Hedge Funds Ruled Ineligible for U.S. Small Business Rescue
- Loans not meant for firms doing speculative trading, SBA says
- Private equity firms also don’t qualify, government says
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Hedge funds aren’t eligible for a signature U.S. rescue loan program, the government made clear Friday, potentially quelling a barrage of outrage over the possibility that well-heeled traders might beat out struggling small businesses for emergency funding.
The Small Business Administration, in consultation with the Treasury Department, determined that because hedge funds are primarily engaged in speculative investments, the firms shouldn’t be entitled to Paycheck Protection Program loans. The prohibition also applies to private equity firms, according to guidance posted on Treasury’s website.