Paycheck Protection Program Loan Recipients on the Department of Treasury's Do Not Pay List [open pdf - 567KB]
From the Document: "The Office of Inspector General (OIG) is issuing this Management Alert to bring to your attention serious concerns about improper payments to lenders for potentially ineligible recipients of loans under SBA's [Small Business Administration] Paycheck Protection Program (PPP) in response to the Coronavirus Disease 2019 (COVID-19) pandemic. This issue requires immediate attention and action. Due to complaints of fraud received by the OIG, we collaborated with the U.S. Department of the Treasury (Treasury) Do Not Pay (DNP) Business Center, which identified high-risk transactions related to financial assistance to small businesses for the COVID-19 pandemic. Our review of Treasury's analysis showed approximately $3.6 billion in PPP loans to potentially ineligible recipients. Expedited management action could reduce or prevent the potential for loss in terms of the risk of improper payments to lenders for amounts ineligible for forgiveness as well as any fees. OIG communicated summary results to SBA management, who requested Treasury's results and have systemically put a 'hold' flag on loans identified by the DNP team to ensure the loan applications are properly reviewed before processing for forgiveness or any further disbursements. Additionally, SBA management contacted the DNP Business Center and discussed the matching parameters to ensure that DNP's results were consistent with PPP eligibility provisions. Consequently, DNP's results were revised and are represented in this memorandum."
Small Business Administration, Office of the Inspector General, Report No. 21-06