Chairman Williams: “Stolen Taxpayer Funds: Reviewing the SBA and OIG Reports of Fraud in Pandemic Lending Programs”
Reviewing the SBA and OIG Reports of Fraud in Pandemic Lending Programs
Washington, July 13, 2023
WASHINGTON, D.C. – Today, the House Committee on Small Business is holding a full committee hearing titled “Stolen Taxpayer Funds: Reviewing the SBA and OIG Reports of Fraud in Pandemic Lending Programs.”
Chairman Roger Williams’ opening statement as prepared for delivery:
Good afternoon and welcome to today’s hearing which will focus on two recent reports examining fraud in the COVID-19 pandemic lending programs. These contradicting reports, one from the SBA’s Office of Inspector General and the other from the Small Business Administration, were released within hours of one another on June 27th.
The SBA Inspector General report concluded the SBA disbursed more than $200 billion in potentially fraudulent loans through pandemic relief programs, while the SBA reported the fraud in these programs is closer to $36 billion. This egregiously large discrepancy, more than $160 billion, demands answers.
Given the drastically different figures in these reports, and the lack of an adequate plan to recoup these stolen taxpayer funds, we invited SBA Administrator Guzman to join us here today. But as you can see by her empty seat, she declined the offer. You would think that a report from a non-partisan watchdog claiming hundreds of billions of dollars were disbursed to criminals through the SBA would warrant her showing up to this Committee today, but that obviously isn’t the case for Administrator Guzman.
During the pandemic, the SBA oversaw an unprecedented amount of lending. While there was an understanding that getting money out quickly could lead to higher levels of fraud, nothing of this magnitude was imagined. The OIG report estimates that roughly 1 in 5 loans disbursed through the pandemic programs have been labeled as potentially fraudulent. This after-action report shows the SBA was not up to the task when the American people needed their help the most, and we must have this track record in the back of our minds as the Agency looks to take on additional responsibilities.
The American people need accountability and transparency. If a small business’s accounts receivables were as high as the SBA’s, they would take all actions possible to get this money back. Unfortunately, it does not appear that the SBA is taking every action possible to get these stolen funds back for the taxpayers. We cannot sweep this under the rug and write off all this fraud as a loss for the taxpayers.
Inspector General Ware, thank you for taking the time to join us today, and we look forward to your examination of these reports and their discrepancies. We understand the failures within the SBA are independent of you and your office, but on behalf of Main Street America, it is our responsibility to hear about your findings and work toward a solution to combat fraud moving forward.
We must obtain a better understanding of what went wrong, how to fix these issues, and what we can do to recover these stolen taxpayer dollars. We stand ready to work to ensure the SBA has the oversight metrics in place to fairly report their past mistakes and, hopefully, to restore integrity in the agency.
With that, I will yield to our distinguished Ranking Member from New York, Ms. Velázquez.