Luetkemeyer Sends Letter to Inspector General Requesting Answers on SBA Direct Lending
WASHINGTON, D.C. – Today, House Committee on Small Business Ranking Member Blaine Luetkemeyer sent a letter to the Small Business Administration's (SBA) Inspector General (IG) requesting answers on how the SBA has performed as a direct government lender in the past.
"Shortly after the COVID EIDL program commenced, fraud developed and communication issues became widespread. This report proved to be prescient. As the program underwhelmingly disbursed more and more dollars, your own subsequent reporting identified and thoroughly examined numerous alarming issues. For example, you found approximately $80 billion in potentially fraudulent activity in the COVID relief program that was delivered to small businesses directly through the SBA, over 800,000 EIDL applications that were flagged for identity theft concerns, and issues that resulted in small businesses waiting on average 49 days to receive funding during the early months of the emergency program’s operation. These are not characteristics that warrant an expansion of government lending. While these reports solely focus on COVID EIDL loans and its associated grants, my concerns are not limited to just this program, but rather to the SBA’s overall inability to act as a direct lender, no matter the program," wrote Luetkemeyer.
"Given recent proposals to expand SBA’s direct lending ability within the 7(a) Loan Program, I request your opinion on how the SBA has performed these tasks as a direct government lender in the past," concluded Luetkemeyer.
Read the full letter to Small Business Administration Inspector General Hannibal "Mike" Ware here.
"Shortly after the COVID EIDL program commenced, fraud developed and communication issues became widespread. This report proved to be prescient. As the program underwhelmingly disbursed more and more dollars, your own subsequent reporting identified and thoroughly examined numerous alarming issues. For example, you found approximately $80 billion in potentially fraudulent activity in the COVID relief program that was delivered to small businesses directly through the SBA, over 800,000 EIDL applications that were flagged for identity theft concerns, and issues that resulted in small businesses waiting on average 49 days to receive funding during the early months of the emergency program’s operation. These are not characteristics that warrant an expansion of government lending. While these reports solely focus on COVID EIDL loans and its associated grants, my concerns are not limited to just this program, but rather to the SBA’s overall inability to act as a direct lender, no matter the program," wrote Luetkemeyer.
"Given recent proposals to expand SBA’s direct lending ability within the 7(a) Loan Program, I request your opinion on how the SBA has performed these tasks as a direct government lender in the past," concluded Luetkemeyer.
Read the full letter to Small Business Administration Inspector General Hannibal "Mike" Ware here.
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