Small Business Administration (SBA) Administrator Kelly Loeffler announced Friday her agency has suspended 111,620 borrowers in California over alleged fraud related to pandemic-era loan programs.
These borrowers had secured a total of 118,489 Paycheck Protection Program (PPP) and Economic Injury Disaster Loans (EIDL) loans which amounted to more than $8.6 billion, according to an SBA news release. Loeffler said in a statement that the SBA is “taking decisive action” in an effort to “deliver accountability in a state whose unaccountable welfare policies have created a culture of fraud and abuse.”
“Once again, the Trump SBA is taking decisive action to deliver accountability in a state whose unaccountable welfare policies have created a culture of fraud and abuse at the expense of law-abiding taxpayers and small business owners,” Loeffler said. “Today, we announced we have suspended nearly 112,000 borrowers tied to at least $9 billion in suspected fraud.”
“This staggering number represents the most significant crack-down on those who defrauded pandemic programs, and it illuminates the scale of corruption that the Biden Administration tolerated for years,” she continued. “As we did in Minnesota, we are actively working with federal law enforcement to identify the criminals who defrauded American taxpayers, hold them to account, and recoup the stolen funds. As we continue our state-by-state work, our message is clear: pandemic-era fraudsters will not get a pass under this Administration.”
Loeffler also wrote in a statement posted to X on Friday that “California, just like Minnesota, invites criminals to abuse the system with socialist welfare policies.”
She added that fraud “scaled up massively during the pandemic – and the Biden Admin failed to stop it.”
“In San Diego, I visited a single address tied to 14 different ‘small businesses,’ that were formed during the pandemic, who received $2M+ in COVID-era loans that still haven’t been fully repaid,” she wrote in the social media post, adding that “the era of abuse is over.”
Loeffler also claimed in the X post that “under the Trump administration, any fraudster who broke the law will no longer get a free pass.”
In January, Loeffler similarly announced that the SBA was suspending thousands of borrowers in Minnesota over “suspected fraudulent activity” in connection with pandemic-era lending programs.
Minnesota made headlines in late 2025 after news first broke of a massive COVID relief and welfare fraud scheme in the state — in which the vast majority of those charged were of Somali descent.
A spate of pandemic-era relief programs, including the PPP, have been common targets of fraud in recent years, as the Daily Caller previously reported.
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