Clifford Chance

The CARES Act: A double-edged sword for the incautious

4 May 2020

The opportunity to receive government support as part of the largest stimulus package in US history presents opportunity—and potential risk. Through the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act" or the "Act"), the US government authorized roughly $2 trillion in stimulus, and created new oversight mechanisms to protect the integrity of those funds. Another stimulus package followed in late April, and more may still be to come. While the funds can present an attractive opportunity, even a lifeline, companies should be aware that the funds will come with scrutiny and second-guessing, especially when the current crisis subsides.

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