FBI Says No Due Diligence Performed on PPP Loan Applications

PEORIA (Heart of Illinois ABC) — It sounded too good to believe for some who saw an opportunity in the rush to help traders during the pandemic. More than $800 billion has been distributed to businesses in need during the pandemic.

A fraction of that sum is now thought to have gone into fake accounts.

“If you don’t have any kind of checks or checks, people are going to try to steal money,” said David Nanz, special agent in charge of the FBI’s Springfield field office.

With billions of federal dollars doled out through the Small Business Administration, that is exactly what has happened. Nanz says the amount of fraud related to the Payment Protection Program loan is unprecedented.

“No agency, even the FBI, can investigate every single person who has committed this type of crime across the country, so we need our local and state partners,” Nanz said.

A fraction of the $813 billion given to struggling businesses during the pandemic is said to be fraudulent.

Nanz says nearly everyone approved for the loan through the SBA has received one. Most of these loans are now cancelled. He says the problem is that there are no checks and balances in place to ensure candidates had real businesses.

“The SBA was in a rush, if you will, to pull some of that money out and there just wasn’t any due diligence. So many people took advantage of this by lying on their job applications,” Nanz said.

Now the FBI is investigating thousands of people across the country.

“The number of frauds is so large that it will take a few years to get rid of them,” Nanz said.

A few people have been charged locally, in Peoria and McLean County. Nanz says people will get caught eventually.

“The length of the jail term will depend on how many rogue programs they targeted and how much money they stole,” Nanz said.

25 News reached out to local lawmakers to see how they would ensure it didn’t happen again, none responded on the matter.

Dorothy H. Lewis