Columbia businessman sues Regions Bank over ongoing PPP loan saga
Ryan Shiner
COLUMBIA, Mo. (KMIZ)
A Columbia businessman is suing Regions Bank in connection with previous COVID-19 era loans.
Greg DeLine filed a lawsuit in St. Louis County on Thursday, accusing the bank of negligent misrepresentation and constructive fraud.
The two sides have been responding in court since March over loans DeLine received from the Paycheck Protection Program in 2022. He went through Regions Bank to obtain them.
Regions Bank in May agreed to pay the federal government $4,919,631 to resolve allegations that it received payment it should not have in connection with the bank forgiving DeLine’s loan.
“This case is about a bank that promoted itself as ‘do[ing] what is right,’ ‘put[ting] people first,’ and ‘focus[ing] on its customer[s]’, but that instead misled its clients and then cut a deal with the government to escape the consequences,” the petition filed on Thursday says. “Regions Bank Inc. (‘Regions’) encouraged one of its longstanding clients, Gregory A. DeLine, to obtain a loan under the Paycheck Protection Program (‘PPP’) that it knew exceeded the amount for which he was eligible, and later recommended that the government forgive that same loan.”
The petition alleges that the bank required independent contractor information for PPP applications before it “belatedly concludes that independent contractor costs are ineligible but submits the application anyway,” court documents say. The petition alleges the bank requested more information from DeLine five days after the loan was accepted.
The petition also alleges DeLine tried to return “excess funds.” Regions Bank responded to the lawsuit in a statement that was sent to ABC 17 News on Thursday.
“While we strongly disagree with claims and mischaracterizations made in the recent filing, we look forward to addressing them through the proper forum, which is the legal system,” the statement says. “As we have shared previously, Regions facilitated over 75,000 Paycheck Protection Program loans during the height of the pandemic, helping small businesses remain open and supporting jobs in communities across our footprint. The issues surrounding this one individual loan were previously resolved with federal authorities, and it is unfortunate to see these claims raised regarding a matter that has already been addressed.”