The U.S. government will introduce new “robust safeguards” to the third round of the country’s main small business pandemic aid program after fraudsters and ineligible companies claimed cash last year, administration officials said on Friday.
The Small Business Administration (SBA) will kick off the third round of the Paycheck Protection Program (PPP) on Monday, opening initially to community financial institutions and all lenders shortly thereafter, the officials said during a media briefing.
In contrast to the program’s previous two rounds during which loan applications were automatically approved upon submission, the SBA will vet the initial information, slightly slowing approvals. That process will involve running automated identity and data verification checks overnight, the officials said.
The new safeguards were first reported by Reuters earlier on Friday, citing two sources familiar with the process.
The PPP, made by Congress to help private companies hurt by Covid pandemic lockdowns keep staff on payrolls, empowered taking an interest banks to dole out $525 billion worth of credits during two adjusts a year ago.
Government guard dogs and legislative specialists have cautioned that the program has pulled in fraudsters, while numerous huge and recorded organizations, just as boycotted organizations, gamed the program’s principles to take money.
The Department of Justice, working with different offices, has charged in excess of 80 people with taking more than $250 million from the program. The sources said the SBA will be more cautious in favoring advance applications this time.
“They won’t let everything through,” one source said.
A senior SBA official declined to remark on the cycle changes however said “exercises learned” from the past rounds were being executed.
With the last year changing how (and where) many of us work, organizations have started to…