Well, that didn’t age well… 
A new UT-Austin study further emphasizes that the #PPP, designed to serve the needs of struggling businesses during the worst of the pandemic, suffered from high rates of fraud made possible with the help of FinTechs. papers.ssrn.com/sol3/papers.cf…
Per the study:
- 15% of PPP loans (~1.8M loans/$76 billion) were potentially fraudulent.
- FinTechs were 5x more likely to have issued a potentially fraudulent loan than traditional lenders.
- 15% of PPP loans (~1.8M loans/$76 billion) were potentially fraudulent.
- FinTechs were 5x more likely to have issued a potentially fraudulent loan than traditional lenders.
- 9 / 10 of the top lenders with fraud or poor underwriting and documentation practices in the program were FinTechs (or community bank/FinTech partnerships).
- 19 / 20 were all nonbanks. The 20th is a community bank.
- 19 / 20 were all nonbanks. The 20th is a community bank.
- The 3 most prolific lenders of potentially fraudulent loans each pocketed over $900 million in processing fees.
This is just another example that FinTechs can’t be trusted to police themselves. keepbankingsafe.com
This is just another example that FinTechs can’t be trusted to police themselves. keepbankingsafe.com
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