SBA Handed Out $5.4BN in Potential Fraudulent Loans

The government doled out nearly 100,000 pandemic loans to people whose applications were filed using suspect Social Security numbers, government investigators revealed Monday.

The suspicious applications were awarded $5.4 billion from the Small Business Administration.

Investigators said the bogus payments appear to have been made early on, when the Trump administration was eager to pump money into the economy and worried less about controls of fraudulent claims. Applicants weren’t even checked against the Treasury Department’s “Do Not Pay” list.

Controls got better as the initial shock of the pandemic wore off. But by then, much of the money was already out the door, according to the Pandemic Response Accountability Council, the consortium of inspectors general that has been tasked with policing the spending.

“The PRAC identified $5.4 billion in potential identity fraud associated with 69,323 questionable and unverified SSNs used across disbursed COVID-19 EIDL and PPP applications — that is, applications that successfully received a loan and/or grant,” the PRAC said in its report.

Through the Economic Injury Disaster Loan program and the Paycheck Protection Program, SBA received more than 33 million applications and doled out nearly $1.2 trillion in loans.... (Read more)

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