that without an appropriate policy guardrail, U.S. tax dollars intended for relief, recovery, and growth of the U.S. economy – and small businesses in particular – are likely to support foreign competitors , namely China. ”
Republican Senator Marco Rubio introduced the law preventing SBA assistance from traveling to China in March 2021, with the aim of taking additional measures to prevent any SBA assistance from going to Chinese entities.
“American companies are no stranger to the wide range of strategies Chinese companies use to starve their competitors,” said the Florida Republican. “Exploiting taxpayer-funded SBA programs designed to boost our small businesses is among the most egregious.”
Potomac’s WCRW launched the The Bridge podcast in August 2020, with the show co-hosted by Chicago-based John St. Augustine and CRI’s Zhou Heyang. Episodes of the podcast featured St. Augustine and Zhou praising China’s response to the coronavirus pandemic, while St. Augustine repeatedly attacked Americans and the United States’ response and said he didn’t care the origin of COVID-19.
At the request of Trump’s Justice Department, the CGTN registered as China’s foreign agent in 2019. Trump’s State Department designated the CGTN and the IRC as “foreign missions” to China. China in 2020.
Potomac acquired WUST and WCRW in 2019, WUST broadcasting Spanish religious content and WCRW broadcasting CRI programs for years.
“We requested the loan for our two stations. Spanish pastors were having difficulty maintaining their churches during COVID and were unable to enter the studios to do their shows, ”Lane told the Washington Examiner, stating that the loan was only used for WUST, adding: “After the sale of WUST, we did not apply for the second round of PPP loans.”
Potomac’s FARA documents showed that prior to the April 2020 loan, he received $ 527,627 from CGTN in July 2019, $ 804,119 in August 2019 and $ 259,872 in September 2019, and received millions of dollars. the CCP since then.
Lane said that “we have ended some of our business with them and are currently reviewing our options, including selling the station.”
The FARA file indicates that the “main foreigner” in the Potomac is the CGTN, which is under the control of the CCP’s advertising department.
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Potomac said it purchased the station in January 2019 and “continued to broadcast programming material prepared for broadcast by CGTN.”
“We are not agents of the CCP,” Lane insisted. “The previous owners consulted the DOJ in 2015 and were not required to register.… However, the views of the DOJ have evolved since then… Although we still believe we did not need to register, we did. ”
Justice Department spokesman Wyn Hornbuckle told the Washington Examiner that the Ministry of Justice “will neither confirm nor deny the existence of an ongoing investigation”.