COVID Fraud Transparency Act of 2026
- Issuer
- U.S. House Committee on Small Business
- Document type
- Committee report
- Date
- 2026-06-03
Committee report — COVID Fraud Transparency Act of 2026, dated 2026-06-03, issued by U.S. House Committee on Small Business.
Full text
119TH CONGRESS REPORT
" HOUSE OF REPRESENTATIVES !
2d Session 119–677
COVID FRAUD TRANSPARENCY ACT OF 2026
JUNE 3, 2026.—Committed to the Committee of the Whole House on the State of
the Union and ordered to be printed
Mr. WILLIAMS of Texas, from the Committee on Small Business,
submitted the following
R E P O R T
together with
MINORITY VIEWS
[To accompany H.R. 826]
The Committee on Small Business, to whom was referred the bill
(H.R. 826) to require the Inspector General of the Small Business
Administration to submit a quarterly report on fraud relating to
certain COVID–19 loans, having considered the same, reports fa-
vorably thereon with an amendment and recommends that the bill
as amended do pass.
CONTENTS
Page
I. Purpose and Bill Summary ........................................................................... 2
II. Need for Legislation ...................................................................................... 2
III. Hearings ......................................................................................................... 2
IV. Committee Consideration .............................................................................. 3
V. Committee Votes ............................................................................................ 3
VI. Section-by-Section of H.R. 826 ...................................................................... 5
VII. Congressional Budget Office Cost Estimate ................................................ 5
VIII. New Budget Authority, Entitlement Authority, and Tax Expenditures 5
IX. Oversight Findings & Recommendations .................................................... 5
X. Performance Goals and Objectives ............................................................... 6
XI. Statement of Duplication of Federal Programs ........................................... 6
XII. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff Ben-
efits .............................................................................................................. 6
XIII. Federal Mandates Statement ....................................................................... 6
XIV. Federal Advisory Committee Statement ...................................................... 6
XV. Applicability to Legislative Branch .............................................................. 6
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XVI. Statement of Constitutional Authority ........................................................ 6
VII. Minority Views ............................................................................................... 7
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The amendment is as follows:
Strike all after the enacting clause and insert the following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘COVID Fraud Transparency Act of 2026’’.
SEC. 2. REPORT ON FRAUD RELATING TO CERTAIN COVID–19 LOANS.
(a) IN GENERAL.—Not later than 60 days after the date of the enactment of this
Act, and every 3 months thereafter, the Inspector General of the Small Business Ad-
ministration shall submit to the Committee on Small Business of the House of Rep-
resentatives and the Committee on Small Business and Entrepreneurship of the
Senate a report on the number of borrowers engaged in fraud with respect to a cov-
ered loan.
(b) ELEMENTS.—The report required under subsection (a) shall include, with re-
spect to the period covered by such report—
(1) the number and total dollar amount of all covered loans made;
(2) the number of new cases of fraud and suspected fraud;
(3) the number of fraud cases resolved; and
(4) the types of fraud cases described in paragraphs (2) and (3).
(c) COVERED LOAN DEFINED.—In this section, the term ‘‘covered loan’’ means—
(1) a loan made under paragraph (36) or (37) of section 7(a) of the Small Busi-
ness Act (15 U.S.C. 636(a)); or
(2) a loan made under section 7(b) of such Act (15 U.S.C. 636(b)) in response
to COVID–19 during the covered period (as defined in section 1110(a) of the
CARES Act (15 U.S.C. 9009)).
(d) TERMINATION.—This Act and the requirements of this Act shall terminate on
the date that is two years after the date of the enactment of this Act.
SEC. 3. COMPLIANCE WITH CUTGO.
No additional amounts are authorized to carry out this Act.
I. PURPOSE AND BILL SUMMARY
On January 28, 2025, Chairman Roger Williams (R–TX), Rep.
George Latimer (D–NY), Rep. Aaron Bean (R–FL), and Rep. Kweisi
Mfume (D–MD), introduced H.R. 826, the COVID Fraud Trans-
parency Act of 2025. H.R. 826 requires the U.S. Small Business Ad-
ministration (SBA) Office of Inspector General (OIG) to regularly
report to Congress on fraud relating to COVID-era SBA loans such
as Paycheck Protection Program loans and COVID–19 Economic
Injury Disaster Loans (EIDL).
II. NEED FOR LEGISLATION
H.R. 826 requires the SBA OIG to submit quarterly reports to
Congress on fraud relating to PPP loans and COVID-EIDL. The re-
port must include number of loans made, the amount of money in-
volved, and the number of fraud cases identified and resolved. It
establishes a recurring quarterly reporting schedule and limits the
requirements to a two-year period, using existing government re-
sources rather than new funding.
According to the SBA OIG White Paper Report 23–09, COVID–
19 Pandemic EIDL and PPP Loan Fraud Landscape, an estimated
$200 billion in potentially fraudulent COVID–19 EIDLs and PPP
loans were disbursed by the SBA. As the OIG continues to work
on the tens of thousands of investigative leads into alleged fraud,
waste, and abuse of taxpayer resources, Congress needs to be kept
apprised of the extent of the fraud and the progress in resolving
ongoing cases.
III. HEARINGS
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The Committee on Small Business held the following hearings
examining matters related to H.R. 826:
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• On February 5, 2025, the Committee held a hearing titled
‘‘Hope on the Horizon: Prioritizing Small Business Growth in
the 119th Congress.’’
• On December 16, 2025, the Committee held a hearing ti-
tled ‘‘American Resilience: Examining the SBA Disaster Assist-
ance Program.’’
IV. COMMITTEE CONSIDERATION
The Committee on Small Business met in open session, with a
quorum being present, on May 20, 2026, and ordered H.R. 826, as
amended, to be reported favorably to the House of Representatives
by a roll call vote of 23 ayes to 0 nos.
V. COMMITTEE VOTES
Clause 3(b) of rule XIII of the Rules of the House of Representa-
tives requires the Committee to list the recorded votes on the mo-
tion to report legislation and amendments thereto. The Committee
voted to favorably report H.R. 826, as amended, to the House of
Representatives at 4:12 PM.
The Committee considered the follow amendments to H.R. 826:
• Chairman Williams offered an amendment in the nature of
a substitute to H.R. 826. This amendment was adopted by
voice vote.
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VI. SECTION-BY-SECTION OF H.R. 826
Section 1—Short title
This Act may be cited as the ‘‘COVID Fraud Transparency Act
2026.’’
Section 2—Report on fraud relating to certain COVID–19 loans
This section requires the SBA Inspector General to submit a re-
port within 60 days of enactment and every three months after-
ward on fraud involving COVID-related SBA loans.
This section also specifies that the report must include the total
number and dollar amount of covered loans, new and resolved
fraud cases, and the types of fraud identified. This section defines
‘‘covered loans’’ as certain Paycheck Protection Program (PPP)
loans and Economic Injury Disaster Loans (EIDL).
This section also ends the reporting requirement two years after
the law is enacted.
Section 3—Compliance with CUTGO
This section states that no additional federal funding is author-
ized to implement the Act and that the requirements must be car-
ried out using existing resources.
VII. CONGRESSIONAL BUDGET OFFICE COST ESTIMATE
Pursuant to 3(c)(3) of rule XIII of the Rules of the House of Rep-
resentatives, the Committee adopts as its own the cost estimate
prepared by the Director of the Congressional Budget Office pursu-
ant to section 402 of the Congressional Budget Act of 1974. At the
time this report was filed, the Committee has requested but not re-
ceived a cost estimate from the Director of the Congressional Budg-
et Office.
VIII. NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX
EXPENDITURES
Pursuant to clause 3(c)(2) of rule XIII of the Rules of the House
of Representatives and section 308(a)(I) of the Congressional Budg-
et Act of 1974, the Committee provides the following opinion and
estimate with respect to new budget authority, entitlement author-
ity, and tax expenditures. While the Committee has not received an
estimate of new budget authority contained in the cost estimate
prepared by the Director of the Congressional Budget Office pursu-
ant to section 402 of the Congressional Budget Act of 1974, the
Committee does not believe that there will be any new or increased
costs attributable to this legislation.
IX. OVERSIGHT FINDINGS & RECOMMENDATIONS
In accordance with clause 3(c)(1) of rule XIII and clause 2(b)(1)
of rule X of the Rules of the House of Representatives, the over-
sight findings and recommendations of the Committee on Small
Business with respect to the subject matter contained in H.R. 826,
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as amended, are incorporated into the descriptive portions of this
report.
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X. PERFORMANCE GOALS AND OBJECTIVES
With respect to the requirements of clause 3(c)(4) of rule XIII of
the Rules of the House of Representatives, the goal of H.R. 826, as
amended, is to improve transparency and congressional oversight of
fraud involving COVID-era SBA loans.
XI. STATEMENT OF DUPLICATION OF FEDERAL PROGRAMS
Pursuant to clause 3(c)(5) of rule XIII of the Rules of the House
of Representatives, no provision of H.R. 826, as amended, is known
to be duplicative of another Federal program, including any pro-
gram that was included in a report to Congress pursuant to section
21 of Public Law 111–139 or the most recent Catalog of Federal
Domestic Assistance.
XII. CONGRESSIONAL EARMARKS, LIMITED TAX BENEFITS, AND LIMITED
TARIFF BENEFITS
With respect to clause 9 of rule XXI of the Rules of the House
of Representatives, the Committee finds that the bill does not con-
tain any congressional earmarks, limited tax benefits, or limited
tariff benefits as defined in clause 9(e), 9(f), or 9(g) of rule XXI of
the Rules of the House of Representatives.
XIII. FEDERAL MANDATES STATEMENT
The Committee will adopt as its own the estimate of the Federal
mandates prepared by the Director of the Congressional Budget Of-
fice pursuant to section 423 of the Unfunded Mandates Reform Act.
XIV. FEDERAL ADVISORY COMMITTEE STATEMENT
No advisory committees within the meaning of section 5(b) of the
Federal Advisory Committee Act were created by this legislation.
XV. APPLICABILITY TO LEGISLATIVE BRANCH
The Committee finds that the legislation does not relate to the
terms and conditions of employment or access to public services or
accommodations within the meaning of section 102(b)(3) of the Con-
gressional Accountability Act.
XVI. STATEMENT OF CONSTITUTIONAL AUTHORITY
Pursuant to clause 7 of rule XII of the Rules of the House, the
Committee finds that the authority for this legislation in Art. I, § 8,
cl.1 of the Constitution of the United States.
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XVII. MINORITY VIEWS
Over the course of the COVID–19 pandemic, the U.S. Small
Business Administration (SBA) disbursed approximately $1.2 tril-
lion of COVID–19 Economic Injury Disaster Loan (EIDL) and Pay-
check Protection Program (PPP) funds to help small businesses ad-
versely impacted by the crisis.1 In an effort to disburse PPP and
COVID–19 EIDL funds swiftly, the SBA weakened and removed in-
ternal controls. Beginning in early 2021, long-standing anti-fraud
controls were reinstituted and new safeguards were put into place
by the Biden-Harris Administration to reduce the potential for
fraud.2 On June 27, 2023, the SBA Office of Inspector General
(OIG) issued a white paper reporting that the SBA disbursed more
than $200 billion in potentially fraudulent pandemic relief.3 The
SBA also issued a report, entitled ‘‘Protecting the Integrity of the
Pandemic Relief Programs,’’ which estimates that $36 billion of the
$1.2 trillion in pandemic relief was obtained fraudulently.4 The
SBA report asserted that 86% of the likely fraud occurred in the
first nine months of the pandemic,5 under the Trump Administra-
tion.
As fraudsters increasingly exploited the weakened controls at the
SBA and the complexity of the schemes grew, the OIG coordinated
with multiple agencies. The OIG participated in the U.S. Depart-
ment of Justice (DOJ)’s COVID–19 Fraud Strike Force Teams and
has 494 open investigations, as of February 28, 2026. Their work
has resulted in 1,860 indictments, 1,404 arrests, and 1,209 convic-
tions, with $1.3 billion in restitution ordered, and $1.2 billion in as-
sets seized or forfeited.6
The OIG’s ability to further combat fraud is highly dependent on
the availability of budgetary resources. The Administration’s FY
2027 budget provided $33.3 million, a reduction of $3.7 million for
the OIG. It is important that the OIG have a sufficient operating
budget to capitalize on two laws (P.L. 117–165 and P.L. 117–166),
which extended the statute of limitations for fraud in the PPP and
EIDL programs to 10 years, as well as H.R. 4495, the SBA Fraud
Enforcement Extension Act, which would extend the statute of limi-
tations for the Shuttered Venues Operating Grants and the Res-
1 OFF. OF INSPECTOR GEN., U.S. SMALL BUS. ADMIN., REPORT 25–10, COVID–19 PANDEMIC
EIDL AND PPP LOAN FRAUD LANDSCAPE, RECOMMENDATIONS UPDATE (Mar. 31, 2025).
2 OFF. OF INSPECTOR GEN., U.S. SMALL BUS. ADMIN., REPORT 23–09, COVID–19 PANDEMIC
EIDL AND PPP LOAN FRAUD LANDSCAPE (2023).
3 Id.
4 U.S. SMALL BUS. ADMIN., PROTECTING THE INTEGRITY OF THE PANDEMIC RELIEF EMERGENCY
PROGRAMS: SBA’S ACTIONS TO PREVENT, DETECT, AND ADDRESS FRAUD (Jun. 27, 2023).
5 Id.
6 Off. of Inspector Gen., U.S. Small Bus. Admin., SBA OIG Congressional Newsletter (Feb.
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2025).
(7)
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taurant Revitalization Fund. The legislation to require quarterly
reporting will provide the Committee with additional data.
NYDIA M. VELÁZQUEZ,
Ranking Member.
Æ
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