Enforcement Risks for Recipients of U.S. CARES Act and Other Federal Funds
The COVID-19 pandemic has created a seemingly constant state of concern and activity for companies in all sectors, with many businesses trying to launch new initiatives and find new financing to weather the storm and provide much-needed assistance in this unprecedented time. Many companies are stepping into the government contracting space to fill gaps in medical equipment and services, some for the first time. Many businesses will also apply for and receive aid from the U.S. government under the recently-enacted Coronavirus Aid, Relief and Economic Security Act — a $2 trillion stimulus package that (among other things) provides nearly $350 billion in Small Business Administration loans, as well as hundreds of billions of dollars in funding and other resources for healthcare companies and others supplying goods and services to support the COVID-19 response. While the receipt of government funds and aid will undoubtedly be a welcome relief, it also comes with significant legal risks. Companies receiving these funds can expect that their activities will be put under a microscope — and should plan accordingly now.
