“You have a fiduciary responsibility when the government sets up a program to use it because you have no idea how long this pandemic will last, when or if there will be a therapy or vaccine,” said O ‘Leary on CNBC. “Squawk Box. ” ” You do not know. “
O’Leary, known as “Mr. Wonderful” on “Shark Tank”, responded to comments made by Cuban on Monday. The billionaire entrepreneur and owner of the Dallas Mavericks of the NBA has criticized companies such as Shake Shack for applying for loans through the Paycheck Protection Program, which is part of the Outbreak Relief Program of 2, $ 2 trillion last month.
The hamburger chain initially received a $ 10 million loan under the program. But a few days later, the company announced that it would return the money after accessing other types of capital through public markets. He also said that the program rules were confusing.
Ruth Steak Chris House and Potbelly also revealed that they have accessed PPP loans, which are available to businesses with 500 or fewer employees. Hotel chains and large restaurants were able to obtain an exemption for locations with fewer than 500 employees.
O’Leary, president of O’Shares ETFs, said it is “good” for companies to make a “marketing decision” to return the money after being criticized.
But he said he thought the uncertainty surrounding the coronavirus pandemic – and the loss of income associated with it – was too great not to tap into all types of government support. “If I were a shareholder of Shake Shack, and I am not, I would have questioned this decision” to return the money. He added: “They will look pretty stupid if in a year we are still talking about this pandemic in the same way. “
Shake Shack did not immediately respond to CNBC’s request for comment on O’Leary’s comments.
Randy Garutti, CEO of Shake Shack, told CNBC on Monday that the company had provided “long-term stability”. By making the money from the P3, he said, “now is the time for us to help our friends in the industry do the same. “
The paycheck protection program was originally funded with $ 349 billion, but ran out of money last week. The Senate could potentially vote Tuesday to add money to the program.
– Disclosure: CNBC has exclusive rights to off-grid cable over “ Shark aquarium“, Of which Kevin O’Leary is co-host.