The Small Business Administration Didn’t Follow Directives on Small-Business Credits—Inspector General

1127
SHARE
The Small Business Administration failed to follow directives on money given temporarily for small businesses, the SBA inspector general said. (photo credit: SBA)

The Small Business Administration failed to adhere to many orders from Congress in carrying out its immense loan plan that is supposed to preserve businesses over the course of COVID-19. That includes not putting forth direction to make underserved societies a top concern, the SBA’s inspector general reported, according to The Wall Street Journal.

The inspector general hones in on the Paycheck Protection Program—a large portion of a $2 trillion assistance bill that in March became statute—and how efficiently the SBA followed the statute’s directives.

The inspector general took note that Congress mandated the agency to provide directives to bestowers about markets that are underserved and in the country. However, the SBA didn’t do that. Consequently, debtors “including rural, minority and women-owned businesses may not have received the loans as intended,” the inspector general reported.

It also learned that the agency put forth standards that mandated that debtors utilize 75% of the capital on salaries to get the entire clemency of their credit, despite the CARES Act Congress passed not requiring any particular quantity be committed for salaries.