Small Business Lending Fraud Prevention Act

Floor Speech

Mr. Speaker, I rise in support of the Small Business Lending Fraud Prevention Act.

Let me begin by commending Representatives Meuser and Goodlander for their bipartisan work on this bill, which would enhance SBA's internal processes to further detect fraud.

As the chairman mentioned, recently an SBA loan officer pled guilty to making false statements after approving more than $550,000 in fraudulent COVID-19 pandemic loans for herself and for family members.

The previous administration identified the wrongdoing, terminated the employee, and referred the case to the Office of Inspector General. This proves that the process worked. However, requiring loan officers to attest that they are not violating any conflict of interest laws or regulations every time they originate, review, or approve a loan is a simple step that further reinforces ethical standards and reminds them that misconduct has consequences. Implementing this practice will help to increase accountability, strengthen compliance, and deter fraud.

Mr. Speaker, I am pleased to support this bipartisan bill, and I reserve the balance of my time.

Mr. Speaker, in closing, this committee has played an integral role in conducting oversight of SBA programs, especially the pandemic relief programs. Approximately $1.2 trillion of economic aid was distributed through SBA's pandemic relief programs over the course of the pandemic, providing economic relief to small businesses all over the country.

Unfortunately, bad actors took advantage of the programs, and it has become clear that we need to work together to recover fraudulent dollars. The previous administration took strong steps to root out fraud and to put internal controls in place to prevent it, and the Inspector General has been working diligently to uncover fraudulent schemes.

The bottom line is that the current process worked. The bad actor at the SBA was identified, investigated, and prosecuted. Moving forward, SBA employees being required to certify there is no conflict of interest before approving a loan provides an extra layer of security which will help deter fraud.

Once again, I applaud Representatives Goodlander and Meuser for working together on this bill that enhances conflict of interest laws at SBA and provides even more accountability.

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