The House Select Subcommittee on the Coronavirus Crisis released a report Tuesday detailing its analysis of the Paycheck Protection Program's loans for small businesses. The program did help "millions of small businesses" survive the COVID-19 pandemic, but also likely saw "billions of dollars being diverted to fraud, waste, and abuse" due to a "lack of oversight and accountability," the committee found.
More than 11,000 loans totaling more than $3 billion raised "red flags" for the subcommittee, it said in its report. These issues included addresses on PPP loan applications that didn't match those used in the federal government's System for Award Management, which businesses have to register with to do business for the U.S. government, possibly indicating fraud. Another 10,856 loans totaling $1 billion went to companies that got multiple loans, which was against the PPP loan rules. In addition, 613 loans totaling $96 million went to companies that are barred from doing business with the government altogether, while 353 loans totaling $195 million went to government contractors previously flagged for performance or integrity issues, the subcommittee found.
The Treasury Department should've noticed these issues, the subcommittee said. But the department and the Small Business Administration would only audit PPP loans over $2 million, constituting just .6 percent of all the PPP loans they issued. That left "the other 99.4% of loans with little or no oversight," the subcommittee said before going on to suggest ways the department could audit more loans based on the House's findings. Find the whole report here.