Review of SBA's Top Management and Performance Challenges in Fiscal Year 2022 and SBA OIG's Semiannual Report to Congress (House Small Business Committee hearing, January 12, 2022)
Summary
The printed record of a House Committee on Small Business hearing, Small Business Committee Document Number 117–042, titled Review of SBA's Top Management and Performance Challenges in Fiscal Year 2022 and SBA OIG's Semiannual Report to Congress, held January 12, 2022 in the 117th Congress. The committee met at 10:00 a.m. in Room 2360 of the Rayburn House Office Building and via Zoom with Chairwoman Nydia Velázquez presiding. Opening statements come from Hon. Nydia Velázquez and Hon. Blaine Luetkemeyer. The single witness is Hannibal Mike Ware, Inspector General of the U.S. Small Business Administration. The appendix lists his prepared statement, questions from five Members with his answers, and additional material from the National Association of Federally-Insured Credit Unions.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Cite this document
“Review of SBA's Top Management and Performance Challenges in Fiscal Year 2022 and SBA OIG's Semiannual Report to Congress (House Small Business Committee hearing, January 12, 2022).”
Original at www.govinfo.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/review-of-sba-s-top-management-and-performance-challenges-in-fiscal-ye-ffa013829e/
, SHA-256 bf985e8d7efffd5053b1159554aae0e17304f3173b13e8058b3a81365639379a.Full text
REVIEW OF SBA’S TOP MANAGEMENT AND
PERFORMANCE CHALLENGES IN FISCAL YEAR
2022 AND SBA OIG’S SEMIANNUAL REPORT
TO CONGRESS
HEARING
BEFORE THE
COMMITTEE ON SMALL BUSINESS
UNITED STATES
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTEENTH CONGRESS
SECOND SESSION
HEARING HELD
JANUARY 12, 2022
Small Business Committee Document Number 117–042
Available via the GPO Website: www.govinfo.gov
U.S. GOVERNMENT PUBLISHING OFFICE
46–712 WASHINGTON : 2022
SBD026 with DISTILLER
Congress.#13
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00001 Fmt 5011 Sfmt 5011 F:\DOCS\46712.TXT DEBBIE
HOUSE COMMITTEE ON SMALL BUSINESS
NYDIA VELÁZQUEZ, New York, Chairwoman
JARED GOLDEN, Maine
JASON CROW, Colorado
SHARICE DAVIDS, Kansas
KWEISI MFUME, Maryland
DEAN PHILLIPS, Minnesota
MARIE NEWMAN, Illinois
CAROLYN BOURDEAUX, Georgia
TROY CARTER, Louisiana
JUDY CHU, California
DWIGHT EVANS, Pennsylvania
ANTONIO DELGADO, New York
CHRISSY HOULAHAN, Pennsylvania
ANDY KIM, New Jersey
ANGIE CRAIG, Minnesota
BLAINE LUETKEMEYER, Missouri, Ranking Member
ROGER WILLIAMS, Texas
JIM HAGEDORN, Minnesota
PETE STAUBER, Minnesota
DAN MEUSER, Pennsylvania
CLAUDIA TENNEY, New York
ANDREW GARBARINO, New York
YOUNG KIM, California
BETH VAN DUYNE, Texas
BYRON DONALDS, Florida
MARIA SALAZAR, Florida
SCOTT FITZGERALD, Wisconsin
MELISSA JUNG, Majority Staff Director
ELLEN HARRINGTON, Majority Deputy Staff Director
DAVID PLANNING, Staff Director
(II)
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00002 Fmt 5904 Sfmt 5904 F:\DOCS\46712.TXT DEBBIE
CONTENTS
OPENING STATEMENTS
Page
Hon. Nydia Velázquez ............................................................................................. 1
Hon. Blaine Luetkemeyer ....................................................................................... 2
WITNESS
Mr. Hannibal ‘‘Mike’’ Ware, Inspector General, Office of the Inspector Gen-
eral, United States Small Business Administration, Washington, DC ........... 4
APPENDIX
Prepared Statement:
Mr. Hannibal ‘‘Mike’’ Ware, Inspector General, Office of the Inspector
General, United States Small Business Administration, Washington,
DC .................................................................................................................. 35
Questions and Answers for the Record:
Questions from Hon. Velázquez and Answers from Mr. Ware ..................... 46
Questions from Hon. Chu and Answers from Mr. Ware ............................... 50
Questions from Hon. Luetkemeyer and Answers from Mr. Ware ................ 51
Questions from Hon. Hagedorn and Answers from Mr. Ware ...................... 61
Questions from Hon. Van Duyne and Answers from Mr. Ware ................... 65
Additional Material for the Record:
NAFCU - National Association of Federally-Insured Credit Unions ........... 68
(III)
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00003 Fmt 5904 Sfmt 0486 F:\DOCS\46712.TXT DEBBIE
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00004 Fmt 5904 Sfmt 0486 F:\DOCS\46712.TXT DEBBIE
REVIEW OF SBA’S TOP MANAGEMENT AND
PERFORMANCE CHALLENGES IN FISCAL
YEAR 2022 AND SBA OIG’S SEMIANNUAL
REPORT TO CONGRESS
WEDNESDAY, JANUARY 12, 2022
HOUSE OF REPRESENTATIVES,
COMMITTEE ON SMALL BUSINESS,
Washington, DC.
The committee met, pursuant to call, at 10:00 a.m., in Room
2360, Rayburn House Office Building and via Zoom, Hon. Nydia
Velázquez [chairwoman of the Committee] presiding.
Present: Representatives Velázquez, Golden, Davids, Mfume,
Phillips, Newman, Bourdeaux, Carter, Chu, Evans, Delgado,
Houlahan, Mr. Kim, Craig, Luetkemeyer, Williams, Stauber,
Meuser, Tenney, Garbarino, Mrs. Young Kim, Van Duyne, Donalds,
and Fitzgerald.
Chairwoman VELÁZQUEZ. Good morning. I call this hearing to
order.
Without objection, the Chair is authorized to declare a recess at
any time.
I would like to begin by noting some important requirements. Let
me begin by saying that standing House and Committee rules and
practice will continue to apply during hybrid proceedings. All Mem-
bers are reminded that they are expected to adhere to these stand-
ing rules including decorum.
House regulations require Members to be visible through a video
connection throughout the proceeding, so please keep your cameras
on. Also, remember to remain muted until you are recognized to
minimize background noise.
In the event a Member encounters technical issues that prevent
them from being recognized for their questioning, I will move to the
next available Member of the same party and I will recognize that
Member at the next appropriate time slot provided they have re-
turned to the proceeding.
For those Members and staff physically present in the Com-
mittee room today, in accordance with the attending physician’s
most recent guidance, all Members and staff who attend this hy-
brid hearing in person will be required to wear masks in the hear-
ing room.
Now I will move to my opening statement.
First, I would like to welcome Inspector General Ware. Thank
you for being here today. Your work has been indispensable
throughout the COVID crisis, and you should be proud of your ef-
(1)
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
2
forts to improve programs critical to small businesses. The IG’s of-
fice is tasked with reporting on the top management and perform-
ance challenges facing the Small Business Administration every
year. While this year’s report covers many longstanding issues, it
also calls attention to the biggest challenge facing the agency, the
pandemic relief programs.
Since 2020, the SBA has distributed nearly $1 trillion in eco-
nomic relief to small firms. This figure surpasses the amount of
money distributed in all other years of SBA’s existence combined.
This is an enormous achievement and helped keep millions of small
businesses afloat during the pandemic. However, with any emer-
gency effort of this magnitude, problems will inevitably occur. Ac-
cording to investigations, the COVID-EIDL and Paycheck Protec-
tion Programs have been vulnerable to fraud. Much of this poten-
tial fraud can be traced back to the early days of the pandemic
when programs were new, loan volume was high, and the need to
get the loans out quickly was the priority.
Your report also notes that in 2020, the previous administration
‘‘relaxed internal controls,’’ adding significant stress to the system
and creating an environment ripe for fraud.
This Committee has worked diligently to conduct oversight and
institute legislative fixes to address these problems. We have con-
ducted hearings, written letters, held briefings, and passed bills,
ensuring money is going to small businesses that need it most and
not the bad actors. Since taking office in January, the Biden ad-
ministration has also demonstrated its commitment to rooting out
fraud and abuse.
Administrator Guzman inherited many open recommendations
from the OIG. Under her leadership, the SBA has closed out 70
OIG recommendations this year alone. SBA took steps to shore up
fraud protections in critical pandemic programs. This includes im-
plementing a master review plan for loan and forgiveness applica-
tions in the PPP program and allowing the agency to hold funds
at any time in the EIDL process.
The agency now also ensures that all borrowers are not on the
Treasury Department’s ‘‘Do Not Pay’’ list. These are just a few of
the actions that help reduce fraud. I look forward to continuing our
work with the administration on this front.
At the same time, the IG’s reports cover other critical issues un-
related to pandemic relief. These include challenges in small busi-
ness contracting, IT security, access to capital, and disaster assist-
ance.
Addressing these problems will require sustained work on a bi-
partisan basis from this committee. I hope that today’s hearing al-
lows us to take a close look at all of these issues and discuss bipar-
tisan solutions to fix them.
I would now like to yield to the Ranking Member, Mr. Luetke-
meyer.
Mr. LUETKEMEYER. Thank you, Madam Chair. And thank you
for calling today’s hearing with Inspector Ware. Welcome, Inspec-
tor. Always good to have you before us to explain what is going on.
Before I begin, I also want to thank the Chairman for the an-
nounced changes in the order in which Members will question the
witnesses. This is an important announcement. I am thankful for
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00006 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
3
your action. Likewise, I know Members will appreciate going back
to regular order and the methods that were voted on within the
rules package.
Additionally, I would like to take this time to recognize and con-
gratulate the Committee’s chief counsel, Jan Oliver, on her upcom-
ing retirement. Jan has been a stalworth for small businesses for
years and has worked in public service for decades. From her time
with now-Senator Portman to working at the White House and to
her time and her services committee, her steady guidance and
counsel for the past 31 years has always been welcomed by the sev-
eral Chairmen and many Committee Members that she has served.
Jan, thank you for the thoughtful insight, analysis on all issues, in-
cluding and especially those pertaining to regulations and its im-
pact on small businesses. Thank you very much.
Now, as we start the second session of the 117th Congress, it is
critically important that we begin with a discussion on oversight.
With roughly $1 trillion in assistance provided to the nation’s
smallest firms through the Small Business Administration, we
must exercise our oversight responsibilities wisely and often. It is
not just dollars flowing to small businesses. There are new pro-
grams at the SBA that also require our attention. That is why I
am thankful we have today’s conversation with Inspector General
Ware.
Congress moved quickly in the spring of 2020 to support the na-
tion’s economy with hundreds of billions of dollars for small busi-
nesses. Some of these programs, like the Paycheck Protection Pro-
gram, which was driven by private sector lenders, focused heavily
on the nation’s workers. Other programs that were administered
directly through the SBA moved slower and were overall less suc-
cessful. Fraud took place and taxpayer dollars were and continue
to be wasted. This is unacceptable.
The numbers presented by the inspector are significant. While
the IG reports approximately $4.6 billion in possible fraudulent ac-
tivity within the Paycheck Protection Program, the Economic In-
jury Disaster Loan Program, also known as EIDL, is enmeshed in
roughly $84 billion in potentially fraudulent activity. The PPP was
administered by private sector financial institutions. The EIDL
program was not. The SBA acted as the sole and only gatekeeper
to the EIDL program. That any theft or businesses and individuals
illegally entered the program is a major problem for the EIDL pro-
gram.
Differences on how these programs were run cannot be over-
stated and they should serve as case studies for future public policy
debates on how the SBA should run its programs. Asking SBA to
expand or enhance their direct lending ability would be counter to
the facts that we have on the ground.
Beyond the COVID relief programs, we know that the SBA has
struggled with identifying risks within their access to capital pro-
grams, overseeing their contracting programs, and updating and
keeping pace with their information technology needs for years.
The COVID emergency period has compounded all these pro-
grams and challenges for SBA. I always say that when you put
something under stress, that is when you find out where your real
problems are. And obviously with this COVID situation and the
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
4
SBA taking on a tremendously increased workload, we now know
where a lot of problems are.
Due to PPP and EIDL, more businesses know about the services
and functions of SBA than ever. Therefore, the SBA must be ready
to serve and assist small businesses, all the while protecting tax-
payer dollars and preserving the integrity of the existing programs.
Small business owners do not have time to waste. They are fac-
ing significant price increases and they are having trouble finding
workers. Unfortunately, it does not end there. Supply chain issues
continue to thwart their planning and uncertainty surrounding a
vaccine mandate is ever present. Now more than ever, the federal
government programs cannot be duplicative, wasteful, or counter-
productive.
I look forward to hearing more from Inspector Ware on where
fraud stands today with the COVID relief programs, an update on
all recommendations, and what programs his office will be exam-
ining next. With such a significant amount of potential fraud clog-
ging the process for small businesses, I know the discussion will
not end here. This will require ongoing efforts for years to come.
With that, Madam Chair, I look forward to working with you this
year, and I look forward to continuing to work with the Inspector
General. To that end, I want to give you this letter which is a list.
And we can give that to your staff. This letter which is a list of
some of the witnesses and topics that I think would be impactful
for and helpful to us in our legislative and oversight work.
With that, Madam Chair, I yield back and look forward to work-
ing with you this coming year.
Chairwoman VELÁZQUEZ. Thank you, Mr. Luetkemeyer. The
gentleman yields back.
With that, I will now introduce our distinguished witness, the
Honorable Hannibal ‘‘Mike’’ Ware, Inspector General of the SBA.
Mr. Ware was sworn in as the inspector general in May 2018 and
has been an effective leader in his role and an asset to this Com-
mittee. He has nearly 30 years of experience in the IG community
rooting out fraud, waste, and abuse in federal programs.
Welcome, Mr. Ware. You are recognized for 5 minutes.
STATEMENT OF HANNIBAL ‘‘MIKE’’ WARE, INSPECTOR GEN-
ERAL, OFFICE OF THE INSPECTOR GENERAL, UNITED
STATES SMALL BUSINESS ADMINISTRATION
Mr. WARE. Thank you, and good morning. Good morning, Chair-
woman Velázquez, Ranking Member Luetkemeyer, and distin-
guished Members of the Committee. Thank you as always for invit-
ing me to speak with you today and for your continued support of
my office.
It was my hope that my next appearance before this Committee
would occur with the pandemic in our rearview mirrors. However,
the pandemic has been lasting with everchanging challenges.
SBA has played a pivotal and unprecedented role in stabilizing
the U.S. economy. In doing so, the men and women of SBA who
have been on the frontlines and who have directly met the needs
of millions of small businesses, they have sacrificed their time and
worked long hours to implement these programs on an unprece-
dented scale. Not only do we as taxpayers thank them for their
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
5
hard work, but there are countless whistleblowers who have come
forward to my office to shine the light of transparency on matters
that they believe were of concern to stewarding the taxpayers’ dol-
lars. We thank them not only for their hard work but for their
courage and sense of duty to the nation.
The men and women of my office equally have been working dili-
gently to provide oversight of SBA’s pandemic response. We have
never lost sight of the struggles of the small business owners and
their employees who toil not only with financial hardship but in
many cases personal loss as a result of the pandemic. We are keen-
ly aware that nothing short of the public’s trust is at stake in our
oversight efforts.
We have already issued 18 reports addressing SBA’s pandemic
efforts with dozens of recommendations for corrective action. Our
investigative work to date has resulted in 366 indictments, 294 ar-
rests, and 142 convictions related to EIDL or PPP. The monetary
recoveries and savings from our oversight investigations pandemic
response efforts in fiscal year 2021 alone were $4.2 billion, with
Congress investing just $50 million in supplemental funds to facili-
tate our oversight efforts.
And the work has really just begun. A significant portion of our
supplemental funding will be exhausted by the end of fiscal year
2024 which will coincide with hundreds of billions of dollars in
EIDL loans coming due for payment. We anticipate this will be a
key moment for realizing the true scope of fraud in the program
which already is expensive.
We believe our annual resource levels will need to be right sized
to match this fraud landscape and to provide necessary oversight
of SBA’s management challenges in the years beyond the pandemic
response.
Notwithstanding the challenge, OIG has sought opportunity to
more effectively and efficiently carry out our mission. We have pro-
vided oversight in real time, producing reports in under 2 months.
In doing so, the IG community took note and used our oversight
model to develop an agile products toolkit for OIGs across govern-
ment. The result of our innovation is that we proudly kept the Con-
gress, the administrator, our stakeholders, and the public currently
and fully informed of SBA’s pandemic response efforts.
I am also happy to report that OIG has taken significant strides
in leveraging data analytics to oversee these vast loan portfolios.
We are moving from a reactive data analytics posture to leveraging
artificial intelligence and machine learning to get in front of fraud
and expand the reach of our oversight.
In OIG’s dealing with SBA’s leaders throughout the pandemic, I
have never had a reason to doubt their commitment to providing
assistance to the nation’s small businesses. In terms of character-
ization of SBA’s response to our findings related to their pandemic
response, it is my perspective that there were missed opportunities
to recalibrate internal controls and implement corrective action in
a timely manner at the outset of SBA’s pandemic response efforts.
This has since changed significantly as we work more closely to im-
plement proper internal controls from the onset of new program
startups. We are committed to providing independent and objective
oversight of SBA’s programs and operations. And in doing so, we
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00009 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
6
will continue to shine the light of transparency and work diligently
to keep everyone informed.
Thank you for the opportunity to speak to you today. I am happy
to answer any questions you may have of me.
Chairwoman VELÁZQUEZ. Thank you, Mr. Ware.
I now recognize myself for 5 minutes for questions.
Mr. Ware, Administrator Guzman indicated that this administra-
tion is sincere in implementing the IG’s recommendations and that
SBA has made great strides in satisfying most recommendations.
Is this administration cooperating with ongoing audits and inves-
tigations, and can you expand on your relationship with the admin-
istrator in resolving the IG’s recommendations?
Mr. WARE. Yes. Thank you for the question.
I could say unequivocally that this, well, the leadership team at
SBA currently is definitely taking recommendations seriously and
moving quite quickly to resolve them.
Chairwoman VELÁZQUEZ. Thank you.
In your July briefing with the Committee, you indicated that 50
recommendations made by the OIG related to PPP and COVID-
EIDL remained open. At this time, how many remain open?
Mr. WARE. At this time, I believe that number is, it could be 20.
I could get back to you on the exact number. What I do know is
that half of the number that remain open have not quite come due
yet to be closed. And the date for another set of them passed just
December 31st and we may have the information on it but we have
not reconciled that information yet to give an update as to which
ones can be closed.
Chairwoman VELÁZQUEZ. Thank you. Speed was imperative at
the beginning of the pandemic leading to fraud controls being re-
moved. The current administration put guardrails back in place to
prevent further fraud and abuse. Has your office evaluated wheth-
er any of the new safeguards are achieving their intended goals
since most of the audits and investigation have focused on the per-
formance of the PPP and COVID-EIDL programs under the pre-
vious administration?
Mr. WARE. So there are a few ways to look at that. To answer
the question directly, we are in the process of reviewing those. And
as a matter of fact, two reports should be out addressing those
questions more directly within the next 30 days I believe. I hope;
right? That is what we are looking at. But I could tell you this,
what was done differently in terms of this leadership team was an
upfront focus on the internal control environment that included an
actual sit-down to determine what was best to be put in place prior
to setting anything else up.
Chairwoman VELÁZQUEZ. Thank you. Mr. Ware, Congress cre-
ated the COVID-EIDL program to provide quick working capital to
small businesses suffering economic injury due to the COVID-19
pandemic. In creating this program, Congress acknowledged that
the private sector will struggle to deliver relief funds to small dol-
lar borrowers quickly. Given the COVID-EIDL emphasis on the
fast delivery of funds and the approach the private sector took to
focus on larger businesses and existing clients with PPP, do you be-
lieve it is fair and appropriate to compare COVID-EIDL to the 7(a
loan program?
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00010 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
7
Mr. WARE. Being that they are two totally completely different
animals, it is difficult, based on the evidence that we have, to make
a comparison of the two in terms of how delivery is. Certainly, the
body of work definitely says that the direct lending programs have
had issues in terms of a fraud environment, but so has the 7(a)
program as well. We have our own issues with them. To make up
a comparison of the two when speaking about direct lending, I do
not believe that we have a body of work that can make that be-
cause there are so many different aspects that have to be consid-
ered. And we have focused primarily based on fraud risk.
Chairwoman VELÁZQUEZ. Okay. So is it fair to compare new
direct lending programs to the COVID-EIDL given the stark dif-
ferences and goals in the two programs?
Mr. WARE. I believe that a whole lot of angles have to be consid-
ered if you are going to do a comparison. From an Inspector Gen-
eral perspective, from my perspective, either way there is the con-
trol environment that will tell the tale.
Chairwoman VELÁZQUEZ. Thank you.
Mr. WARE. A proper control environment could——
Chairwoman VELÁZQUEZ. My time has expired.
Mr. WARE.—a lot of issues that we have seen.
Chairwoman VELÁZQUEZ. Thank you.
Mr. WARE. Thank you.
Chairwoman VELÁZQUEZ. Now I recognize the Ranking Mem-
ber, Mr. Luetkemeyer, for 5 minutes.
Mr. LUETKEMEYER. Thank you, Madam Chair. And again,
welcome, Inspector. Good to see you again.
I would like to start today by discussing some of the numbers
that your reports identified when it comes to fraud. In total it looks
like there is approximately $80 billion in potentially fraudulent
EIDL activity and another $4.6 billion potentially fraudulent activ-
ity within the PPP. These two programs have different mechanics
as you have just described but I think contrary to the point of the
Chairman, that there is some similarities here in that they are di-
rect lending programs, money going out the door, but they were
done in a different fashion from the standpoint that the PPP had
the private sector, the banks, credit unions and some fintech folks
delivering those funds versus SBA and their folks delivering that.
And so I think the difference there, correct me if I am wrong here,
but this is my question. It would appear to me that the rules, regu-
lations, processes, procedures, controls were not followed by the
SBA folks when it comes to the EIDL program and some of the
other direct programs, 7(a) programs that they implement versus
the banks and credit unions who have ‘‘ know your customer’’ rules
in place, laws in place that minimized. When you look at $4.6 bil-
lion in PPP, that is roughly 5 percent fraud rate. Eighty billion is
over 30 percent fraud rate in the EIDL program. That is a signifi-
cant difference between the two and I think there is a significant
difference in the way that they were adjudicated by the SBA.
Would you agree with that?
Mr. WARE. I would agree that the 7(a) program in dealing with
the lenders meant that they had more of a relationship and they
were able to let us know from the onset where the issues were and
to work with us to call back a whole lot of the money.
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00011 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
8
In terms of EIDL oversight initially with the focus being solely
on speed, initially and guardrails being lowered, it is just, that was
the reason. That was the reason that we ended up with what we
have.
Mr. LUETKEMEYER. Okay. So it begs the question then, have
the guardrails been put back up?
Mr. WARE. Have they? That is what you are asking me?
Mr. LUETKEMEYER. Yeah. You said the problem with the
fraud was the guardrails were taken off. Have they been put back
up?
Mr. WARE. Yes. Many of the guardrails have, and many of our
recommendations to that regard have been put in place.
Mr. LUETKEMEYER. I am going to follow up with regards to
the PPP. We had this discussion before and we found that a lot of
the fraud that was in the PPP program was in the fintech folks.
They did not have the ‘‘ know your customer’’ law in place that the
banks and credit unions do, or the banks have in place, and did not
really take the precautions to make sure that those dollars were
actually going to a real person and that this was not duplicative
actin on the part of the borrower. And so you were telling me in
earlier conversations and your other reports that the fintechs were
really kind of the problem children here. Have you seen that con-
tinue to be the situation? Do you see something different now or
where are we at with this?
Mr. WARE. What I told you at the time was that our investiga-
tive work was finding that where we were seeing the most fraud
in terms of our arrests, convictions, indictments and everything
else, there was a great deal, a percentage of those that had to do
with fintechs. Not saying that if the proper control environment is
in place that would be the case but that is what the evidence dem-
onstrates.
Mr. LUETKEMEYER. Okay. I know that the Chairman asked a
number of times about the recommendations that you are making
and it seems that they are making some progress, which is great.
I know the last time we talked there was some concern that one
of the problems was you make recommendations and the SBA ad-
ministration would put them in place but their staffs would not
execute on those recommendations. Have you seen that improve? Is
that still going on? Is it getting worse? What are you seeing?
Mr. WARE. I am actually happy for that question because I
wanted to clarify something. What I needed to clarify in this regard
is that these things normally take time to happen in earnest. So
somebody conducting a loan review and what my folks brought me
up to speed on was this. It is not every person conducting a review
that did not follow what is currently in place; right? We are finding
that in some instances it happens; in other instances, it does not.
And I believe though we may find that in just about every program
or every industry that sometimes what is in place is not followed.
Mr. LUETKEMEYER. Inspector, you just opened up a whole new
can of works there. So do we have people that are doing a good job
and adhering to the recommendations and now we have other peo-
ple that are not? Have you identified those other people yet so we
can point to them and say these people have to either shape up or
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00012 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
9
ship out? I mean, if we have got some bad apples in the barrel, we
need to get rid of them.
Chairwoman VELÁZQUEZ. Mr. Ware, time has expired but I
will let you answer the question.
Mr. WARE. Thanks.
Mr. Luetkemeyer, I do not believe it is a bad apple situation;
right? I believe that it is in terms of expertise. It is in terms of
training and it is in terms of having people know exactly what peo-
ple need to do to the T. We have not found where someone is will-
fully doing a poor job in terms of loan review. So I would not want
to categorize it in that way. And we have work coming out on that
that will be coming to you very, very shortly.
Mr. LUETKEMEYER. Well, when 40 percent of the program is
being fraudulently active, we have got a problem, sir. Thank you.
Chairwoman VELÁZQUEZ. Time has expired.
Now we recognize the gentlelady from Illinois, Ms. Newman, for
5 minutes.
Ms. NEWMAN. Thank you, Madam Chair, and thank you Rank-
ing Member. This is a great discussion today.
Thank you, Mr. Ware, for being here, and thank you for exe-
cuting this very daunting task. It does not fall short on us that this
is a complicated action that involves actions that took place 2 and
3 years ago, so this forensic taskforce has really been helpful but
realizing that it is tough.
I want to make one comment and clarify something because I
just want to clarify with you, you are investigating potential fraud
and those numbers are relative to potential fraud, not proven
fraud; correct?
Mr. WARE. So investigations and audits, two different things
clearly.
Ms. NEWMAN. Yes.
Mr. WARE. So in terms of our audit findings, those were poten-
tial fraud. We have not reviewed or completed our review on the
entire package, large package to determine what is the actual
fraud. We do know anecdotally that what we have called potential
fraud is very likely fraud because our fraud cases and criminal con-
victions and indictments speak directly to the patterns that we doc-
ument as potential fraud.
Ms. NEWMAN. Thank you for clarifying.
So I have three areas of question. I hope we can get it in in the
five. Tell me a little bit about this right-sizing project. I really like
this idea. I have done this in business before so I really like the
agile product. Can you just share a little bit about what is in that
product kit?
Mr. WARE. Great. In the toolkit is a way for you to identify and
focus on a single question or to notify management and leadership
of serious crucial problems that they need to take action on imme-
diately.
So in the case of EIDL, for example, once we started to see the
trends, we got to the table with the leadership team here while the
team was working on putting together something for public con-
sumption and told them, listen, you need to put a stop to this right
now. You need to set up a system of control that can identify these
duplicate IP addresses and these bad emails and these things that
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00013 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
10
fall in like three, four buckets. It needs to be addressed right now.
And we try to get that so the information is immediate and then
the public sees the entire thing that they could respond to within
30 to 60 days.
Ms. NEWMAN. Thank you. That sounds like it is working in real
time which is what we want right now. We do not want to lose any
more time.
A couple of other areas. One is data integrity. In our visit, oh,
gosh, it was probably in first quarter, it was clear that there were
some data integrity issues. Can you share with the Committee here
what has been done in the last 3 quarters to address the data in-
tegrity issues?
Mr. WARE. Great. So what we have found in working with them,
initially, of course, the deluge of things that came in completely
broke the system; right? So since that time they brought in a third-
party contractor that has done a great job in terms of cleaning up
the data. And as you know they put out, what, I think monthly
they put out the stats. They put out these things. This data has
been fixed tremendously. There are some, I think there is one field.
I am trying to remember. It has to do with congressional data that
we are looking at right now. So we are in the process of deter-
mining just how clean it is.
Ms. NEWMAN. Good. And I will look forward to that report.
And then finally, which of all of the loan programs did you find
the least potential fraud and why do you think that fared the best?
Mr. WARE. Great. So, the least potential fraud, of course, was
found in the Paycheck Protection program. And I believe one of the
reasons was because they knew, most of the lenders knew their
customers. So they were able to ask the right questions off the bat
and to put a stop to it prior to funds being disbursed. We got like
within the first week or so like 5,000 contacts from banks where
we knew there was a problem. And they were being able to hold
and they have been a great partner with us in terms of having the
funds seized and returned to the government.
Ms. NEWMAN. Well, thank you for that. And thank you for your
great work on this. And I will say again, thank you for going back
forensically to 2 or 3 years prior to this in solving some of the
issues that arose at that time. So appreciate your work.
Mr. WARE. Thank you.
Chairwoman VELÁZQUEZ. The gentlelady’s time has expired.
Now we recognize Mr. Williams, the Vice Ranking Member of the
Committee from Texas.
Mr. WILLIAMS. Thank you, Madam Chairwoman, and Ranking
Member Luetkemeyer. I am just listening to this. Already as a
small business owner it is amazing to me how this Committee and
this agency is so political and the main street small business owner
is getting squeezed right in the middle. This is going to have to
change.
Now, Mr. Ware, your report found massive fraud in almost every
one of the SBA’s COVID relief programs. In the EIDL program we
talked about this morning alone there has been nearly $80 billion
in fraudulent activity. This leads to us to question the ability of the
SBA to carry out or set up new programs in the future if they are
unable to properly account for taxpayer dollars when main street
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00014 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
11
businesses need it most and have earned it. The SBA demonstrated
their inability to discharge emergency lending at every single turn,
yet, my democratic colleagues want to expand the SBA’s lending
authority and kind of reward bad behavior even when the private
sector has proven willing and better suited to take on these efforts.
The private sector always does it better.
Mr. Ware, why should we expand direct lending authority for the
SBA when evidence that you talked about today has clearly proven
they were unsuccessful in properly executing their duties in com-
batting fraud in COVID relief programs?
Mr. WARE. Mr. Williams, thank you very much for that ques-
tion. The question as to why should you do that is really a policy
and program question that the IG is prohibited by law from re-
sponding to. I could tell you what our body of work talks about in
terms of an internal control structure and that a proper internal
control structure, regardless of which way this Congress or the ad-
ministration determines to go from a policy perspective is what is
most critical in my eyes.
Mr. WILLIAMS. Okay. During the pandemic, various federal
agencies were tasked with getting money to the American people
as fast as possible. Now, unfortunately, the SBA seemed to be one
of the worst in distributing business saving funds for the last 2
years. The Shuttered Venues Operator Grant (SVOG) program,
which was created from my bipartisan Save Our Stages Act, took
over 6 months from being signed into law before a single dollar was
disbursed. Cinemas, theaters, concert halls, and other entertain-
ment venues across the country struggled to stay in business while
they were left in the dark by the SBA’s Administrator Guzman who
has still not been held to account for these catastrophic failures.
People lost jobs. Futures were torn apart.
So Mr. Ware, based on their fundamentally unprepared to per-
form their duties, is it your opinion that the SBA setbacks are in-
dicative of greater organizational challenges? Or was it basic in-
competence and lack of leadership that caused these embarrassing
rollouts of events and lifechanging events for small business own-
ers? That is a pretty simple question.
Mr. WARE. Well, I mean, again, I go back simply to the work
that we have done. And you know, we put out a management alert
on the control environment and tracking performance results in
that program, the Shuttered Venue Operators Grant Program;
right? And in terms of the risk framework that we asked them to
put in place, clearly the five performance goals, we know that they
put those items in place. Relative to the rollout of it and what hap-
pened and who was to blame and everything like that for the delay,
we have not looked into that. We have another report on SVOG
that should be out shortly.
Mr. WILLIAMS. Well, I look forward to seeing that but you
ought to look into it and see who is responsible for delaying this
to these businesses that cost so many jobs.
So the SBA is tasked with assisting small businesses across the
country. I am a small business owner. However, they fail to prop-
erly communicate with businesses, borrowers, and lenders and
Members of this Committee during important times of need. So
when the SBA system disruptions halted the SVOG program in the
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00015 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
12
spring of 2021, businesses were unable to reach anyone at the SBA
to get a status update on their applications. And I mean, you could
not get anybody. So meanwhile, Members of this Committee such
as myself, were being stonewalled and did not receive the answers
to our pressing letters until October when our concerns were really
pressing. As Members of this Committee, we are charged with over-
seeing the SBA and I find this lack of communication troubling.
So Mr. Ware, do you have any information or data on the SBA’s
lack of communication with borrowers, lenders, or Members of this
Committee? We are customers, too, and you have to take care of
your customer. So if not, would your office to commit to looking
into the efficiency and the effectiveness of SBA’s communication
with stakeholders?
Mr. WARE. Yes. Well, definitely. Anything that is a concern to
this Committee is taken seriously as a concern by my office. And
if there is a request that you would like to put forward for us to
look into that, we can.
Mr. WILLIAMS. Yeah. I just did.
Chairwoman VELÁZQUEZ. The gentleman’s time has expired.
Now we recognize the gentlelady from California, Ms. Chu, for 5
minutes.
Ms. CHU. Mr. Ware, I am so glad to hear that your office will
continue to audit the PPP program and take a focus on fraud in
the loan forgiveness process. As you know, in order to qualify for
total loan forgiveness, the employers had to expend at least 60 per-
cent of their PPP proceeds on payroll. Well, I have heard from
labor unions representing hospitality workers in Southern Cali-
fornia who have made very concerning allegations of several major
hotels in the area including JW Marriott and the Chateau
Marmont. Their Members experienced widespread layoffs at the
start of the pandemic, yet the employer still received millions in
PPP loans and have applied for forgiveness. It is unclear how they
could have met the payroll requirements for the loan after laying
off nearly all of their workers so they have submitted complaints
to OIG but they have not been contacted yet.
So can you talk about the office’s process for responding to com-
plaints regarding PPP forgiveness? And with tens of thousands of
complaints coming in, will your office need assistance to investigate
these claims in a timely manner? Also, let me ask this. I mean, in
the hospitality business, the allegations are made of larger employ-
ers who received loans worth millions of dollars, so are you plan-
ning to establish a dollar threshold over which loan forgiveness re-
cipients will receive more scrutiny?
Mr. WARE. Thank you. So, there is a lot to unpack there. Let
me start with our hotline process and what we are dealing with.
You are correct; there are tens of thousands constantly coming in.
Here is what we have done. Clearly, my office, we tried just about
everything up front in terms of dealing with all the hotline com-
plaints, including reassigning staff. Including we got help from 10
different IG offices in terms of processing. What we have done now
is we have moved to more of a data-driven model in concert with
the Pandemic Response Accountability Committee (PRAC). And the
PRAC and my office developed a system by which we could take
this in and categorize them and do some triaging so we could get
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00016 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
13
these things out to the field. We actually got a public award for in-
novation for putting that together and we are still working on it.
As a matter of fact, it is my hope that if I was to be in front of
you in 30 days that I would tell you that there is no backlog; that
everything has been addressed. That is how aggressively we are
moving on it.
But that lends itself to a different issue; right? The issue is that
I have a finite amount of staff, investigative staff, that we have
staffed up. We are at about 180. And my criminal investigators are
carrying huge workloads. That is why we are partnering across the
entire law enforcement landscape. So the process in terms of get-
ting back to someone on like the people that you spoke about, right,
for us is an acknowledgement that we received it but we do not
provide updates, case updates to complaints. So that is the process
of maybe why they would know that.
I hope I touched everything. What did I miss?
Ms. CHU. Oh, I also asked about thresholds and how are you en-
suring that the larger transgressors are being addressed?
Mr. WARE. So as you are aware, all our criminal investigations
are run through the Department of Justice, and AUSAs across the
nation. These offices set the thresholds for our community. So what
we are doing, listen, the focus right now, really, is on the big ones.
The ones that were the rings and everything like that. So you
might see some that pop up because we have been providing I
think monthly, I hope. Monthly, we have been providing you an up-
date with the convictions, the cases and everything like that. You
might see some that are a small dollar amount, smaller dollar
amount. You see others with large dollar amounts. The small ones
would spill into what we are looking at in terms of a ring. They
are natural outpourings of that.
Chairwoman VELÁZQUEZ. The gentlelady’s time has expired.
Now we recognize the Ranking Member from the Subcommittee
on Economic Growth, Tax, and Capital Access, Mr. Meuser, from
Pennsylvania, for 5 minutes.
Mr. MEUSER. I thank the Chairwoman very much. And I thank
our Ranking Member. And Mr. Ware, I appreciate you being here
as well. It is unfortunate as this is an oversight hearing that the
United States Treasury Department has oversight of PPP as you
well know, and Secretary Yellen has been requested along with by
law required to appear before this Committee twice on an annual
basis and yet has yet to appear.
Do you have conversations with Secretary Yellen? Can you in-
form her perhaps for us since she is ignoring our requests to ap-
pear before this Committee and answer some of these important
oversight questions, Mr. Ware?
Mr. WARE. No, I do not. My oversight is within the Small Busi-
ness Administration.
Mr. MEUSER. Okay.
Mr. WARE. I meet regularly, every other week with the adminis-
trator here.
Mr. MEUSER. Well, PPP obviously falls within your wheelhouse
as well. So perhaps her insight and answers would be helpful to
you as well as this Committee.
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00017 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
14
So let me continue along related to the EIDL Disaster Loan Pro-
gram. Perhaps appropriately named, unfortunately. The thing is
that, look, there was $80 billion in fraud out of $260 billion in
loans. I mean, that is a really outrageous figure here as well as to
taxpayers. PPP as you offered and stated honestly was far more ef-
fective and successful. Nine hundred billion in loans with $4.6 bil-
lion in potential fraud. So a far, far better ratio for legitimate
loans. And as you mentioned, Mr. Ware, it is due to the partner-
ship with the private sector. So it would be considered to expand
the SBA sole lending vehicles by Members, our colleagues on this
Committee, or even your office. Would that be something that you
would advocate for, expanding lending vehicles solely through the
SBA resources as opposed to advocating for such lending vehicles
to be expanded via the partnership of the community banks such
as how the PPP loan was handled? Which would you prefer?
Mr. WARE. In my role, I do not advocate one way or the next;
right? I rely solely on the work that is done by my office to inform
this Congress and the people who would set up policies and the
people who would set up programs on what you have before you.
There are a lot of moving parts in order to make a determination
into that. Our focus has been on the fraud environment in terms
of——
Mr. MEUSER. Well, you are in charge of it. We need your input
on what would be most effectively carried out by the SBA. So
please keep that in mind.
Let me just ask you this as well regarding EIDL loans. Is it
going to get better before it gets worse? Are you comfortable at this
point with the loans being made? Have we put, as Ranking Mem-
ber Luetkemeyer brought up, additional safeguards in place so this
fraud does not continue?
Mr. WARE. I believe, and I think I have said it on record, and
I will say it again here, I believe that SBA’s programs have more
integrity in them right now than they did at the onset. And I be-
lieve that, for example, the major fraud concern, right, initially
SBA was dependent on self-certification. There was not sufficient
vetting of that information, even when information was clearly il-
logical. And that led to many of the problems that we found. I
think it is the 4506T tax transcripts and the type of data that they
are processing from the Internal Revenue Service, I think it ad-
dresses much of it and I will tell you, we are in the process of mak-
ing a determination as to how that fraud landscape changed and
what that meant in terms of savings to the American taxpayer.
Mr. MEUSER. Thank you, Madam Chairwoman. I yield back.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now we recognize the gentleman from Pennsylvania, Mr. Evans,
for 5 minutes.
Mr. EVANS. Thank you, Madam Chair.
In the past, you have reported that many missions critical and
senior positions at SBA are staffed by federal employees nearing
retirement. How has the SBA been dealing with the alleviation of
the workforce challenges? And can you please share with the Com-
mittee the progress that has been made in this area?
Mr. WARE. Thank you for that question. This is one of them that
I hate to have to say I believe I am going to have to get back to
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00018 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
15
you on that because I do not believe I have current work that in-
forms it. But I do know that my people ask questions like this reg-
ularly. I know I have seen from the chief human capital officer
here, Elias Hernandez, that they have put together some plans to
address that. We have not reviewed those plans as yet.
Mr. EVANS. Let me ask this question. Many small businesses in
my district are interested in contracting with the government. Such
contracts can help the businesses grow and expand. In recent
years, the federal government has been successful in achieving the
statutory goal of awarding 23 percent of all contracts primarily to
businesses. Can you tell us exactly how is that process proceeding?
Mr. WARE. The process of determining whether or not the man-
date has been met in terms of the percentage?
Mr. EVANS. Exactly. Exactly.
Mr. WARE. Well, over the past, at least since I got in, long be-
fore I got here in 2016, we have been going back and forth with
the agency on how they actually calculate those percentages. And
including how they run the numbers. They have been, actually, the
one change that they have made is that they have been trans-
parent to everyone in what goes into the denominator or what goes
into the numerator and coming up with that percentage. So at least
they are doing that. But it is within, remember, they are respon-
sible for ensuring that all other government agencies are calcu-
lating the same way in terms of making their percentage. The im-
provement that they have made is that we all know how they do
it.
Mr. EVANS. Thank you.
Thank you, Madam Chair. I yield back the balance of my time.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now we recognize the gentleman from Florida, Mr. Donalds, for
5 minutes.
Mr. DONALDS. Thank you, Madam Chair. And Mr. Ware,
thanks so much for making yourself available to the Committee on
such an important topic and for all the work of you and your staff
that you have been doing here.
I was taking some in-depth time reviewing your written state-
ment and you identified several challenges for the SBA in the fi-
nancial year 2022.
Challenge 3. The SBA’s economic relief programs are susceptible
to significant fraud risks and vulnerabilities.
Challenge 2. Inaccurate procurement data and eligibility con-
cerns in small business contracting programs undermine the reli-
ability of contracting goal achievements.
Challenge 3. SBA faces significant challenges in IT investment,
system development, and security controls.
Challenge 4. SBA risk management and oversight practices need
improvement to ensure the integrity of loan programs.
Challenge 5. SBA’s management and monitoring of 8(a) business
development program needs improvement.
Challenge 6. Identification of improper payment in SBA loan pro-
grams remains a challenge.
Challenge 7. The SBA’s Disaster Assistance Program must bal-
ance competing priorities to deliver prompt assistance and prevent
fraud; and
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00019 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
16
Challenge 8. The SBA needs robust grants management over-
sight.
Mr. Ware, these challenges are significant for any lending insti-
tution, let alone the SBA. Based upon all of this, does the SBA
have frankly the necessary infrastructure and wherewithal and ca-
pacity to embark on direct business lending considering all the
challenges the agency still faces?
Mr. WARE. That is a good question. Our goal and the goal of all
IGs, because all of us have to put out the top management chal-
lenges facing whatever agency or department that we are respon-
sible for. In all of this, I believe that the men and women of the
Small Business Administration are up to the task. I do believe that
there needs to be the type of systemic changes that we have de-
tailed in this document put in place and then I believe that the
programs could run and we could have an assurance that there is
more integrity in these programs.
I think it is probably better that I stop there. I do believe that
the Small Business Administration has the capacity to be able to
run the programs that they are charged with running.
Mr. DONALDS. Mr. Ware, what I will tell you is that could they
run their existing programs? I believe it is a maybe. But in the
world of lending, and I spent, you know, many years as a loan un-
derwriter, in the world of lending, maybe is what costs you your
customers money. And with respect to the SBA, maybe is what is
going to cost taxpayers money. I mean, I think the core question
for the Committee, and frankly for the American people overall, is
that if the SBA has a track record with direct business lending that
they have already had with the EIDL program, who is going to ac-
tually carry the losses when the SBA gets it wrong because of so
many systemic challenges they have in their infrastructure? Like,
who bears the real burden of losses from the SBA if they do not
have basic, you know, underwriting capacity that has been outlined
in your report?
Mr. WARE. You are asking me who bears it?
Mr. DONALDS. Yeah. Who bears the responsibility? Who is
going to bear the responsibility for dollars lost?
Mr. WARE. Well, for dollars lost it is the taxpayer; right? But
that is in all the programs. That is in the direct lending program.
That is in the 7(a) program because the agency pays the guarantee.
Mr. DONALDS. Well, and honestly, it is a statement, frankly,
Mr. Ware, that I think we both know but I think it is important
for all the Members of the Committee, no matter what side of the
aisle that you are on, for us to understand that even though there
are some good intentions that the Members may want to have or
want to see SBA engage in for the benefit of various business in
our country, the reality is that the SBA is nowhere near capable
from an institutional standpoint, from an infrastructure stand-
point, from a capacity standpoint to address those needs, especially
considering the fact that what they already have on their books
with respect to the EIDL program and the PPP program and the
existing loans in the 7(a) program. There is a lot of work to be done
over at the SBA. They are nowhere close. And to, in my view, radi-
cally change the mandate into direct lending would actually cause
significantly more problems and exacerbate those programs. It will
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00020 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
17
not fix them and we will be right back here having more hands just
like this one.
I yield back. Thank you so much, Madam Chair.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now we recognize the gentlelady from Pennsylvania, Ms.
Houlahan, for 5 minutes.
Ms. HOULAHAN. Thank you, Madam Chair. And thank you so
much for being here today and for your diligent work, Mr. Ware,
to oversee SBA’s unprecedented response to COVID and the
COVID-19 pandemic.
And I wanted to take my time and opportunity to ask for your
insights on how we can possibly apply lessons that we have learned
from the pandemic and the pandemic response to future disaster
relief programs.
Many small businesses in my community have also been seri-
ously impacted by the damage that was recently caused by Hurri-
cane Ida. In fact, my community is under a federal State of Emer-
gency. While some have bounced back quickly, others have been
less fortunate such as the Veterans Construction and Utility Serv-
ices Company that is located in Modena. Faced with damages to
equipment on top of economic pressures from the pandemic, this
veteran-owned and service-disabled small business opted to close
its doors for good, informing my office that they simply did not
have the capital to apply for an SBA loan, nor the capacity to take
on another bill to pay, particularly without the possibility of for-
giveness.
Unfortunately, this situation is very common. According to
FEMA, between 40 and 60 percent of small businesses never re-
open their doors after a natural disaster like Ida. Something I
heard time and again from small businesses in my community fol-
lowing the hurricane is where is PPP for natural disasters? I agree.
Why do we not have loan forgiveness like we did under PPP for
small businesses impacted by these natural disasters that are in-
creasingly more and more common. It is our responsibility to take
the positive aspects of our SBA COVID assistance programs, mak-
ing improvements where necessary to address lessons learned and
ensure that our small businesses have the support they need to re-
cover from all disasters, whether they be related to public health
or climate change.
So with this context in mind, I am interested in learning more
from you about how we can appropriately balance the need that we
have talked about here to get more money into the hands of small
businesses quickly in an emergency while understanding certainly
that the prevention of fraud can require a much more deliberative
and careful review.
So my question, sir, to you is has the SBA and has your organi-
zation and operation examined what the tipping point is between
getting money to businesses in a timely manner while also suffi-
ciently rooting out cases of fraud and abuse? So my specific ques-
tion is, are you not just looking at cases and addressing whether
they are fraud or not, but are you also trying to catalogue what it
is that we could be doing to be better at preventing this fraud and
abuse to begin with so that we can take the good of the PPP pro-
gram and apply it to other uses?
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00021 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
18
Mr. WARE. Thank you for your question. Please know that that
is a major focus of my office. We have put out 18 different reports
on the pandemic programs. From before the very first loan was
issued on PPP, we issued a report addressing this very same thing,
what needs to be done to balance speed and controls. How you need
to communicate to folks so that everybody knows what they are
doing. It is a major part of what we are looking at. And I have
sought to do this across government in my role on the PRAC. We
are going to work on a document that tells the entire disaster story
and to make sure that the lessons that we learn this time around
are there forever so that we do not make the same type of mistakes
again. So, yes, it is a huge focus of my office and has been from
the beginning.
Ms. HOULAHAN. And of those 18 reports, and I am sure in
counting that you are working on right now, are there any aspects
of those reports that this Congress and its responsibility can be
helpful in terms of changing, modifying PPP so that we could end
up with a PPE disaster program?
Mr. WARE. Yes. As a matter of fact, we worked closely with Con-
gress on one of the earlier reports on PPP where legislation was
put in place to address some of our findings. So this body has actu-
ally been on top of it in terms of making immediate changes,
changes that move pretty rapidly.
Ms. HOULAHAN. So I only have 40 seconds left of time and I
would really rather not ask my second question because I do not
believe we would have time for an answer but with the very limited
time I have left, I am an entrepreneur, a small businessperson,
mid-size businessperson as well, and some of the most remarkable
things that ever happen, happen under duress, when a company is
under duress or when an organization is under duress. And so we
have experienced extreme duress in this country due to COVID and
the innovations that have resulted are things like the PPP program
which arguably, and granted, have definitely, we have seen some
abuse. But we really should make sure that we are taking advan-
tage of an innovation such as PPP, figuring out how to take advan-
tage of the neuropathways that we have created between compa-
nies and their banking institutions and our SBA, and make sure
that we are able to use those innovations for something like the
stressors that happen in natural disasters as well.
And with that I yield back. And thank you, Madam Chair.
Chairwoman VELÁZQUEZ. The gentlelady yields back.
Now we recognize the gentleman from Minnesota, Mr. Stauber,
for 5 minutes.
Mr. STAUBER. Thank you very much, Madam Chair, and Rank-
ing Member Luetkemeyer for putting this hearing on. Thank you,
Mr. Inspector General for being here to answer our important ques-
tions.
What number of recommendations that you have made to the
Biden administration’s SBA in relation to fraud have yet to be
closed out?
Mr. WARE. So the exact number of the recommendations I could
get back to you really quickly on. But I do know——
Mr. STAUBER. Mr. Ware, has the agency explained why they
have yet to be closed out to you?
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00022 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
19
Mr. WARE. Oh, no. So it is important for me to note this. The
agency has moved rather expeditiously to close out the majority of
the recommendations. There are not that many outstanding that
have to do directly with what our systemic recommendations were.
When you look at it, the numbers are coming back to me, like 110
recommendations but about, what, 60, 70 of them had to do with
the financial statement audit. So in terms of the systemic things
to move PPP and EIDL and to deal with the Shuttered Venues pro-
gram that we issued——
Mr. STAUBER. Mr. Ware——
Mr. WARE.—they have pretty much closed those out. There are
only a few that are remaining. Most of them the date has not come
for when they are supposed to be closed.
Mr. STAUBER. Mr. Inspector General——
Mr. WARE. There are a handful that came——
Mr. STAUBER.—because my time is limited, Mr. Inspector Gen-
eral, you mentioned that the SBA has either partially or totally dis-
agreed with some of your recommendations. What procedure is in
place that occurs if they do not support your recommendation? Do
they remain open or what?
Mr. WARE. No. So here is what we have. It is both the agency’s
and my office’s responsibility to get these closed out. So we have
a process in place where we go to what we call the audit follow-
up official to make a final determination. If the final determination
is that, well, we flat out do not agree with you, I raise that with
this Committee as an item to determine whether or not you
feel——
Mr. STAUBER. And I think, Mr. Ware, I think that some of
those suggestions are going to be coming back to this Committee
I am quite sure.
One of the things that you had mentioned in your previous testi-
mony today, and this is almost a quote, that you do not advocate
in one way or the other. Mr. Ware, we need you to advocate one
way or the other because when you look at $4.6 billion of fraud in
the PPP and $84 billion in the EIDL loan, you see some defi-
ciencies. The SBA needs some changing and so we need you to ad-
vocate for those changes. Eighty-four billion, and my guess is as
you go, as you look into this further, you are going to see more
fraud. And my colleague, Byron Donalds from Florida asked you
who pays for this? It is the American taxpayer that pays for this.
I understand in this town, millions and billions, and now even tril-
lions is thrown around like it is nothing. Eighty-four billion dollars,
Mr. Ware, is exactly what we need you to find and hold these peo-
ple accountable, so we need your advocacy. That is the priority that
your mission statement says as Inspector General, to advocate for
the taxpayers.
And lastly, lastly because my time is limited, I just want to say
in closing, I just want to express my deep concern about this fraud
at the SBA. It should be troubling to everyone here that as families
are struggling with inflation, higher energy bills and the supply
chain crisis, that their hard-earned tax dollars are not being
stripped away to pay criminals for fraud.
I completely, Mr. Ware, and I want you to understand this, I
completely respect the work that you are doing to recover these
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00023 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
20
taxpayer dollars but it is beyond me that my colleagues on the
other side of the aisle still are trying to ram through their Build
Back Broke program to increase the funds at the SBA when we
know that they are not efficient right now. When the safeguards
that you have recommended are not even put in place by the SBA.
So we need your advocacy in this. We need you to step up and help
us. This Committee has full oversight of the SBA and we cannot
allow career bureaucrats in the SBA to determine this because
when we have done that, like the EIDL, $84 billion. That is with
a B. Billion dollars of taxpayer money. I cannot explain that to my
constituents in Northern Minnesota but I will tell them we are
going to find that money and we are going to prosecute the fraud.
We need your help, Mr. Ware. I am asking you to be an advocate
for every taxpayer.
Chairwoman VELÁZQUEZ. Time has expired.
Mr. STAUBER. And I yield back.
Chairwoman VELÁZQUEZ. The gentlelady from Georgia, Ms.
Bourdeaux, is recognized for 5 minutes.
Ms. BOURDEAUX. Thank you, Chairwoman Velázquez and
Ranking Member Luetkemeyer for holding today’s hearing. And
thank you, Inspector General Ware, for joining us today and for
your important work.
Since taking office, I have been working to ensure small
businessowners in my district have access to the tools they need to
apply for and receive loan forgiveness under the PPP program. Can
you give us an update on the OIG’s work to evaluate the PPP loan
forgiveness activity? So how involved have you been in this proc-
ess? And of particular interest to me was that early on we noticed
that there was disparity among different communities in my very
diverse district and who was receiving that loan forgiveness and
who was not. And so I would ask that you talk to that particular
issue as well if you have looked at that.
Mr. WARE. Thank you for the question.
We have two ongoing reviews right now on the loan forgiveness
process. What I do know as of this month probably a week ago or
so, 94 percent of the loans have been fully or partially forgiven.
The 2020 PPP loans that is. And less than 95 percent of the
amount that the loan value for 2020 PPP has been forgiven all or
in part. I do know that. So that is what I have so far. The work
is in progress.
Ms. BOURDEAUX. Okay. Thank you. That should cover every-
body pretty much.
So on that, so then moving on with this, so the other half of it,
of course, is making sure that we are preventing fraud in the loan
forgiveness piece. And can you speak to the work you are doing to
prevent PPP forgiveness fraud, of course, without holding up for-
giveness process for rule following businessowners?
Mr. WARE. Great. So I think what I do know, last year, about
the middle of last year, that is when SBA changed the way that
it was going to do the loan review process for forgiveness status;
right? So they decided that they were going to prioritize more man-
ual reviews that were based on fraud risk rather than the status
of forgiveness. They have gone to more of a, they say, a machine
learning type environment where they are able to determine risk.
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00024 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
21
Know this, getting forgiven does not mean that we cannot review
the loan afterward, that we cannot come after a fraudulent actor
after. So we are still in the fight for that.
Ms. BOURDEAUX. Okay. Thank you.
And you are going to be evaluating, it sounds like, sort of a data
driven risk program to see if that is really effective?
Mr. WARE. Yes.
Ms. BOURDEAUX. Okay. Thank you.
And then last of all, I know your office has been working on iden-
tifying preventing fraud, you know, across different programs. And
can you provide some insight into why the agency is further along
in addressing the PPP fraud issues as compared to the COVID
EIDL issues?
Mr. WARE. Is the question why were they further along?
Ms. BOURDEAUX. Yes.
Mr. WARE. Maybe an answer could be found. And so COVID
EIDL was realigned internally in order to address it. They were re-
aligned under the division within SBA that deals with the PPP
lending. So it is a familiar, more of a familiarity from the banks,
the lending institution private standpoint in terms of the systems
that they have in place to address and to catch fraud and to catch
things up front that allowed it to be better suited to deal with this
attack by fraudsters that came the agency’s way. And the lowering
of guardrails in the EIDL program in order to focus specifically on
speed at the time.
Ms. BOURDEAUX. Thank you. I yield back.
Chairwoman VELÁZQUEZ. The gentlelady yields back and now
we recognize the gentlelady from California, Mrs. Young Kim,
Ranking Member of the Subcommittee on Innovation, Entrepre-
neurship, and Workforce Development for 5 minutes.
Mrs. YOUNG KIM. Thank you, Chairwoman Velázquez. And I
would also like to thank our Ranking Member Luetkemeyer for
holding this very important hearing.
Thank you, Mr. Ware, for being with us and taking time to tes-
tify about your findings and help shed light on some of the waste,
fraud, and abuse issues taking place at the SBA. We all recognize
that your work is indispensable in our efforts to safeguard taxpayer
dollars and push the federal government to work more efficiently
and effectively for all constituents and small businesses.
A lot has been discussed regarding how SBA direct loans have
been more susceptible to fraud than loans provided by private fi-
nancial institutions. And I want to echo many of the same concerns
raised by my colleagues on the fraud plaguing SBA’s direct loan
program. And I have to say that I am very troubled that we are
considering expanding SBA’s direct loan programs without ensur-
ing internal controls against fraud and, you know, that is working
properly before we do anything.
So Mr. Ware, since the beginning of the pandemic, the SBA Eco-
nomic Injury Disaster Loan program has been riddled with fraud
and we all know this and we have been talking about this. With
fraudulent loans potentially topping $78.1 billion, this program
calls into question the efficiency of the SBA in any direct lending.
So has SBA leadership done all that it should to combat fraud in
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00025 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
22
the direct lending programs that the administration has adminis-
tered over the past year?
Mr. WARE. I would say yes. They have done a great deal. And
there is so much that pops into my head. Remember, at the onset,
in the EIDL program, that is when we put out the management
alert that was able to capture what type of fraud we were dealing
with within the program. And yes, SBA did not move. Leadership
did not move at the time as quickly as we would have liked it to
stem the tide of that fraud. But since that time, they have imple-
mented quite a bit of our recommendations. Some they even did in
real-time, like at the table making a telephone call. One that comes
to mind was stop people from changing the bank account informa-
tion after the verification has already been conducted. That was
one way that we stopped it almost immediately, that level of fraud.
Addressing the duplicate IP addresses and everything like that. So
a lot of controls have been put in place. That is the answer to the
question.
Mrs. YOUNG KIM. Another concern, and my colleagues’ concern
about direct lending, given that the SBA has a checkered past in
direct lending, would it not seem to call into question whether the
SBA has the capacity to undertake more direct lending authority
such as originating loans directly through the 7(a) program without
opening the door for more fraud?
Mr. WARE. What I would say is this, again, the work that I pro-
vided on the onset, right, was a completely different control envi-
ronment. The reason that I said, and sorry to offend, that I do not
advocate one way or the next, I think that to have any kind of ad-
vocacy that comes from an inspector general is in terms of the evi-
dence that I put before you that shows you what is going on in the
programs.
Mrs. YOUNG KIM. Well, thank you for your response.
I want to move on to another one of your findings regarding the
SBA’s failure to adopt effective IT systems. Your top management
report said SBA was expected to complete work on revising the
project scope and improving management areas by the end of 2021.
Can you provide us with an update and tell us if SBA was success-
ful in meeting that baseline reviews and completing the
functionality of that as certified by the end of 2021 like the report
said?
Mr. WARE. I can tell you right now that from the information
that I have before me currently, the system is basically where it
was when we last spoke but we are looking into it. Like you said,
it was at the end. We are just at the beginning of 2022 so we are
looking at it. My understanding is it still is not working as prom-
ised. That Beta Certify—was supposed to be what delivered the
woman-owned small business capability and that the application is
still in the program sustainment and production mode in other
words. So they hope to make a directional decision in the next 2
months. That is what I was told.
Mrs. YOUNG KIM. Well, thank you for your response.
It looks like my time is up so I will yield back.
Chairwoman VELÁZQUEZ. The gentlelady yields back.
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00026 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
23
Now we recognize the gentleman from Minnesota, Mr. Phillips,
Chairman of the Subcommittee on Oversight, Investigations, and
Regulations for 5 minutes.
Mr. PHILLIPS. Thank you, Madam Chair. Greetings, Mr. Ware.
Moments ago, one of my colleagues insinuated that Democrats
seem to not care about the fraud and are reckless with investment
in the SBA. I just want to remind everybody that I think we all
agree we are all here to provide oversight and ensure that there
is no fraud, at least as much as we can. Every dollar that is lost
to fraud and fraudsters is a dollar denied to the very small busi-
nesses that we are here to serve and a source of understandable
disgust by me and every American taxpayer. I just want to make
that clear.
And there is a lot of work to be done. We all know that. But I
applaud OIG’s dedication to providing oversight and to the SBA for
its diligence in implementing a number of important IG rec-
ommendations in recent months.
As Chair of the Small Business Committee on Oversight and In-
vestigation, along with Ranking Member Van Duyne let me assure
you we are both committed to ensuring that OIG has the necessary
resources to conduct proper oversight. Period. And with just $50
million in support from Congress, the OIG recovered $4.2 billion in
fiscal year 2021, which is an extraordinary return on investment.
So Mr. Ware, with that in mind, what more can Congress do to
support OIG and your efforts to ensure even more efficient and ef-
fective oversight and recovery efforts?
Mr. WARE. Thank you. Thank you for that.
Let me first say thank you to this Committee for all the work
that you have done with our office to make sure that we get you
what you need. But I think a reframing of the question might be
do we have enough resources for the oversight that will provide for
the pandemic loans that are going to perform many years after the
pandemic? So at present, like we demonstrated, we could provide
more oversight with more resources. That is not a good argument
though. The current level of oversight that we have includes just
over 180 positions. The problem is that our nonsupplemental budg-
et authority only provides for 125 and as I said in my opening, the
supplemental funds are going to be gone by the end of fiscal year
2024. So I think that it is bad timing in terms of that is going to
be a key moment for realizing the true scope of fraud in these pro-
grams. But, so I believe that the annual resource level, the ones
that we get annual appropriation. You know, I am Executive
Branch. I work with the Office of Management and Budget and
they work well with me. What I could ask the Committee is to just
please support what comes forward in terms of right sizing us to
match the fraud landscape.
Mr. PHILLIPS. Okay. Thank you, sir. And I encourage my col-
leagues to give that deep consideration when that request is made.
As we all know, PPP was designed to expeditiously distribute
funds with much of the fraud and eligibility controls designed to
occur not at loan initiation; rather, during the loan forgiveness pe-
riod. I know OIG has identified I think it is 70,000 loans roughly
totaling $4.6 billion in potentially fraudulent PPP loans and stated
‘‘ this might the tip of the iceberg.’’ So with a large majority of the
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00027 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
24
PPP loans now being partially or fully forgiven, does OIG have a
better sense of the extent of total PPP fraud? I do not remember
if you gave a specific sense of that. And if not, when will you have
a more distinct picture of fraud?
Mr. WARE. That work is ongoing. So the work on loan forgive-
ness, we have I think there are two that are ongoing currently in
which we should have at least some indication of what we are look-
ing at. I still think we are going to see where the rubber meets the
road on a lot of these that will not come back for loan forgiveness
because the numbers are large; right? Even if it is 5 percent, the
numbers are still huge. So, and on those that may default early,
because we have an early default high-risk lending review program
internally.
Mr. PHILLIPS. Okay. With my minute left or so, we know there
are a number of nonbank lenders that may have been particularly
susceptible to processing fraudulent or ineligible loan applications.
Is OIG working specifically to identify and investigate those lend-
ing institutions, the nonbank lenders?
Mr. WARE. Well, we have not focused on any over any. The
number that we are dealing with, we have enough from the entire
landscape to select from. I mean, our agents have caseloads that
are just unimaginable, quite frankly.
Mr. PHILLIPS. I imagine.
Mr. WARE. So.
Mr. PHILLIPS. Okay. Well, with that in mind, you know, my
first question was what resources do you need? I trust you will not
be shy in asking us because it is our responsibility to ensure you
have the resources to provide the oversight that we expect and de-
mand, and so do American taxpayers. So thank you, again, for your
service, sir.
And with that, Madam Chair, I yield back.
Mr. WARE. Thank you.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now we recognize the gentleman from Wisconsin, Mr. Fitzgerald,
for 5 minutes.
Mr. FITZGERALD. Thank you, Madam Chair.
General Ware, thanks for being here again. You can hear the
level of frustration I think in some of the Members’ voices as they
continue to ask the questions. And it is difficult I think in a 5
minute exchange to kind of get down to the nitty-gritty.
Let me just ask you a couple of things here. In the Fall of 2021
Semi-Annual Report to Congress you mention that the OIG had
been working diligently with federal, state, and local law enforce-
ment partners over the past year to bring more than 300 PPP or
EIDL fraudsters to justice. The result has been reiterated numer-
ous times today. It is $460 million in assets recovered not including
the $3.1 billion that the OIG helped financial institutions recover.
So I guess my question is, what is the measuring stick that you are
using at this point to kind of gauge what you would consider suc-
cess? You know, those numbers the way the math kind of shakes
out is it is just a 3 percent recovery but, you know, what I am won-
dering is what is that goal that you guys have internally right now
and certainly I would love to hear updates on a regular basis given
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00028 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
25
to the Committee so that we know kind of where we are at and
what is going on.
Mr. WARE. Regarding the updates, there is an update document
sent to this Committee that comes out I believe on a monthly basis.
Either monthly or quarterly. Yeah, it is monthly. On a monthly
basis that goes to this Committee. Relative to measuring the num-
bers that you are using, do you remember that the Semi-Annual
Report covers 6 months; right? So understand that as well.
In terms of a measuring stick for success, success is the whole
of government approach that we have taken from the onset. We are
working with the Department of Justice and with AUSAs across
this country in order to pull this together. We are working with the
FBI, the Secret Service. Our success is all of our successes. It is
really the success of the American taxpayer in terms of how much
fraudulent actors we will catch. I do not have a number like we
need to catch X amount of people. What I do know is that we are
diligently working on bringing fraudulent acts, fraudsters to justice
in these programs.
Mr. FITZGERALD. Well, I think my concern is that as we go
through this process now, and unfortunately, I mean, PPP and the
EIDL program, you know, even though they have been great suc-
cesses, they are tarnished now. And they are tarnished by this high
fraudulent number. If there is some way for us to moving forward
say this is where you might shutter a program, you may actually
make a determination that it is no longer serving its purpose be-
cause of the high fraudulent number. I mean, I do not think that
is out of the realm and that appears to be something that has hap-
pened in the past related to some other SBA programs. So I mean,
from my perspective, I think that is something that we should be
aware of, we should be watching and, you know, a year from now,
let us all get back together and see exactly where we are at be-
cause, unfortunately, I think it might mean the end of some pro-
grams if it is not characterized this way or if there are not specific
hard deadlines on trying to meet some of those goals. And I think
it would be in the best interest of obviously the SBA but, you know,
your office kind of has the reigns there and you can make that hap-
pen. So I am hoping that, you know, with these regular, and if you
say it is monthly updates I certainly will pay more attention to
that and I hope the communication is free flowing between the
Committee and your office.
Mr. WARE. Can I say one thing?
Mr. FITZGERALD. Yeah, go ahead.
Mr. WARE. Okay. One of the things I forgot to mention that I
think is very important for everyone here to understand is that
white collar crime of this type normally takes years to manifest
and to really come forward. What we have done is we have expe-
dited this in a way that really has not happened in the past and
so what we are seeing is we are only still at the beginning of it
because the loan forgiveness process is not even done yet. The
EIDL loans have not even come up for repayment yet. So that
would be where the real rubber meets the road in terms of fraud
cases and everything else. So that is understanding that we are
still at the very onset of our oversight.
Chairwoman VELÁZQUEZ. The gentleman’s time has expired.
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00029 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
26
The gentlelady from Kansas, Ms. Davids, Chairwoman of the
Subcommittee on Economic Growth, Tax, and Capital Access is rec-
ognized for 5 minutes.
Ms. DAVIDS. Thank you, Chairwoman. And thank you, Mr.
Ware, Inspector General Ware for joining us today to report on the
SBA’s managerial and programmatic challenges.
As you mentioned in your testimony, the Paycheck Protection
Program and the COVID EIDL program have unfortunately been
susceptible to forms of fraud and abuse, and these programs have
been especially vulnerable because of the broad scope and as you
mentioned, the rapid implementation during the very beginning of
the pandemic.
I am particularly concerned about the fraud in the COVID EIDL
program involving identity theft because it not only harms the tax-
payers and real small businessowners, but also innocent individ-
uals who are not at all connected in that way. So, you know, in
your OIG report 21-15 which was released in May, you examined
the SBA’s handling of identity theft in the EIDL program and
raised concerns about the OIG’s lack of administrative seizure au-
thority. So I am curious if the lack of seizure authority has im-
pacted the case, you know, what you are seeing now and how that
has impacted cases your office is able to pursue.
Mr. WARE. Great. So I would say that in terms of impact, it has
not stopped anything because we work very closely with the Secret
Service. We have a great relationship with them to seize on our be-
half because they have, obviously, the seizure authority. Now, if we
had it in this instance I believe we would be able to move a little
bit faster but that is it.
Ms. DAVIDS. Okay. Well, I appreciate that. And that was defi-
nitely something that stuck out to me.
And then I think I kind of want to switch over to ongoing liabil-
ity. So you had mentioned many of the initial vulnerabilities of the
program had been fixed and I am curious if you could speak to the
ongoing liabilities in the Paycheck Protection Program and EIDL
programs and what further steps the SBA or even this Committee
need to take as we move forward. You know, if you want to speak
to that for a minute.
Mr. WARE. Can you help me to understand? What do you mean
specifically by ongoing liability?
Ms. DAVIDS. I guess what I am thinking about is, you know,
there were some, you know, guidance to financial institution issues
that had occurred earlier on and I am curious if, you know, wheth-
er or not there is ongoing, I say ongoing liabilities. I think what
I am thinking about is the potential for, you know, additional fraud
and those kinds of things. As you said, when the rubber meets the
road, you know, those dates have not come up yet so I am curious
if you could talk to us a little bit about what is going on or if there
are any steps that we need to be taking.
Mr. WARE. So the whole landscape would be different because
of closed programs; right? So the money at this point is already
out. So we are dealing with looking at it from a loan forgiveness
perspective of which we have two ongoing reviews that will inform
us greatly on what that continued risk is from that standpoint. The
same will happen when the loans come up for repayment in COVID
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00030 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
27
EIDL. So in terms of informing, that is the work that is ongoing
currently. But it is kind of two different things, if you know what
I mean. In terms of the money going out the door is where we were
at before. The money is out the door already.
Ms. DAVIDS. Yeah. Okay. Well, I appreciate your being here. I
appreciate the work you guys are doing over there and I will look
forward to if there are any further issues that we are seeing, we
will absolutely keep the line of communication open with your of-
fice.
Mr. WARE. Thank you.
Ms. DAVIDS. Thank you, Madam Chair. I yield back.
Chairwoman VELÁZQUEZ. The gentlelady yields back.
Now we recognize the gentlelady from Texas, Ms. Van Duyne,
Ranking Member of the Subcommittee on Oversight, Investiga-
tions, and Regulations, for 5 minutes.
Ms. VAN DUYNE. Thank you very much, Chairwoman
Velázquez and Ranking Member Luetkemeyer for holding this
hearing today.
And thank you, Inspector General Ware for being here and for
your continued oversight work. What your office does, especially
over the last 2 years has been vital. This has been clear by the $4.2
billion in recovered funds and savings from your oversight of SBA’s
pandemic response efforts last year.
As we are all aware, the December CPI numbers just came out
today and they are even worse than expected once again. Gasoline
is up 49.6 percent. Used cars and trucks are up 37.3 percent. Rent-
al cars and trucks are up 36 percent. Propane, kerosene, and fire-
wood are up 33.8 percent. This is on the backs of working Ameri-
cans and on small business employers. Many deserving applicants
are being pushed out and being beat out by fraudulent applicants.
So if about $80 to $100 billion worth of fraudulent improper pay-
ments have been given by the SBA, theoretically, if the SBA was
to return that fraudulently obtained money, could they then pro-
vide that money to other more deserving applicants?
Mr. WARE. I will need to get back to you on that one. That is
a complicated question quite frankly and I believe that it has to go
through Treasury. There are some rules that need to be followed.
I do not believe it is as easy as going back into the program and
going back out. But I would need to clarify that. I would not want
to give a wrong answer on the record.
Ms. VAN DUYNE. I would be interested in hearing the response
on that. Because if $100 billion was appropriated to be able to give
out in this fund to those deserving applicants and $100 billion was
fraudulently given out, it seems to me that you would be able to
take that money that was fraudulently given out and be able to
help those people who need it the most. That was the purpose.
That was the appropriation of those dollars by Congress. So if you
could get back with my office on that I would really appreciate it.
Mr. WARE. The only issue is that that money is still potential
that we do not have our hands on the money to pull back yet.
Ms. VAN DUYNE. I think that was part of my question is if you
were able to obtain those fraudulent funds.
Mr. WARE. Okay. Okay.
Ms. VAN DUYNE. That was the assumption. Yeah.
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00031 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
28
It is clear the amount of fraud is incredibly large and the Secret
Service’s National Pandemic Fraud Recovery Coordinator was
quoted saying he has never seen something at this scale. So consid-
ering those kind of issues, what would you recommend this Com-
mittee, or who would you recommend that this Committee reach
out to to expedite getting these funds back and prevent further
fraud from occurring?
Mr. WARE. To give which funds back?
Ms. VAN DUYNE. The funds that have been handed out fraudu-
lently.
Mr. WARE. Oh, that have been recovered?
Ms. VAN DUYNE. That we have not yet recovered. How can we
get those funds back and quickly? How can we expedite the recov-
ery of those funds? Who would you recommend that this Committee
call and work with?
Mr. WARE. Well, I would believe that that would be with the De-
partment of Justice, but I do believe that the Department of Jus-
tice is working hand-in-hand with the law enforcement community,
federal, state, and local in that regard.
Ms. VAN DUYNE. All right. So the financial institutions that
have been involved with this process from the beginning and they
have not been able to help return funds. So would it be beneficial
for Members of this Committee to work collaboratively with these
financial institutions, either by holding hearings or by other
means?
Mr. WARE. So remember that you are talking about two dif-
ferent programs; right? One, a direct lending program that was
done by SBA and the other that was done by banks. And like so
many have pointed out, where we found rampant fraud was in the
direct lending program.
Ms. VAN DUYNE. I am just wondering if you think it would be
beneficial for this Committee to be able to work with financial in-
stitutions to identify how we could better the program and prevent
fraud from happening in the future.
Mr. WARE. That is a tough one for me. Perhaps.
Ms. VAN DUYNE. Okay. Okay. In your November 30th report
you highlighted that your review of a Treasury Department anal-
ysis revealed that SBA’s lack of adequate framework controls dur-
ing this period of review led to 75,180 COVID-19 EIDLs totaling
over $3.1 billion and 117,135 emergency EIDL grants totaling over
$550 million being disbursed to potentially ineligible recipients.
Has this lack of control been resolved?
Mr. WARE. Yes. Yes, it has. SBA immediately instituted the Do
Not Pay check that is now automatic in their process.
Ms. VAN DUYNE. Excellent.
Mr. Ware, I appreciate your hand work that you and your office
continue to do. It will certainly give the Members of this Com-
mittee a lot to think about in terms of oversight. I hope the Chair-
man of the Oversight, Investigations, and Regulations Sub-
committee, Mr. Phillips, agrees that we should be holding a hear-
ing on the rampant fraud that we see in these programs and that
would be an excellent first step. Thank you very much.
I yield back.
Chairwoman VELÁZQUEZ. Time has expired.
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00032 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
29
Now we recognize the gentleman from Louisiana, Mr. Carter, for
5 minutes.
Mr. Carter, you need to unmute yourself.
Mr. CARTER. Thank you. Madam Chair, thank you very much.
Mr. Ware, thank you very much for your service.
Staffing up for major disasters continue to be a top management
performance challenge for SBA. The challenge has been even more
evident with the current pandemic, and for me in Louisiana, insult
to injury is the pandemic as well as the natural disasters that we
suffered with with Hurricane Ida. When the agency was forced to
hire more permanent and temporary staff than ever before and
process millions of COVID EIDLs, Mr. Ware, your office rec-
ommended the agency develop an after action plan to assess how
the agency staff performed during the pandemic so they could do
better with the next disaster. To your knowledge has the agency
committed to conducting these assessments?
Mr. WARE. They have committed to conducting the assessments.
We have not yet seen it.
Mr. CARTER. So when do you anticipate, do you anticipate them
actually doing it, and what effort do you have to kind of make sure
that this actually gets done?
Mr. WARE. I do anticipate. I believe that there was a date asso-
ciated, a deadline for when they were supposed to do that. That
deadline has not come up yet I believe. I do not have the exact
dates in front of me. I certainly could get that to you but the only
way that that recommendation would be resolved is with that docu-
ment.
Mr. CARTER. Will you provide any guidance for them on the
best way to conduct this assessment or do you plan to play any role
in providing guidance?
Mr. WARE. That is the trick part of the job of an inspector gen-
eral. I cannot build it for them and then review it by law. So what
I could do is provide the evidence based on the work that I have
done up to that point that they could get from and deal with the
recommendation from there.
Mr. CARTER. Are there best practices that are out there that
does not put you in a potential conflict but that can provide some
guidance on best practices on how this could be done?
Mr. WARE. The best practices are what we can offer up. I do not
recall, because I do not have that particular report in front of me
where the recommendation came from but this is definitely some-
thing I could get back to you on more definitively.
Mr. CARTER. Okay.
Mr. WARE. I do not want to speak above it and then have the
auditors come after me.
Mr. CARTER. That is fair. Are there lessons you could take from
FEMA or other agencies on how to rapidly staff up better?
Mr. WARE. I certainly could but I also believe they have, be-
cause remember that the EIDL program is not new; right? The
EIDL program has been around forever. So they have consistently
had this challenge. They know how to ramp up. The question is the
ramping up, are the folks trained? Are the folks properly vetted?
And that is something that we continue to work with them to see
that it is done.
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00033 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
30
Mr. CARTER. As a part of your oversight, do you look for and
determine if small minority businesses, woman-owned, disadvan-
taged enterprises are having an opportunity to be a part of that
ramp up? Oftentimes we have these ramp ups and we have compa-
nies or agencies that are big and by its nature have the ability to
be ready for these kinds of opportunities but because Small Busi-
ness Administration obviously, we have an interest in making sure
that we are providing opportunities for small businesses, truly
small businesses to play a role. Any guidance or thoughts as you
go through your oversight to determine if, in fact, we are reaching
those small businesses so they have an opportunity to partake in
the aftermath in the case of a pandemic or other natural disasters?
Mr. WARE. That is a good question. I do not believe my office
has performed or conducted any work in the area that is in align-
ment with your question. But it is certainly something that we
could look at. I will talk with my team responsible for the disaster
programs and get their thoughts on it.
Mr. CARTER. That would be very helpful, particularly as I men-
tioned in my jurisdiction we have a plethora of small businesses
that are, in fact, oftentimes on the side watching larger firms get
the work, many of which are not in the jurisdiction that the nat-
ural disaster took place in and obviously that is very difficult when
we are trying to build a small business base and create opportuni-
ties for small and emergent businesses. So any assistance that you
can give us in that area and provide some guidance and/or resource
would be greatly appreciated.
Madam Chair, I yield back.
Mr. WARE. Thank you.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now we recognize the gentleman from New York, Mr. Garbarino,
for 5 minutes.
Mr. GARBARINO. Thank you, Madam Chair and the Ranking
Member, for having this hearing. Thank you, Mr. Ware, for being
here.
I have a question. And I know my colleagues brought it up before
and you mentioned the top challenges, there are a couple that SBA
is facing in fiscal year 2022 and the first one on the list was SBA’s
economic relief programs are susceptible to significant fraud risks
and vulnerabilities. You have seen the books. You have seen the
inner workings of the SBA. And I know a couple people have asked
you already if you would advocate that they increase these pro-
grams. I am not asking you to say yes or if they should not, but
is the SBA prepared to start new direct lending programs or in-
crease the amount of money that they are lending before this chal-
lenge is addressed? I am not asking you if they should or not; are
they prepared?
Mr. WARE. Great. Good question.
I believe that SBA is more prepared now than they have ever
been in terms of the control environment that is currently in place
from a risk perspective. And I look at it in my role from a risk per-
spective to the taxpayers’ funds. So I believe that their control en-
vironment is stronger now than it has ever been. And certainly,
much stronger than it was at the onset of the pandemic.
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00034 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
31
Mr. GARBARINO. So for risk, you are saying that there still is
risk of fraud because I am looking at your comments and you say
your audits and investigations continue to find that the agency is
facing significant risk of fraud because of the size and scope of its
loan programs and related internal control environment. So that
still currently exists. They are still facing significant risk of fraud
but it is less fraud, risk of fraud than at the beginning when the
program started?
Mr. WARE. Yes. Let me clarify because it is important for us to
understand that fraudsters do what fraudsters are going to do.
There will be a risk of fraud to any program; right? Our role is to
make sure that that risk of fraud is mitigated to the lowest level
possible.
Mr. GARBARINO. Is it as mitigated now as it could be? I mean,
the reason I ask that is there are 110 open recommendations.
Would there be less risk if those 110 open recommendations were
taken into account?
Mr. WARE. Certainly. Important to understand that more than
half of those have to do with the financial statement audit which
is dealing with something quite different.
Mr. GARBARINO. No, I understand that. So, yeah, I think you
said 60 or so are part of it. So there is still 50 out there that could
be addressed that would even further reduce the risk of fraud if
they were addressed; correct?
Mr. WARE. Yes.
Mr. GARBARINO. Okay. So——
Mr. WARE. Although not all of the 50 have to do with fraud. But
the ones that do, definitely.
Mr. GARBARINO. There are some of them, out of these rec-
ommendations there are some that would reduce the risk of fraud?
Mr. WARE. Yes.
Mr. GARBARINO. Okay. So would you like to see those items
addressed before any new programs start?
Mr. WARE. Certainly. Certainly. I have advocated from the very
beginning that certain controls need to be in place before any pro-
gram is started. I said that before PPP was rolled out; right? Be-
fore COVID EIDL was rolled out. We had our report out imploring
the agency to take a look at these things before kicking them off.
Mr. GARBARINO. Okay. I appreciate that and I do appreciate
the work that your office has been doing on these reports. They are
very thorough. And I agree, I would love to see the SBA address
these risks because I think any risk of fraud, and like you said, bad
guys are going not do bad things. They are always going to find a
way to do it. We need to stay on top of them to make sure that
that risk is as diminished as possible. I just do not think based on
what you said, and as you said, your advocacy is what you put in
front of us with your reports. That is how you advocate. You are
not going to take a position. I think what your reports are saying
is clear to every Member on this Committee that before the SBA
starts any new direct lending program or increases the amount of
money that they do through current programs, they should listen
to you and address those issues, those recommendations, because
any risk of fraud of taxpayer dollars is unacceptable. Again, I ap-
preciate the work you have been doing. Thank you for your testi-
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00035 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
32
mony today and I hope the SBA administrators listen to you so less
dollars, less taxpayer dollars go to fraud.
And thank you, Madam Chair, I yield back.
Mr. WARE. Thank you.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now we recognize the gentlelady from New York, Ms. Tenney, for
5 minutes.
Ms. TENNEY. Thank you, Chairwoman, and Ranking Member
Luetkemeyer.
I just want to say thank you, Mr. Ware, for taking your time for
being here. And we are really grateful for your work and what you
are doing and exposing some of the issues we have had with the
Small Business Administration and how to improve it and make it
more friendly to our business community.
As a small businessowner, we greatly appreciate that. And we
know that they have struggled at times and that is one of the rea-
sons that I actually partnered with Senator Lee to introduce the
Transparency and COVID-19 Expenditures Act. And only through
the full audit of COVID-19 emergency programs can we really en-
sure that these mistakes are not made again and we appreciate
your effort in trying to get these reports out.
We do know that SBA has failed to respond to a lot of these poli-
cies that you have set forth in your reports which are highlighting
where we need to move them. And as my colleague, Mr. Garbarino
said, we want to make sure that we push them in the right direc-
tion.
I want to specifically first get into an issue that I had with Ad-
ministrator Guzman when she was here in November. She said she
was unaware, and I tried every angle on this question to her, that
SBA was illegally providing millions of dollars in Paycheck Protec-
tion Program loans to multiple Planned Parenthood affiliates, in-
cluding a $10 million PPP loan for Planned Parenthood of Greater
New York. And as you are aware, it is illegal for these federal
funds to be used for abortion and all applicants for PPP must abide
by the rules and the size standards. And since Planned Parenthood
has over 16,000 employees nationwide, they are ineligible. Have
you provided information about the Paycheck Protection loans to
Planned Parenthood to Administrator Guzman? Is she aware of
these as far as you know or have you provided her with this infor-
mation?
Mr. WARE. I have not personally provided information on
Planned Parenthood to the administrator. I believe, I hope that the
Committee knows that we have kicked off a job that looks into eli-
gibility of nonprofits that will deal with affiliation and size stand-
ards, and Planned Parenthood is a part of that.
Ms. TENNEY. Let me ask——
Mr. WARE. So we do have work that is going on right now that
addresses it. As a matter of fact, it came as a request I believe from
the Senate Small Business Committee.
Ms. TENNEY. Great. So are you aware of loans that were made
to Planned Parenthood?
Mr. WARE. Yes, I am.
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00036 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
33
Ms. TENNEY. Okay. And do you know if those loans were made,
if Administrator Guzman was aware of that and if those loans were
forgiven?
Mr. WARE. No, I do not know either of the two right now off the
cuff. Like I said, the work is ongoing.
Ms. TENNEY. Right.
Mr. WARE. When the team briefs me I will know.
Ms. TENNEY. Does Administrator Guzman have access to this
information, whether the topline numbers, does she know, does she
have access to see this information anywhere as the rest of us
would?
Mr. WARE. I cannot say definitively that she does. I would guess
so.
Ms. TENNEY. Do you recommend that SBA change any of its in-
ternal controls or anything to make sure that these types of loans,
illegal loans that violate either constitutional provisions or the pro-
visions of the PPP program to ensure that SBA does not give these
out in the future? That is something that I think through your in-
spector general role you could do that as far as recommendations
to the administrator.
Mr. WARE. I believe that recommendations will be forthcoming
at the conclusion of our review.
Ms. TENNEY. Have there been any——
Mr. WARE. But the review is ongoing.
Ms. TENNEY. So if it is ongoing, have there been any prelimi-
nary information given to Administrator Guzman? For example,
she denied knowing of any of these, and as the administrator I
found that quite startling. But would she be aware of those now
since it is an ongoing production of information?
Mr. WARE. I have not received an update myself from the audit
staff as to where we are on this assignment. So I do not have some-
thing to provide to the administrator currently.
Ms. TENNEY. So nothing is uploaded on any website or no infor-
mation is in the public domain on this issue other than what we
know because there have been loans given and received on their
990 forms? Or what other IRS forms are. It may not be a 990
Form.
Mr. WARE. No. My work would never be uploaded before it is
fully vetted and completed.
Ms. TENNEY. Okay. So there has been nothing disclosed since
November that she would know?
Mr. WARE. No. I have not had any discussions with her. I meet
with her every other week.
Ms. TENNEY. Okay. Well, I just want to thank you.
I also just wanted to reiterate the concerns that my colleague,
Mr. Garbarino had about the customer service issue. We still are
receiving information about loans and other things that are not
being handled in an efficient and continuous matter. We hope that
you will continue as the inspector general to urge the administra-
tion to answer customer information complaints faster and more ef-
ficiently as many people are out there waiting or have not had
loans processed for over a year. But again, I appreciate, I know my
time is running out but I appreciate your work in trying to get the
correct information to the administration so SBA can work and
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00037 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
34
function better for our communities and our small business commu-
nity who are struggling through this pandemic. I thank you.
And my time is out so I yield back my time. Thank you.
Chairwoman VELÁZQUEZ. The gentlelady’s time has expired.
Thank you again, Mr. Ware, for being here today. Your oversight
of SBA programs is very important, and it is more important now
than ever as we work to address the challenges with the stimulus
lending programs and learn valuable lessons for the future. It is
vital that we address the systemic challenges at SBA and work to-
gether to ensure that internal controls are put in place. Doing so
we will make the agency stronger, nimbler, and better able to han-
dle disasters in the future. To that end, it is encouraging to see
SBA is heeding your advice and working to close out the out-
standing recommendations. Most importantly, your work helps the
Committee track challenges all throughout the agency that need to
be addressed. If we have learned anything over the last 2 years it
is that we need to have a well-functioning, funded, and staffed
agency to address the day-to-day needs of small firms and be ready
for any catastrophe facing our nation. I truly hope that today’s
hearing motivates all of us to work to find bipartisan solutions to
bolster the agency.
Without objection, Members have 5 legislative days to submit
statements and supporting materials for the record.
If there is no further business to come before the Committee,
without objection, we are adjourned. Thank you.
[Whereupon, at 11:55 a.m., the committee was adjourned.]
SBD026 with DISTILLER
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00038 Fmt 6633 Sfmt 6633 F:\DOCS\46712.TXT DEBBIE
35
APPENDIX
SBD026 with DISTILLER Insert offset folio 35 here 46712.001
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00039 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
36
SBD026 with DISTILLER Insert offset folio 36 here 46712.002
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00040 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
37
SBD026 with DISTILLER Insert offset folio 37 here 46712.003
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00041 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
38
SBD026 with DISTILLER Insert offset folio 38 here 46712.004
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00042 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
39
SBD026 with DISTILLER Insert offset folio 39 here 46712.005
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00043 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
40
SBD026 with DISTILLER Insert offset folio 40 here 46712.006
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00044 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
41
SBD026 with DISTILLER Insert offset folio 41 here 46712.007
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00045 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
42
SBD026 with DISTILLER Insert offset folio 42 here 46712.008
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00046 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
43
SBD026 with DISTILLER Insert offset folio 43 here 46712.009
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00047 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
44
SBD026 with DISTILLER Insert offset folio 44 here 46712.010
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00048 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
45
SBD026 with DISTILLER Insert offset folio 45 here 46712.011
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00049 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
46
SBD026 with DISTILLER Insert offset folio 46 here 46712.012
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00050 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
47
SBD026 with DISTILLER Insert offset folio 47 here 46712.013
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00051 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
48
SBD026 with DISTILLER Insert offset folio 48 here 46712.014
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00052 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
49
SBD026 with DISTILLER Insert offset folio 49 here 46712.015
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00053 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
50
SBD026 with DISTILLER Insert offset folio 50 here 46712.016
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00054 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
51
SBD026 with DISTILLER Insert offset folio 51 here 46712.017
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00055 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
52
SBD026 with DISTILLER Insert offset folio 52 here 46712.018
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00056 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
53
SBD026 with DISTILLER Insert offset folio 53 here 46712.019
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00057 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
54
SBD026 with DISTILLER Insert offset folio 54 here 46712.020
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00058 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
55
SBD026 with DISTILLER Insert offset folio 55 here 46712.021
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00059 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
56
SBD026 with DISTILLER Insert offset folio 56 here 46712.022
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00060 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
57
SBD026 with DISTILLER Insert offset folio 57 here 46712.023
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00061 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
58
SBD026 with DISTILLER Insert offset folio 58 here 46712.024
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00062 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
59
SBD026 with DISTILLER Insert offset folio 59 here 46712.025
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00063 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
60
SBD026 with DISTILLER Insert offset folio 60 here 46712.026
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00064 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
61
SBD026 with DISTILLER Insert offset folio 61 here 46712.027
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00065 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
62
SBD026 with DISTILLER Insert offset folio 62 here 46712.028
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00066 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
63
SBD026 with DISTILLER Insert offset folio 63 here 46712.029
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00067 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
64
SBD026 with DISTILLER Insert offset folio 64 here 46712.030
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00068 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
65
SBD026 with DISTILLER Insert offset folio 65 here 46712.031
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00069 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
66
SBD026 with DISTILLER Insert offset folio 66 here 46712.032
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00070 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
67
SBD026 with DISTILLER Insert offset folio 67 here 46712.033
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00071 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
68
SBD026 with DISTILLER Insert offset folio 68 here 46712.034
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00072 Fmt 6602 Sfmt 6602 F:\DOCS\46712.TXT DEBBIE
69
Æ
SBD026 with DISTILLER Insert offset folio 69 here 46712.035
VerDate Mar 15 2010 10:13 Mar 03, 2022 Jkt 000000 PO 00000 Frm 00073 Fmt 6602 Sfmt 6011 F:\DOCS\46712.TXT DEBBIE
File and source
- File
- CHRG-117hhrg46712.pdf
- Size
- 15,391,344 bytes
- SHA-256
- bf985e8d7efffd5053b1159554aae0e17304f3173b13e8058b3a81365639379a
- Our copy
- CHRG-117hhrg46712.pdf
- Original
- www.govinfo.gov