A federal watchdog for pandemic relief funding is asking for information about Texas Senator Ted Cruz’s efforts to change a loan program. The requirements for the program were changed shortly after Cruz wrote to managers. The changes benefited Cruz’s major donors.
The Federal Reserve’s Main Street Lending Program has provided loans to businesses suffering from the economic effects of the pandemic. According to a December report in the the Wall Street newspaper, shortly after Cruz wrote to Fed Chairman Jerome Powell and former Treasury Secretary Steve Mnuchin in April, two key loan program requirements were changed.
These changes enabled Cruz’s two major financial donors to secure a federal-backed loan of $ 35 million. Texas billionaires Farris and Dan Wilks’ ProFrac Holdings LLC received the loan while buying or increasing their stakes in other oil and gas companies.
Now Brian D. Miller, the Special Inspector General for Pandemic Recovery, is asking the Treasury Department of Cruz’s office communications. The inspector also wants to know the rationale for the change in the loan program.
“While recent reports do not allege malpractice, they relate to the management of investments made by the secretary under CARES. [Act] – a central area of jurisdiction for the special inspector general for pandemic recovery, ”Miller wrote to a Treasury Department lawyer last month.
The letter was annexed to the inspector’s report recent quarterly report to Congress.
An email from Cruz’s office at KERA highlighted the economic damage the pandemic has caused to an already struggling oil and gas industry.
“With the price of oil at -37 $, energy producers on the verge of bankruptcy and tens of thousands of blue-collar workers in Texas whose jobs are at stake, Senator Cruz has worked to ensure that small and medium-sized businesses are directly affected. by the economic impacts of this pandemic have had access to emergency liquidity, ”said spokeswoman for Cruz, Maria Jeffrey Reynolds. “The result of his leadership has been a program that has helped about 25 US energy producers, including about a dozen in Texas, and helped protect more than 300,000 oil and gas jobs in Texas.”
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Update: February 3, 2021 at 5:57 p.m. CST
This story has been updated to include comments from Senator Ted Cruz’s office.