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Justice News

Department of Justice
U.S. Attorney’s Office
Western District of Kentucky

FOR IMMEDIATE RELEASE
Friday, April 24, 2020

Warning: Potential Fraud Scams Surrounding SBA Loans

LOUISVILLE, Ky. – The United States Attorney’s Office, the Federal Bureau of Investigation, and the U.S. Small Business Administration warns Kentuckians to be alert about possible scams relating to the CARES Act. SBA’s Office of Inspector General has published a list of possible scams and fraud schemes to raise public awareness:  https://www.sba.gov/document/report--sba-programs-scams-fraud-alerts.

U.S. Attorney Russell Coleman, Robert Brown, Special Agent in Charge of the FBI Louisville Field Office, SBA OIG Eastern Region Special Agent-in-Charge Kevin Kupperbusch and Robert Coffey, SBA Kentucky Acting District Director, made the announcement today in an effort to prevent those in need from being victimized a second time by criminals using the program as an opportunity to commit fraud.

“Every dollar that these thieves steal is a dollar that’s not putting someone back to work or that’s failing to assist small businesses rebuild,” said U.S. Attorney Russell Coleman. “We will do our job in law enforcement but urge small business owners to use an abundance of caution to avoid becoming a victim.” 

“Those seeking to profit from the uncertainty surrounding the COVID-19 pandemic will continue to exploit the opportunities presented to them,” said Robert Brown, Special Agent in Charge of the FBI Louisville Field Office. “As we have witnessed with other types of COVID-19 related fraud, criminals are attempting to prey upon entities during their time of fear and anxiety. The FBI along with our partners are working every day to keep Americans safe during this unprecedented time.” 

 “Fraudsters prey upon those in vulnerable positions, and this is a critical time for our nation’s small businesses,” said SBA OIG’s Eastern Region Special Agent-in-Charge Kevin Kupperbusch.  “SBA OIG and its law enforcement partners are actively working together to root out fraud in SBA’s programs and bring those responsible to justice.  The public is encouraged to learn about potential fraud schemes and scams as a safeguard to being victimized.”

When the CARES Act was signed into law, the doors were opened for small businesses to access $349 billion in federal aid at a most crucial time for entrepreneurs that are balancing the health and safety of their families and themselves while operating their small business.  Not only did small businesses take note of the U.S. Small Business Administration’s Economic Injury Disaster Loan (EIDL) and the Paycheck Protection Program (PPP), but, unfortunately, so did those with bad intentions

“With so much money involved, it is little wonder that hackers and others sought ways to defraud these desperate businesses at a most critical time,” said Robert Coffey, SBA Kentucky Acting District Director. “Entrepreneurs must be on guard against these attempts.  The best defense is to exercise your business acumen when presented with offers, for example, if someone approaches you to help you get your funding faster by giving your bank account information.”

Entrepreneurs should remember that if anyone asks you for money, they are not legitimate, nor are emails that end in anything but “.gov”.  Even if someone has some details about your loan request, do not fill in the blanks by providing information that you have already provided through the application process. A confidential, legitimate source has this information already. SBA does not reach out to initiate a loan.

If you have any doubt, please don’t hesitate to reach out to your nearest SBA office to ask. As you are working harder than ever to preserve your business and its employees amid the Coronavirus pandemic, do not allow bad actors to hinder your efforts. 

If you have questions, please refer to the official SBA website where most of your questions can be answered.  The address is: www.sba.gov and stay up to date on the most current information by following Kentucky SBA  on Twitter @SBA_Kentucky.

You are encouraged to report fraud, waste, abuse, mismanagement, or misconduct involving SBA programs to the SBA OIG hotline at (800) 767-0385, or online at: https://sbax.sba.gov/oigcss/.

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Updated April 24, 2020