The Strand Bookstore, a nearly century-old New York City landmark, has agreed to pay nearly $1.5 million to resolve a dispute over a COVID-era Paycheck Protection Program (PPP) loan. The Department of Justice stated that the loan was improperly obtained due to restrictions concerning the ownership of the business.
In February 2021, The Strand applied for a $932,350 PPP loan. According to the U.S. Attorney's office in Washington, D.C., the application required an assurance that no spouse of a member of Congress held a controlling interest in the business. Nancy Bass Wyden, the granddaughter of the store's founder, has been married to Senator Ron Wyden for over two decades, a fact the Justice Department said made the application "knowingly and materially false."
"The Paycheck Protection Program was created to save American jobs, not to enrich those who aren’t eligible for taxpayer-funded relief, especially the wife of a US senator," said US Attorney for the District of Columbia, Jeanine Pirro. Pirro’s office noted that the settlement does not include a determination of liability.
The PPP was established under the CARES Act in March 2020 to help small businesses retain employees during pandemic-related closures. In late 2020, Congress approved additional funding and a "second draw" for eligible businesses. However, the Economic Aid Act introduced a restriction preventing businesses from receiving a second loan if a member of Congress or their spouse held a controlling interest.
In a statement, Nancy Bass Wyden acknowledged the bookstore's regret over the "oversight" and emphasized its commitment to legal compliance. She explained that the restriction was implemented between the first and second rounds of the PPP, and neither the bookstore's accountant nor the administering bank were aware of the change at the time the second-draw application was processed. Wyden asserted that the mistake was unintentional and occurred amid rapidly changing pandemic regulations, and that the funds were returned as soon as the issue was identified.
In October 2020, The Strand had appealed to its supporters for aid, stating that its business model was unsustainable and revenue had dropped by 70% due to the pandemic.
The settlement followed an investigation initiated by whistleblower claims, with support from the Small Business Administration. Pirro's office indicated this was the second recovery under its Fraud and Asset Recovery Division, established in September.