Wellshire Financial Services got the money despite rules meant to prevent most lenders from qualifying for the Main Street program
A company owned by a major donor to President Trump that operates auto-title loan stores with names such as LoanStar and Moneymax secured a $25 million low-interest loan from a government pandemic aid program, using what consumer advocates describe as a loophole to a rule designed to prevent most lenders from getting this federal help.
The cash infusion to Wellshire Financial Services — part of a multi-state title loan empire run by Atlanta businessman Rod Aycox — came from the Federal Reserve’s $600 billion Main Street Lending program for small- and medium-size businesses. It’s the same program that is among the Federal Reserve’s emergency lending facilities that will be allowed to expire at year’s end after Treasury Secretary Steven Mnuchin announced last week the unspent funds will be redirected to more distressed parts of the U.S. economy. The decision does not affect loans that already have been made, such as the one to Wellshire.
Wellshire’s government-backed, five-year loan came with a 3.15 percent interest rate, Fed records show. Continue reading.