CSBA Defrauded of More Than $200 Billion in COVID-19 Funds
More than $200 billion in COVID-19 Pandemic Economic Injury Disaster Loans (EIDL) and Paycheck Protection Program (PPP) loans has been stolen or otherwise disbursed to fraudsters, the Small Business Administration (SBA)’s Office of the Inspector General (OIG) found.
That number represents 17 percent of all $1.2 trillion of these funds—$136 billion of $400 billion in EIDL funds and $64 billion of $800 billion in PPP funds—disbursed in the lives of the two programs.
The OIG faulted the SBA for weakening or removing “the controls necessary to prevent fraudsters from easily gaining access to these programs” and for allowing “fraudsters to take advantage of the economic crisis and [to] divert funding” that was intended for those who were legitimately eligible.
In its response, the SBA disputed the inspector general’s conclusions. Bailey DeVries, the acting associate administrator of the SBA’s Office of Capital Access, wrote that the OIG did not acknowledge that the SBA’s fraud controls improved dramatically over time. She also wrote that the amount of fraud was overestimated and inconsistent with the agency’s repayment data, and that the report conflated potential fraud with likely fraud.
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