Several ongoing cases of Paycheck Protection Program (PPP) loan fraud have been filed since the program ended on March 31, 2021. Some studies indicate that upward of 15% of all PPP disbursements around $125 billion might have been improperly made or fraudulently obtained. The House Committee on Small Business noted that multiple reports have found that financial technology (fintech) companies and their lending partners handled as much as 75% of PPP loans connected to fraud by the Department of Justice, despite facilitating only 15% of the overall loans.
While these companies and many others are under investigation due to fraudulent PPP lending practices, Small Business Assistance Corporation (SBAC) has been able to fund and successfully receive forgiveness for 99% of its nearly 600 PPP borrowers. Recipients of the PPP loan had 10 months from the end of their covered period to request forgiveness before they needed to begin making payments on the loan. Less than 10 of SBAC’s PPP loan recipients have yet to request full forgiveness. This success rate is made possible through our prudent lending standards that help to ensure businesses are reviewed thoroughly to help eliminate fraudulent loan requests.
In 2020 and 2021, SBAC provided much-needed Paycheck Protection Program (PPP) loans. Our team funded 572 loans for a total of nearly $8 million. The loans supported 294 minority-owned businesses, and 254 women-owned businesses, and retained over 1,400 jobs! Our PPP loans extended into 40 counties in Southeast Georgia and 4 counties in the South Carolina Lowcountry.
SBAC prides itself on integrity and being a trusted source for small business lending. Let us be your go-to lender for any emergency and nonemergency small business financial needs.
If you suspect PPP fraud, you can report it here: https://www.sba.gov/funding-programs/loans/covid-19-relief-options/preventing-fraud-identity-theft.
There is currently a 10-year statute of limitation in place to allow for the investigation and prosecution of individuals who abused the program.
Fintechs Face DOJ, House Scrutiny Over PPP Lending: Financial Services Watch Blog: Insights & Events: Bilzin Sumberg, Financial Services Watch Blog | Insights & Events | Bilzin Sumberg, November 9, 2022
Statement by SBA Administrator Guzman on the Signing of the Paycheck Protection Program and Bank Fraud Enforcement Harmonization Act and the COVID-19 Economic Injury Disaster Loan Fraud Statute of Limitations Act, November 9, 2022