Reports

The Office of Inspector General is issuing this management advisory to present the results of our review of the U.S. Small Business Administration’s (SBA) incomplete reviews of Coronavirus Disease 2019 (COVID-19) Economic Injury Disaster Loans (EIDL) and grants disbursed to borrowers who self-disclosed their business establishment dates after January 31, 2020. SBA asserted that the Coronavirus Aid, Relief, and Economic Security (CARES) Act requirement for a business to be in operation on or before January 31, 2020, applied only to COVID-19 EIDLs, not Emergency EIDL Advances. The Office of...

The Office of Inspector General is issuing this management advisory to gain an understanding of the U.S. Small Business Administration’s (SBA) Coronavirus Disease 2019 (COVID-19) servicing processes and determine its capability to service more than 2 million COVID-19 Economic Injury Disaster Loans (EIDL). We found the COVID-19 EIDL Servicing Center (CESC) demonstrated that it was capable of servicing over 2 million COVID EIDLs during the period of our review. The CESC appeared to be adequately staffed as evidenced by its ability to complete over 23,500 servicing actions per month with an...

This report presents the results of our management advisory bringing the Small Business Administration’s (SBA) attention to concerns regarding forgiven Paycheck Protection Program (PPP) loans subsequently flagged as potentially ineligible using hold code 70 (potential clawback) for which the agency has not completed its review to facilitate recovery of improper payments for ineligible loans. A hold code is an identifier placed on a loan in the agency’s system indicating a potential issue needs to be resolved. SBA uses hold code 70 to flag forgiven PPP loans for which it subsequently suspects...

This report updates Congress on progress made by the U.S. Small Business Administration (SBA) on the 39 open pandemic-related recommendations referenced in Office of Inspector General (OIG) Report 23-09, COVID-19 Pandemic EIDL and PPP Loan Fraud Landscape. Over the course of the Coronavirus Disease 2019 (COVID-19) pandemic, SBA disbursed approximately $1.2 trillion of COVID-19 Economic Injury Disaster Loan and Paycheck Protection Program funds. The economic assistance was intended to help eligible small business owners and entrepreneurs adversely affected by the crisis. In Report 23-09, we...

The Office of Inspector General (OIG) is issuing this management advisory to bring attention to concerns regarding SBA’s use of hold codes for potentially fraudulent Paycheck Protection Program (PPP) loans referred by lenders. Opportunities exist for SBA to enhance its handling of lender-referred PPP loans suspected of fraud or illegal activity and its process for capturing these loans to ensure they are promptly flagged to mitigate fraud risk and financial loss. SBA’s Office of Credit Risk Management (OCRM) established a project for lenders to refer PPP loans suspected of fraud or illegal...