The Small Business Administration distributed over $200 billion in potentially fraudulent COVID-19 loans and advances during the pandemic, or 17%, the agency's inspector general found.
The SBA during the pandemic disbursed approximately $1.2 trillion in Economic Injury Disaster Loan (EIDL) and Paycheck Protection Program (PPP) funds and in its rush to do so, "SBA calibrated its internal controls," the Office of Inspector General (OIG) said in a press release.
"The agency weakened or removed the controls necessary to prevent fraudsters from easily gaining access to these programs and provide assurance that only eligible entities received funds. However, the allure of 'easy money' in this pay and chase environment attracted an overwhelming number of fraudsters to the programs."
The OIG, in collaboration with the SBA, Secret Service, other federal agencies and financial institutions, says its investigation has resulted in nearly $30 billion in EIDL and PPP funds being seized or returned.
Rep. Roger Williams, R-Texas, chairman of the House Committee on Small Business, on Thursday slammed SBA Administrator Isabella Guzman for not showing for a hearing Thursday on the findings and suggested the SBA was not taking "every action possible to get these stolen funds back for the taxpayers."
"We cannot sweep this under the rug and write off all this fraud as a loss for the taxpayers," he said during the hearing, titled, "Stolen Taxpayer Funds: Reviewing the SBA and OIG Reports of Fraud in Pandemic Lending Programs."
"We must obtain a better understanding of what went wrong, how to fix these issues, and what we can do to recover these stolen taxpayer dollars. We stand ready to work to ensure the SBA has the oversight metrics in place to fairly report their past mistakes and, hopefully, to restore integrity in the agency," he added.
Solange Reyner ✉
Solange Reyner is a writer and editor for Newsmax. She has more than 15 years in the journalism industry reporting and covering news, sports and politics.
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