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The health emergency due to the coronavirus remains in force. Photo: Pixabay.

SBA announces measures to prevent fraud in pandemic programs

The SBA has set out to recover the funds intended to combat the COVID-19 pandemic and that have been used fraudulently.


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Through the appointment of a special advisor, who will supervise the implemented fraud control strategies, the Small Business Administration (SBA) has proposed to make greater efforts to prevent fraud cases and recover the resources used illegally, especially in the programs destined to provide aid to deal with COVID-19.

Isabella Casillas Guzmán, head of the SBA, also announced the start of “an all-hands-on-deck, multi-faceted expansion of efforts to identify and support the SBA Inspector General’s recovery of fraudulently obtained COVID economic relief funds and to prevent potential future theft of taxpayer dollars.”

Taking into account that a fundamental part of the functions of the SBA consists of managing the risk of fraud in the entity's programs, the Administration's new multi-pronged approach seeks to limit the actors that try to misuse the resources of the taxpayers or those who do not adequately provide their services to the public.

“The SBA’s work in the Biden-Harris Administration to enhance fraud controls in pandemic programs has been recognized by federal accountability agencies and watchdogs. These new efforts will expand that work as SBA continues to undertake measures to ensure the integrity of its programs,” it is pointed out from the Administration.

New Measures

A new package of measures was announced by the SBA to successfully advance its anti-fraud campaign.

  • Peggy Delinois was appointed as SBA's Special Counsel for Enterprise Risk to advise Administrator Casillas Guzmán on risk management and fraud activities throughout the institution.
  • It was announced the creation of the SBA’s Fraud Risk Management Board (FRMB) to provide oversight and coordination against fraud.
  • Fraudulent incidents will be tackled through the inter-institutional working group for fraud control, which has the support of the Chief Prosecutor of the pandemic and director of the Department of Justice for the control of fraud by COVID-19.

In addition to quickly rooting out scams targeting government programs, the measures are also intended to increase fairness throughout their processes, thus seeking to ensure that small business owners have access to the capital and necessary resources to make their business prosper.

“Throughout the first year of the Biden-Harris Administration, the SBA has taken important steps to close the door on fraud, waste, and abuse and ensure billions of dollars in taxpayer-funded COVID relief make it into the hands of small business owners,” said Casillas Guzmán.

Special Counsel

During the presentation of the new Special Counsel for Enterprise Risk, who will advise the Administration on risk management activities throughout the company and will directly support Casillas Guzmán in the development of strategies to mitigate dynamic risks in potential exposure to fraud, as well as the development of plans to reduce risks in the SBA's operations, it was highlighted how she will provide strategic information on the potential risks of the entire company that have a clear impact on small businesses owners.

Leveraging Delinois's extensive banking regulatory experience and understanding of Agency priorities, the SBA hopes to gain strategic insight to address the potential risks facing the Administration's most important programs.

“The steps we are announcing today build on that work under the capable watch of Peggy Delinois Hamilton, as our new SBA Special Counsel for Enterprise Risk, and the newly created Fraud Risk Management Board, in coordination with the SBA’s Office of Inspector General and the Department of Justice’s Chief Pandemic Prosecutor. Together, we will hold fraudsters accountable and shut down future pathways to fraud,” highlighted Casillas Guzmán. 


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