As the financial market attempts to stabilize during this unprecedented time, the Small Business Administration’s Office of Inspector General is seeing unprecedented levels of potential fraud schemes related to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). The programs offered in this economic stimulus package is the largest financial assistance bill to date and is a major target for fraudulent schemes.

Small business owners and individuals alike should be on alert for grant fraud, loan fraud, and phishing schemes.

Scams and Fraud Schemes

While we encourage any small business in need to pursue the programs being offered by the Small Business Administration, we suggest you reconsider or proceed with caution if:

• You are being contacted by someone claiming to be from the Small Business Administration to initiate a program application. The SBA will not contact your for 7a or Disaster loans or grants.
• You are being contacted by someone promising to get approval of an SBA loan, but requires any payment upfront or offers a high-interest bridge loan in the interim. Grants and loans cannot be guaranteed.
• A broker is attempting to charge more than the set broker fees for SBA loans is fraudulent. SBA limits the fees a broker can charge a borrower to 3% for loans $50,000 or less and2% for loans $50,000-1,000,000 with an additional 1/4% on amounts over $1,000,000.

Phishing Schemes

Phishing is one of the most popular fraudulent practices identity thieves flock to. Watch your inbox for these hints your email could be fraudulent:

• You are applying for an SBA loan and receive an email asking for personally identifiable information (PII), double-check the referenced application number to make sure it is consistent with your application number before providing.
• You receive an email using the SBA logo. These may be attempts to maintain your PII, personal banking access, or to install ransomware/malware on your computer.
• You receive an email communication from the SBA with an email that ends in something OTHER than @sba.gov. 
• The presence of an SBA logo on a web page does not guaranty the information is accurate or endorsed by the SBA. Please cross-reference any information you receive with information available at www.sba.gov

Report Fraud

Report any suspected fraud to OIG’s Hotline at 800-767-0385 or online at, https://www.sba.gov/about-sba/oversight-advocacy/office-inspector-general/office-inspector-general-hotline.

Get Help

If you or your business needs financial assistance through the SBA’s CARES Act, we’re here to help. Visit our COVID-19 Resource Center to review SBA and bank-administered relief programs available through Carter Bank & Trust.