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Small Business Administration OIG

SBA’s Restaurant Revitalization Fund Program Award Practices

This SBA OIG pandemic oversight report reviewed the U.S. Small Business Administration’s Restaurant Revitalization Fund application review and approval process. The objective of this review was to determine whether the controls SBA implemented to award RRF program funds in accordance with the Act and other applicable guidance were effective. SBA developed an implementation plan including a risk framework that was intended to reduce the risk of making improper payments and awarding Restaurant Revitalization Funds (RRF) to ineligible recipients. However, the plan did not include all program...
Small Business Administration OIG

Evaluation of SBA’s Eligibility and Forgiveness Reviews of Paycheck Protection Program Loans Made to Borrowers with Treasury’s Do Not Pay Data Matches

This report is a follow up to SBA OIG Report Number 21-06, Paycheck Protection Program (PPP) Loan Recipients on the Department of Treasury’s (Treasury) Do Not Pay (DNP) List, which reported SBA did not use Department of Treasury (Treasury) DNP data to screen borrowers for eligibility prior to approving loans originated before August 8, 2020 (PPP round one). In this report, we assess SBA actions to address potentially ineligible loans identified in report 21-06 and its implementation of controls to review DNP data for PPP loans originated after August 8, 2020 (PPP round two). SBA implemented a...
Small Business Administration OIG

SBA's Handling of Identity Theft in the COVID-19 Economic Injury Disaster Loan Program

This report presents the results of our verification inspection of the U.S. Small Business Administration’s (SBA) corrective actions for the five recommendations from the Office of Inspector General (OIG) evaluation report SBA’s Handling of Identity Theft in the COVID-19 Economic Injury Disaster Loan Program (Report 21-15). We initiated this verification inspection to determine whether the closed recommendations were fully implemented or if further corrective actions were needed. Accordingly, our objective was to determine the effectiveness of the corrective actions SBA implemented to 1)...
Small Business Administration OIG

SBA's Internal Controls to Prevent Shuttered Venue Operators Grants to Ineligible Applicants

This report presents the results of our inspection to assess the U.S. Small Business Administration’s (SBA) Shuttered Venue Operators Grant (SVOG) controls to prevent disbursements to ineligible entities. Specifically, our review focused on general eligibility requirements applicable to all SVOG applicants and venue-specific requirements applicable to live venue operators. SBA delayed launching the SVOG application portal for over 2 weeks in April 2021 because of technical issues. In June 2021, SBA officials made program changes, which SBA called a “program refresh,” to accelerate application...
Small Business Administration OIG

Ending Active Collections on Delinquent COVID-19 Economic Injury Disaster Loans

The Small Business Administration's (SBA) Office of Inspector General (OIG) is issuing this management advisory to bring attention to concerns regarding SBA’s decision to end active collections on delinquent COVID-19 Economic Injury Disaster Loans (EIDL) with an outstanding balance of $100,000 or less. First, SBA’s decision to cease collections risks violating the Debt Collection Improvement Act of 1996, which prohibits ending collections on fraudulent, false, or misrepresented claims, because SBA OIG and other oversight agencies are continuing to work on identifying COVID-19 EIDL fraud that...
Small Business Administration OIG

SBA’s Oversight of Restaurant Revitalization Fund Recipients

We reviewed the U.S. Small Business Administration’s (SBA) oversight of Restaurant Revitalization Fund (RRF) recipients. The American Rescue Plan Act of 2021 authorized SBA to administer the RRF and provided $28.6 billion to assist eligible small businesses adversely affected by the Coronavirus Disease 2019 (COVID-19) pandemic. We determined program officials developed a plan for monitoring RRF award recipients use of funds and recovering unused or improperly awarded funds. However, program implementation was not executed in accordance with the plan. We made six recommendations for SBA to...
Small Business Administration OIG

SBA’s Awards for Staffing Support for COVID-19 Economic Relief Loan Programs

We reviewed the U.S. Small Business Administration’s (SBA) blanket purchase agreement with Highlight Technologies, LLC for loan support services. To meet the increased demand for Coronavirus Disease 2019 (COVID-19) loan program support services, SBA issued labor hour contracts, e.g. call orders, using an existing blanket purchase agreement. However, SBA contracting officials did not always perform adequate price analyses, awarding contracts that were not the best use of taxpayer funds. SBA did not establish adequate guidance to ensure contracting officials consistently followed federal...
Small Business Administration OIG

SBA’s Administrative Process to Address Potentially Fraudulent Restaurant Revitalization Fund Awards

We inspected the U.S. Small Business Administration’s (SBA) administrative process used to review potentially fraudulent Restaurant Revitalization Fund (RRF) applications and recover funds. Program officials designed the RRF application validation and approval processes using the Government Accountability Office’s A Framework for Managing Fraud Risks in Federal Programs. However, 3,790 applications submitted through a point-of-sale partner were processed without verifying gross sales, a key control designed to prevent ineligible entities from receiving awards. As a result, SBA’s RRF...
Small Business Administration OIG

COVID-19 Pandemic EIDL and PPP Loan Fraud Landscape

The U.S. Small Business Administration (SBA) Office of Inspector General (OIG) conducted this review to provide a comprehensive estimate of the potential fraud in the U.S. Small Business Administration’s (SBA) pandemic assistance loan programs. Over the course of the Coronavirus Disease 2019 (COVID-19) pandemic, SBA disbursed approximately $1.2 trillion of COVID-19 Economic Injury Disaster Loan (EIDL) and Paycheck Protection Program (PPP) funds. In the rush to swiftly disburse COVID-19 EIDL and PPP funds, SBA calibrated its internal controls. The agency weakened or removed the controls...
Small Business Administration OIG

Serious Concerns Regarding the Return of Paycheck Protection Program Funds

The Office of Inspector General (OIG) is issuing this management advisory to bring to your attention concerns regarding the return of Paycheck Protection Program (PPP) funds. This issue requires immediate attention and action by the U.S. Small Business Administration (SBA) to ensure it has processes and procedures in place to adequately accept, process, and account for PPP funds returned by borrowers, lenders, and financial institutions. Expedited management action should mitigate the risk of financial loss to taxpayers. Establishing clear and detailed guidance for borrowers, lenders, and...