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In a surprising revelation, some of the music industry’s biggest names, including Post Malone, Chris Brown, LeAnn Rimes, and Nickelback, have allegedly received substantial financial support from a government program designed to aid struggling venues and musicians during the Covid-19 pandemic.
The Shuttered Venue Operators Grant, administered by the Small Business Administration (SBA), was initially established in 2021 as a lifeline for the live entertainment sector, which had been severely impacted by lockdowns. With an allocation of $14.5 billion, the program aimed to assist a wide array of entities, including movie theaters, performing arts venues, talent agencies, and artists, by providing financial relief to replace lost revenue.
Unlike the Paycheck Protection Program, which offered loans, the Shuttered Venue Operators Grant offered qualified applicants up to $10 million in non-repayable funds. This financial assistance has reportedly been capitalized upon by limited liability companies associated with prominent artists.
Among the notable recipients, it is alleged that singer Post Malone, whose estimated net worth exceeds $45 million, and R&B artist Chris Brown, with an estimated net worth of around $50 million, each received the maximum grant of $10 million. Other musicians, such as Lil Wayne, LeAnn Rimes, and Nickelback, also reportedly received significant payouts, albeit in varying amounts.
While the specific utilization of these funds remains undisclosed, there is currently no indication that the grants received by these high-profile artists were obtained unlawfully. The grants could potentially have been used to support a range of workers within the entertainment industry, including lighting and sound technicians, costumers, drivers, and security personnel, all of whom were adversely affected by the cancellation of tours and concerts.
It is important to note that there were no mandatory stipulations requiring corporations and limited liability companies to allocate the funds to support their workforce. Recipients were legally permitted to allocate the funds toward existing expenses such as mortgage payments, taxes, and payroll, including compensation for themselves.
In a comprehensive investigation, it was discovered that one Los Angeles-based asset-management firm, NKSFB, facilitated the submission of grants for numerous artists, venues, and managers, including Post Malone, metal band Korn, and electronic music star Steve Aoki. This firm reportedly secured a combined total of $260 million in grant funds.
Responding to the findings, an SBA spokesperson emphasized that the Shuttered Venue Program played a crucial role in assisting entertainment venues and operators throughout the pandemic, particularly benefiting small businesses with fewer than five full-time employees.
As concerns about the proper allocation of pandemic-era aid persist, recent reports suggest that a significant portion of the relief funds, approximately $200 billion, may have been misused or misappropriated. This amounts to roughly 17 percent of the total $1.2 trillion distributed by the SBA.
While there are ongoing efforts to investigate potential fraudulent claims, the SBA has indicated that fraudulent activity within the Shuttered Venue Program is estimated to be relatively low, accounting for less than 1 percent of the grants disbursed.