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Avoid Loan Fraudsters During COVID-19 Crisis

4/13/2020

If you are a small business that has applied for an Economic Injury Disaster Loan (EIDL) or any other SBA loans, beware of potential threats via grant fraud, loan fraud, and phishing schemes.

As the world faces unprecedented times due to the coronavirus pandemic (COVID-19), fraud that may affect you and your business is on the rise. Please read the following information to ensure you are taking proper precautions to protect yourself from potential fraud related to economic stimulus programs offered by the Small Business Administration (SBA).

Grant and Loan Fraud

What to Know:

  • The SBA will not initiate contact on either 7(a) or Disaster loans and grants.
  • The SBA Disaster loans do not require any upfront payment to get approval.
  • Suspect fraud if the person contacting you tries to offer a high-interest bridge loan in the interim.
  • The SBA also limits the fees a broker can charge to borrowers (3% for loans $50,000 or less, and 2% for loans $50,000–1,000,000 with an additional 0.25% for loans over $1,000,000).

Prevention Tactic: Use your best judgment before divulging any personal or business information to another person. Contact the SBA directly if you have a specific question about getting a SBA disaster loan by calling 800.659.2955 or emailing [email protected].

Read about our COVID-19 repsonse udpates at ppbi.com/readiness.

The information expressed is being provided for informational and educational purposes only. It is not intended to provide specific advice or recommendations for any individual or business.

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