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Rocky Mount-based foundation unsure how $83M in COVID loans were spent

A Rocky Mount foundation says it has no idea who received more than $80 million in COVID-19 relief loans it gave out. The announcement comes after a report from the state auditor said the Golden Leaf Foundation didn't track how businesses spent the millions in taxpayer dollars it distributed.

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By
Keenan Willard
, WRAL eastern North Carolina reporter
ROCKY MOUNT, N.C. — Tuesday’s announcement comes after a report from the State Auditor said the Golden LEAF Foundation didn't track how businesses spent the millions in taxpayer dollars it distributed.

A spokesperson for Golden LEAF said the organization isn’t responsible for checking how businesses used the millions in pandemic relief money it gave out. But now, the foundation claims it doesn't even know who got the loans.

In May 2020, North Carolina set up a COVID-19 relief fund for businesses impacted by the pandemic using $3.6 billion in federal money. The state also established the NC Pandemic Recovery Office to find organizations to help by giving out the money to those in need.

One of those organizations was the Golden LEAF Foundation in Rocky Mount, which received $83 million to distribute as loans to small businesses.

"We found that Golden LEAF did not follow up to ensure that the businesses were spending the money on the allowed expenses," Wood said.

In a report issued last week, the State Auditor's office said Golden LEAF didn't require businesses who got loans to show how they were spending the money, or independently verify how the loans were being used.

"There was a waiting list,” Wood said. “So if you're not ensuring that the businesses that received the money were spending it for the right things, there's no way to stop the money or recall it and then give to businesses that are on the waiting list.”

In a response to the audit, Golden LEAF said the law only required the foundation to get a personal attestation from each businesses, which was essentially a promise the business would use the money for its intended purpose. Golden Leaf also claimed it didn't require spending reports because that's not a normal practice for small business lending.

"That is not true, and I think their response is weak and inadequate," Wood said. "These monies that are going out to help these small businesses are taxpayer dollars. I don’t care how you look at it ... to say that this is not normal practice -- of course it is."

WRAL News requested a list of all businesses that Golden LEAF gave loans to, as well as businesses on the waiting list. In a response, Golden LEAF said the foundation doesn't have a list of those who applied for or got the $83 million in loans.

"I'm surprised to hear that they just blatantly said that, but it’s obvious that they really don’t know how the monies were spent, and I’m not surprised they don’t know who it went to given their response to our audit report," Wood said.

The foundation said it partnered with a different organization, The NC Rural Center, to give out the loan money. The group is expected to provide Golden LEAF with data on who the money was given to at regular intervals.

A spokesperson for the NC Rural Center said the center "maintains all pertinent application materials and loan documentation submitted by the program's eight partner lenders."

"Throughout the life of the program, the Rural Center provided the Golden LEAF Foundation regular reports that outline the overall status, activity and outcomes of the program for monitoring purposes," the center said in a statement.

Since the program provided loans and not grants, the spokesperson for the NC Rural Center said reports submitted to Golden LEAF used unique identifiers for businesses to maintain confidentiality.

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