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MrBeast, Jeffree Star, and FaZe Clan Received Coronavirus Relief Loans

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  • Jeffree Star, MrBeast, and FaZe Clan all received Paycheck Protection Program loans designed to help small businesses during the pandemic, according to a ProPublica database that tracks the disbursement of the federal loans.
  • MrBeast and Star both received loans ranging from $350,000 to $1 million, and FaZe Clan confirmed they had received $1.1 million.
  • Representatives for FaZe Clan and MrBeast defended the move in statements to Mashable and said they were concerned about the future of their financial situations and the loss of brand deals when they applied.
  • The move prompted backlash from people who argued the money should have gone to small businesses that needed it to survive, not wealthy creators.
  • Others, however, said that the government is responsible for who receives PPP loans. In fact, the program has received significant criticism in the past for giving loans to wealthy and politically connected organizations at the expense of small businesses in high need.

PPP Loans to Big Creators

Companies belonging to YouTube creators Jeffree Star and MrBeast as well as the esports organization FaZe Clan all received federal loans intended to help small businesses during the coronavirus pandemic.

The loans were given as part of the Paycheck Protection Program (PPP), which was signed into law under the CARES Act.

Reports about these specific creators were first reported on Wednesday by Mashable, which found the information in a searchable  ProPublica database that tracks all the PPP money that has been doled out.

According to the database, Jeffree Star Cosmetics was approved for a loan ranging from $350,000 to $1 million on May 3. MrBeast YouTube LLC was approved for a loan in the same range about a month earlier on April 14. The PPP application for FaZe Clan Inc was accepted at the end of April, for a loan ranging from $1 to $2 million.

“MrBeast and Jeffree Star’s loans are particularly surprising because both YouTubers have built brands on luxury and extravagance,” Mashable reported. 

“As thousands of small businesses struggle to stay afloat amid continued social distancing restrictions, YouTubers and other online figures are still able to safely churn out content. Immensely successful companies like Jeffree Star’s and FaZe Clan are hardly the brands hurting the most right now.”

Breakdown of Loans

To support those claims, the article goes on to give a more detailed look at the finances of each company and creator.

Staring with MrBeast, whose real name is Jimmy Donaldson, Mashable detailed the frequent and hefty giveaways the creator often holds.

“[He] frequently gives away cash prizes, cars, and most recently, a private island through outlandish stunts,” the outlet reported, noting that he has been described as “YouTube’s viral philanthropist,” and detailing some of his more recent big charitable giveaways.

In June, MrBeast pledged to split a $150,000 donation to organizations supporting racial justice and police reform as well as several small businesses. As for how much PPP money his company got, a representative who talked to Mashable did not say, but the outlet reported MrBeast YouTube LLC received a total of $377,000.

“Multiple sponsors pulled out of projects, our advertising revenue plummeted by 70 percent, and we had numerous finished videos we couldn’t post,” the representative explained to Mashable. “We didn’t have access to testing, so we also had no idea at the time when we would be able to produce new content. We felt this was the best avenue that would help us weather the storm.”

The spokesperson also said that that the company is different from MrBeast’s personal accounts, and added that “all charitable donations, including a $150,000 to Black Lives Matter and $250,000 to SpecialEffect of course did not come from company resources.”

As for Jeffree Star, Mashable points to the wealth he has accumulated from his makeup empire. In 2018, Star was listed on Forbes’ highest-paid YouTubers. That year, he reportedly brought in $18 million and Jeffree Star Cosmetics was worth an estimated $100 million.

The article does note that Star likely took a hit because Morphe cut ties with him, but that happened after he was approved for the loan on May 3.

Regarding FaZe Clan, Mashable reported that the organization is valued at $240 million and ranks fourth on Forbes’ most valuable esports companies. As for how much money they got, the head of communications for the organization confirmed that they had received $1.1 million. 

Notably, the outlet also pointed out that in early April— just a few weeks before they were given that loan— FaZe Clan announced that they had  “closed out a $40 million funding round that also secured an exclusive partnership with NTWRK, an e-commerce platform that also works with Nike and Puma.” 

At the time, FaZe Clan CEO Lee Trink told Forbes that despite the circumstances, “we are fortunate we are in the right industry for a moment like this, when everyone is turning to esports and streaming, and we are positioned to be bigger on the other side of it.”

In a statement to Mashable, Trink defended taking the PPP loan.

“As a growing business, we continued to expand our staff in January. We are grateful for the PPP loan because it has allowed us to retain 100 percent of our employees despite having to reduce our revenue projection by many millions in esports alone due to the pandemic,” he said.

“It has always been our intention to repay the loan in full and we plan to as soon as it is safe to do so.”

Response

Many peopled responded to the news on social media and expressed anger that these companies had received money set aside for small businesses.

Others also took specific aim at MrBeast, asking why he would take money from the government that had been designated for struggling companies if he had enough personal wealth to be giving away his own money.

“Small businesses desperately applying for PPP loans and shutting down after not receiving it are victims of the actions of Mr. Beast and others like him,” one Twitter user wrote. “He has no right to take govt money and then re-give out to those he deems worthy. That’s simply powerful ppl playing with $$”

On the other side, some people also said that MrBeast deserved the loan because he helps people. Others still argued that these companies and creators are not directly to blame and that its really on the government to decide who the loans go to.

From early on, the Trump administration has received significant backlash over its handling of the PPP loan disbursements, specifically in regards to who has received them and who has not.

When the money was first being sent out, massive outrage spread over the fact that Shake Shack received a $10 million PPP loan, which it eventually gave back. Since then, there has also been anger around other big recipients like Ruth’s Chris Steakhouse, Potbelly Sandwich Shop, the Catholic Church, and the Lakers.

Companies owned by wealthy celebrities like Khloe Kardashian, Kanye West, and Reese Witherspoon have also drawn ire for receiving PPP aid.

Problems From the Top

While some have argued that those people never should have applied in the first place, there is also hard evidence showing tons of issues with how this money has been allocated from the top down.

Earlier this month, a House oversight committee concluded that thousands of PPP loans were given to companies that should not have received them. 

According to a report released just last Tuesday by the Select Subcommittee on the Coronavirus Crisis, the Trump administration gave hundreds of loans to companies that did not even fill out complete applications, as well as nearly $100 million to companies that were ineligible for the loans because they had been banned from working with the federal government.

Other studies and reports have found that many large companies got loans before small businesses, who were largely left out of the first round of loan distributions despite needing the money the most. 

For example, economists at the University of Chicago and MIT found that just 15% of companies in the areas “most affected by declines in hours worked and business shutdowns” received PPP funding, but in areas least affected, 30% of companies received PPP funding. 

Even beyond all of that, there are a ton of problems with the data and records of the loans that not only call into question how the program is managed but also how effective it has been in helping companies keep employees on their payroll.

According to a recent report by The Los Angeles Times, out of the roughly 4.9 million loans awarded as of July, over 550,000 approved applications listed zero jobs retained, and over 320,000 left it blank entirely. Seven loans even listed negative jobs retained. 

The Times also reported that many small businesses were approved for loans much bigger than what they actually recieved and that there was no explanation for the discrepancy in the data.

Both Democrats and Republicans have pushed for another round of PPP funding in the next coroanvirus stimulus bill, but without a massive overhaul to the system and increased accountability measures, many are concerned the loans will continue to be improperly allocated.

See what others are saying: (Mashable) (Insider) (The Los Angeles Times)

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Schools Across the U.S. Cancel Classes Friday Over Unverified TikTok Threat

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Officials in multiple states said they haven’t found any credible threats but are taking additional precautions out of an abundance of safety.


School Cancelled

Schools in no fewer than 10 states either canceled classes or increased their police presence on Friday after a series of TikToks warned of imminent shooting and bombs threats.

Despite that, officials said they found little evidence to suggest the threats are credible. It’s possible no real threat was actually ever made as it’s unclear if the supposed threats originated on TikTok, another social media platform, or elsewhere. 

“We handle even rumored threats with utmost seriousness, which is why we’re working with law enforcement to look into warnings about potential violence at schools even though we have not found evidence of such threats originating or spreading via TikTok,” TikTok’s Communications team tweeted Thursday afternoon. 

Still, given the uptick of school shootings in the U.S. in recent years, many school districts across the country decided to respond to the rumors. According to The Verge, some districts in California, Minnesota, Missouri, and Texas shut down Friday. 

“Based on law enforcement interviews, Little Falls Community Schools was specifically identified in a TikTok post related to this threat,” one school district in Minnesota said in a letter Thursday. “In conversations with local law enforcement, the origins of this threat remain unknown. Therefore, school throughout the district is canceled tomorrow, Friday, December 17.”

In Gilroy, California, one high school that closed its doors Friday said it would reschedule final exams that were expected to take place the same day to January.

According to the Associated Press, several other districts in Arizona, Connecticut, Illinois, Montana, New York, and Pennsylvania stationed more police officers at their schools Friday.

Viral Misinformation or Legitimate Warnings?

As The Verge notes, “The reports of threats on TikTok may be self-perpetuating.”

For example, many of the videos online may have been created in response to initial warnings as more people hopped onto the trend. Amid school cancellations, videos have continued to sprout up — many awash with both rumors and factual information.

 “I’m scared off my ass, what do I do???”  one TikTok user said in a now-deleted video, according to People. 

“The post is vague and not directed at a specific school, and is circulating around school districts across the country,” Chicago Public Schools said in a letter, though it did not identify any specific post. “Please do not re-share any suspicious or concerning posts on social media.”

According to Dr. Amy Klinger, the director of programs for the nonprofit Educator’s School Safety Network, “This is not 2021 phenomenon.”

Instead, she told The Today Show that her network has been tracking school shooting threats since 2013, and she noted that in recent years, they’ve become more prominent on social media. 

“It’s not just somebody in a classroom of 15 people hearing someone make a threat,” she said. “It’s 15,000 people on social media, because it gets passed around and it becomes larger and larger and larger.”

See what others are saying: (The Verge) (Associated Press) (People)

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Jake Paul Says He “Can’t Get Cancelled” as a Boxer

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The controversial YouTuber opened up about what it has been like to go from online fame to professional boxing.


The New Yorker Profiles Jake Paul

YouTuber and boxer Jake Paul talked about his career switch, reputation, and cancel culture in a profile published Monday in The New Yorker. 

While Paul rose to fame as the Internet’s troublemaker, he now spends most of his time in the ring. He told the outlet that one difference between YouTube and boxing is that his often controversial reputation lends better to his new career. 

“One thing that is great about being a fighter is, like, you can’t get cancelled,” Paul said. The profile noted that the sport often rewards and even encourages some degree of bad behavior.

“I’m not a saint,” Paul later continued. “I’m also not a bad guy, but I can very easily play the role.”

Paul also said the other difference between his time online and his time in boxing is the level of work. While he says he trains hard, he confessed that there was something more challenging about making regular YouTube content. 

“Being an influencer was almost harder than being a boxer,” he told The New Yorker. “You wake up in the morning and you’re, like, Damn, I have to create fifteen minutes of amazing content, and I have twelve hours of sunlight.”

Jake Paul Vs. Tommy Fury

The New Yorker profile came just after it was announced over the weekend Paul will be fighting boxer Tommy Fury in an 8-round cruiserweight fight on Showtime in December. 

“It’s time to kiss ur last name and ur family’s boxing legacy goodbye,” Paul tweeted. “DEC 18th I’m changing this wankers name to Tommy Fumbles and celebrating with Tom Brady.”

Both Paul and Fury are undefeated, according to ESPN. Like Paul, Fury has found fame outside of the sport. He has become a reality TV star in the U.K. after appearing on the hit show “Love Island.”

See what others are saying: (The New Yorker) (Dexerto) (ESPN)

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Hackers Hit Twitch Again, This Time Replacing Backgrounds With Image of Jeff Bezos

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The hack appears to be a form of trolling, though it’s possible that the infiltrators were able to uncover a security flaw while reviewing Twitch’s newly-leaked source code.


Bezos Prank

Hackers targeted Twitch for a second time this week, but rather than leaking sensitive information, the infiltrators chose to deface the platform on Friday by swapping multiple background images with a photo of former Amazon CEO Jeff Bezos. 

According to those who saw the replaced images firsthand, the hack appears to have mostly — and possibly only — affected game directory headers. Though the incident appears to be nothing more than a surface-level prank, as Amazon owns Twitch, it could potentially signal greater security flaws. 

For example, it’s possible the hackers could have used leaked internal security data from earlier this week to discover a network vulnerability and sneak into the platform. 

The latest jab at the platforms came after Twitch assured its users it has seen “no indication” that their login credentials were stolen during the first hack. Still, concerns have remained regarding the potential for others to now spot cracks in Twitch’s security systems.

It’s also possible the Bezos hack resulted from what’s known as “cache poisoning,” which, in this case, would refer to a more limited form of hacking that allowed the infiltrators to manipulate similar images all at once. If true, the hackers likely would not have been able to access Twitch’s back end. 

The photo changes only lasted several hours before being returned to their previous conditions. 

First Twitch Hack 

Despite suspicions and concerns, it’s unclear whether the Bezos hack is related to the major leak of Twitch’s internal data that was posted to 4chan on Wednesday.

That leak exposed Twitch’s full source code — including its security tools — as well as data on how much Twitch has individually paid every single streamer on the platform since August 2019. 

It also revealed Amazon’s at least partially developed plans for a cloud-based gaming library, codenamed Vapor, which would directly compete with the massively popular library known as Steam.

Even though Twitch has said its login credentials appear to be secure, it announced Thursday that it has reset all stream keys “out of an abundance of caution.” Users are still being urged to change their passwords and update or implement two-factor authentication if they haven’t already. 

See what others are saying: (The Verge) (Forbes) (CNET)

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