SBA Warns Small Businesses of Fraudulent Attempts Offering to Help Them Secure SBA Loans
WASHINGTON - The U.S. Small Business Administration (SBA) is warning
small businesses to use caution if they are contacted by firms offering
to help them apply for funds available through SBA programs.
SBA and SBA's Office of the Inspector General (SBA OIG) have received
several complaints from small businesses about abusive marketing
practices, scams, and exorbitant fees charged by firms offering to help
them obtain a loan, grant, or other federal funds, from SBA.
Some of these complaints include:
* Firms charging small businesses high fees to provide assistance
applying to SBA funding programs. Some firms allegedly guaranteed that
the small business would obtain SBA funding if they paid the fee. SBA
does not endorse or give preference to specific private companies or
* Firms charging small businesses for services never requested
after the small business gave bank account and routing information to a
caller claiming to be a firm offering assistance. SBA recommends that
small businesses never provide social security numbers, bank account
information, or credit card numbers to anyone; and, never over the
* Firms alleging that a small business would be issued a
"forfeiture letter" that would make the small business ineligible for
any SBA funding for three years if the small business refused to use the
When electing to use a third party to apply for SBA funding programs,
small businesses should also bear in mind:
* Small businesses can get free assistance in person or by calling
one of SBA's 68 District Offices and from information on SBA's Web site
(www.sba.gov). They can also get assistance from Small Business
Development Centers, Women's Business Centers, Veterans Business
Outreach Centers and SCORE Chapters, either free or for a reasonable
fee. Location and contact information for the centers can be found on
SBA's Web site.
* Small businesses should ask for references and confer with
trusted colleagues and institutions, such as the Better Business Bureau,
when selecting service providers.
* Small businesses should clearly establish and document: 1) What
they are being charged; 2) When they will be charged; 3) What they must
do; and 4) What services they will receive.
SBA's Office of the Inspector General will investigate and respond to
all complaints. SBA encourages anyone with knowledge of a
misrepresentation regarding SBA Business Loan Programs, or any other SBA
program, to contact SBA OIG by calling the OIG Hotline toll-free at
(800) 767-0385, or submitting an online report at the SBA OIG Web page (
www.sba.gov/ig <http://www.sba.gov/ig> ), and click the link for "Report
Fraud Waste or Abuse."
Anyone who has a question regarding an SBA loan or any SBA program, may
contact their local SBA District Office
<http://www.sba.gov/localresources/district/index.html> , the SBA Answer
Desk <http://www.sba.gov/contactus/index.html> at 1-800-U-ASK-SBA
(1-800-827-5722) or e-mail firstname.lastname@example.org.