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FIRST ON FOX: A top “DOGE” senator said a government watchdog alerted her to an “alarming” rate of COVID-era “PPP” loan defaults, and now wants scammers be responsible
In a letter to Sen. Joni ErnstInspector General for Pandemic Recovery (SIGPR) Brian Miller, R-Iowa, wrote that funding for the loan programs posted losses of $1.27 billion in November 2024 and had increased since payments initial notes of the debtors began to mature in July 2023.
“Without SIGPR to protect the taxpayer, there will be no one to allow this crisis to continue,” Miller wrote.
“Of equal concern is an alarming rate of defaults by borrowers who fail to make even interest payments on loans from the Main Street Lending Program (MSLP) and the Direct Lending Program.”
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A page from the PPP loan application for financial support due to the outbreak of COVID-19 in New York. May 7, 2020. (REUTERS/Lucas Jackson)
The inspector general added that his office has been “cutting staff” and going through legally required processes for an agency in the process of being closed.
There are at least 130 potential defendants identified to be investigated, and without adequate resources, they may never be.
Ernst warned that dishonest loan applicants could get away with $200 billion in fraud COVID-19 relief if your bill doesn’t go through.
Sen. Joni Ernst, R-Iowa, has authored legislation that would provide additional resources to hold fraudsters accountable for the coronavirus pandemic. (Reuters/Bonnie Cash)
“Scammers took advantage of small business pain during COVID to defraud government programs designed to help hardworking Americans,” Ernst said Wednesday.
“While we are $36 trillion in debt, we most importantly cannot afford to leave more than $200 billion floating around, especially in the hands of fraudsters. My Republican colleagues and I will ensure that all resources are available in this fight to get taxpayers’ money back and hold these criminals accountable.”
When the Small Business Administration started the Restaurant Revitalization Fund and Paycheck Protection Program (PPP) loans, they were on a first-come, first-served basis.
Critics claimed at the time that many qualifying businesses and entities were turned away, and reports proliferated that gang members and drug traffickers could access the resources.
An alleged con artist used a photo of a Barbie doll as ID on an SBA loan application, while another bilked off $8 million that could have gone to struggling restaurants, especially in states with policies onerous closures.
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In response, Ernst has drafted the Comprehensive COVID Collections Act, Fox News Digital has learned.
The bill would extend SIGPR’s authorization through 2030 and expand its jurisdiction to cover other SBA COVID-related programs. As of Wednesday, the SIGPR is only authorized through September.
The proposal also directs the Treasury to enforce the collection of loans of less than $100,000 as rigorously as it does suspected dollar scofflaws and late borrowers.
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It also provides the Department of Justicerequiring the law enforcement agency to provide periodic reports to Congress on activities related to pandemic-focused programs, such as prosecutions, recovery of funds, and referrals to the DOJ of other entities.
By Wednesday afternoon, Ernst’s bill was co-sponsored by four other Republicans: Sens. Marsha Blackburn of Tennessee, Todd Young of Indiana, James Lankford of Oklahoma and John Curtis of Utah, who had just sit down after Mitt Romney’s departure.
