A report released by the U.S. Small Business Administration Office of Inspector General (OIG) found that more than $200 billion of COVID relief funding meant for struggling businesses was taken by scammers.
In the 43-page report released Tuesday, Inspector General Hannibal āMikeā Ware writes that of the $1.2 trillion distributed by the SBA for the COVID-19 Economic Injury Disaster Loan (EIDL) and the Paycheck Protection Program (PPP) funds, 17% of the funds were ādisbursed to potentially fraudulent actors.ā
āThe economic assistance was intended to help eligible small business owners and entrepreneursā who had been affected by the COVID-19 pandemic, said the Inspector General in regards to the SBAās COVID-relief programs.
There were roughly 4.5 million cases of potentially fraudulent loan and grants issued from the COVID-relief programs, the Inspector General said.
As a result of the OIGās Investigation, ā1,011 indictments, 803 arrests, and 529 convictionsā were made having to do with PPL and EIDL Fraud, the Inspector General in the report.
Roughly ā$30 billion in COVID-19 EIDL and PPP fundsā have been recovered and returned back to the SBA, the report said.
In an interview with Fox News, Texas Rep. Roger Williams (R) called out the SBA for failing āto implement basic guardrailsā which would have protected the programs.
āRoughly 1 in 5 loans dispersedā were ālabeled as potentially fraudulent,ā said Williams. āWhen COVID-19 hit the United States, the SBA was tasked with taking on an oversized role to help save small businesses and our nationās job creators.ā
Williams lamented at how the SBA had not been āup to the task.ā
SBA spokesperson Han Nguyen said in a statement that āit is vital to clarify that 86% of the likely Fraudā had happened within the āfirst nine months of those programs.ā
āThe SBA IG has often noted, the rush to get funds out led to unwise decisions to pull down anti-Fraud guardrails,ā Nguyen said.