Swansenreport

SBA Chief Loeffler: Biden Officials Ordered Staff to Ignore Treasury’s Fraud Watch List — $14 Billion Went Out Anyway

Small Business Administration chief Kelly Loeffler dropped a bombshell allegation Friday morning: Biden administration officials deliberately ordered SBA employees to bypass the U.S. Treasury Department’s “do not pay” list when processing pandemic-era grants — and a subsequent GAO report found that 70 percent of those grants were flagged as fraudulent.

Loeffler said SBA staff were placed under strict time constraints specifically designed to prevent careful vetting. “They ordered SBA employees to take 4 hours per applicant and not any more,” she said. The rushed processing, she alleged, is how $14 billion in grant money — not loans, but outright grants — “got out the door so quickly.” A subsequent GAO review found that 70 percent of the grants processed under those conditions were fraudulent. FOX6 News Milwaukee

Loeffler, who took over the SBA in February, has been systematically working through the wreckage of pandemic-era fraud since arriving. She described the agency under Biden as having “drifted badly into political waters,” effectively converting lending programs “almost into a grant program” while eliminating basic underwriting standards. She said Biden-era loan policy cost taxpayers $2.2 billion in bad loans during that four-year period alone. Urban Milwaukee

Loeffler said the current SBA has already sent out 1,000 demand letters to recipients of fraudulent grants — individuals and entities who received outright taxpayer checks, not forgivable loans — seeking repayment. “These were the federal government writing checks of taxpayer money,” she said. “We have come in from day one with a zero-tolerance policy on fraud.” FOX6 News Milwaukee

The broader scope of what Loeffler has been uncovering is staggering. In February, the SBA suspended 111,620 California borrowers tied to $8.6 billion in suspected PPP and EIDL fraud. In January, the agency suspended nearly 7,000 Minnesota borrowers connected to roughly $400 million in potentially fraudulent pandemic loans — with Loeffler telling Gov. Walz directly that $430 million in PPP funds flagged as potentially fraudulent were funded anyway, and some were forgiven, during the Biden administration. Racine County Eye

For Swansenreport readers who have been following the Minnesota fraud thread — Feeding Our Future, the Walz whistleblower testimony, the blocked Ilhan Omar subpoena, the Medicaid freezes — Loeffler’s allegations add a new dimension: it wasn’t just that Biden officials failed to catch the fraud. According to the SBA administrator, they were actively told to look the other way.

Sources: MEAWW | Daily Caller News Foundation | Fox News — California | Fox News — Minnesota | SBA Official Press Release