According to the New York Times, the Small Business Administrationβs pandemic-era relief program fell victim to massive amounts of fraud.
The $20 billion program, which offered emergency grants to small businesses, reportedly paid out $4.5 billion in fraudulent claims in spring of 2020.
700,000 self-employed people are said to have submitted improper claims.
Hannibal Ware, the SBAβs inspector general, said in a report that the fraud prevention tools in the software were so poorly executed, they failed to flag βflawed or illogical information.β
Wareβs recent report cited 15 applicants who claimed to have a million employees, contentions the SBA program never attempted to verify.
Typically, the SBA program would not apply to businesses with 500 or more employees, yet grants were awarded to hundreds of applicants who claimed such.
By Wareβs calculation, said the NYT, applicants suspected of fraud βwere eligible for only $704 million of the $5.2 billion they received.β
Ware has recommended that the government try to reclaim the agencyβs overpayments.