[House Report 118-182]
[From the U.S. Government Publishing Office]


118th Congress }                                          { REPORT 
                        HOUSE OF REPRESENTATIVES
 1st Session   }                                          { 118-182

======================================================================
 
      TO REQUIRE THE INSPECTOR GENERAL OF THE SMALL BUSINESS ADMIN-
       ISTRATION TO SUBMIT A QUARTERLY REPORT ON FRAUD RELATING TO 
       CERTAIN COVID-19 LOANS

                                _______
                                

 September 1, 2023.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

Mr. Williams of Texas, from the Committee on Small Business, submitted 
                             the following

                              R E P O R T

                        [To accompany H.R. 4666]

    The Committee on Small Business, to whom was referred the 
bill (H.R. 4666) to require the Inspector General of the Small 
Business Administration to submit a quarterly report on fraud 
relating to certain COVID-19 loans, having considered the same, 
reports favorably thereon without amendment and recommends that 
the bill do pass.

                                CONTENTS

                                                                   Page
  I. Purpose and Bill Summary.........................................1
 II. Need for Legislation.............................................2
III. Hearings.........................................................2
 IV. Committee Consideration..........................................2
  V. Committee Votes..................................................2
 VI. Section-by-Section of H.R. 4666..................................5
VII. Congressional Budget Office Cost Estimate........................5
VIII.New Budget Authority, Entitlement Authority, and Tax Expenditures5

 IX. Oversight Findings and Recommendations...........................5
  X. Performance Goals and Objectives.................................5
 XI. Statement of Duplication of Federal Programs.....................6
XII. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff 
     Benefits.........................................................6
XIII.Federal Mandates Statement.......................................6

XIV. Federal Advisory Committee Statement.............................6
 XV. Applicability to Legislative Branch..............................6
XVI. Statement of Constitutional Authority............................6

                      I. PURPOSE AND BILL SUMMARY

    H.R. 4666 was introduced by Rep. Aaron Bean (R-FL) and Rep. 
Kweisi Mfume (D-MD) on July 17, 2023. The purpose of H.R. 4666 
is to require the Inspector General of the Small Business 
Administration to submit a quarterly report to Congress for two 
years which provides updated information concerning the ongoing 
fraud investigations of Paycheck Protection Program (PPP) loans 
and COVID-19 Economic Injury Disaster Loans (EIDL).

                        II. NEED FOR LEGISLATION

    H.R. 4666 requires the Office of the Inspector General 
(OIG) of the SBA submit a report to Congress every quarter for 
two years which provides updated information concerning the 
ongoing fraud investigations of PPP loans and COVID-19 EIDLs. 
Specifically, the report must include the total dollar amount 
of all covered loans that were made, the number of both new 
fraud cases and suspected fraud cases, the type of fraud 
identified in those cases, and the number of fraud cases 
resolved to date.
    According to the SBA OIG White Paper Report 23-09, COVID-19 
Pandemic EIDL and PPP Loan Fraud Landscape, an estimated $200 
billion in potentially fraudulent COVID-19 EIDLs and PPP loans 
were disbursed by the SBA.\1\ As the OIG continues working on 
the tens of thousands of investigative leads on alleged fraud, 
waste, and abuse of taxpayer resources, it is important for 
Congress to be kept apprised of the extent of the fraud and the 
progress in resolving ongoing cases.
---------------------------------------------------------------------------
    \1\U.S. Small Bus. Admin. Office of Inspector Gen., Report 23-09, 
White paper on COVID-19 Pandemic EIDL and PPP Loan Fraud Landscape 
(Jun. 27, 2023).
---------------------------------------------------------------------------

                             III. HEARINGS

    In the 118th Congress, the Committee held one hearing 
examining the issues covered in H.R. 4666. On July 13, 2023, 
during the Full Committee hearing, ``Stolen Taxpayer Funds: 
Reviewing the SBA and OIG Reports of Fraud in Pandemic Lending 
Programs,'' the Committee examined two recent and contradicting 
reports that exposed fraud in the COVID-19 pandemic lending 
programs. The SBA OIG report concluded the SBA disbursed more 
than $200 billion in potentially fraudulent loans through 
pandemic relief programs, while the SBA reported the fraud in 
these programs is closer to $36 billion.
    In addition to the discrepancy of more than $160 billion in 
fraud between the two reports, the Inspector General testified 
that he is committed to keeping the House Committee on Small 
Business updated amid the more than 100 years of investigative 
casework required to look into the over 90,000 actionable leads 
from hotline complaints that they received.

                      IV. COMMITTEE CONSIDERATION

    The Committee on Small Business met in open session, with a 
quorum being present, on July 18, 2023, and ordered H.R. 4666 
reported to the House of Representatives. During the markup, no 
amendments were offered.

                           V. COMMITTEE VOTES

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the recorded 
votes on the motion to report legislation and amendments 
thereto. The Committee voted to favorably report H.R. 4666 to 
the House of Representatives at 11:00 AM.


                  VI. SECTION-BY-SECTION OF H.R. 4666

Section 1. Report on fraud relating to certain COVID-19 loans

    This section requires that the Inspector General of the SBA 
submit a report to Congress every quarter that details the 
number of borrowers it has found to have engaged in fraud with 
respect to PPP loans and EIDLs. This report must include the 
total dollar amount of all covered loans made, the number and 
type of fraud found in both new and suspected fraud cases, and 
the number of fraud cases resolved to date.

Section 2. Compliance with CUTGO

    This section does not authorize any additional 
appropriations for this bill.

             VII. CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

    Pursuant to clause 3(d)(1) of House rule XIII, the 
Committee adopts as its own the cost estimate prepared by the 
Director of the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974. The Committee has 
requested but not received from the Director of the 
Congressional Budget Office a cost estimate for the Committee's 
provisions. Once available, the cost estimate will be published 
in the Congressional Record.

VIII. NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX EXPENDITURES

    Pursuant to clause 3(c)(2) of rule XIII of the Rules of the 
House of Representatives and section 308(a)(I) of the 
Congressional Budget Act of 1974, the Committee provides the 
following opinion and estimate with respect to new budget 
authority, entitlement authority, and tax expenditures. While 
the Committee has not received an estimate of new budget 
authority contained in the cost estimate prepared by the 
Director of the Congressional Budget Office pursuant to Sec. 
402 of the Congressional Budget Act of 1974, the Committee does 
not believe that there will be any additional costs 
attributable to this legislation. H.R. 4666 does not direct new 
spending.

               IX. OVERSIGHT FINDINGS AND RECOMMENDATIONS

    In accordance with clause 3(c)(1) of rule XIII and clause 
2(b)(1) of rule X of the Rules of the House of Representatives, 
the oversight findings and recommendations of the Committee on 
Small Business with respect to the subject matter contained in 
the H.R. 4666 are incorporated into the descriptive portions of 
this report.

                  X. PERFORMANCE GOALS AND OBJECTIVES

    With respect to the requirements of clause 3(c)(1) of rule 
XIII of the Rules of the House of Representatives, the 
performance goals and objectives of H.R. 4666 are to require a 
quarterly report from the SBA OIG to Congress over a two-year 
period that includes updated data from investigative casework 
that includes the total dollar amount of all covered PPP and 
EIDL loans that have been made, the number of both new fraud 
cases and suspected fraud cases, the type of fraud identified 
in those cases, and the number of fraud cases resolved to date.

            XI. STATEMENT OF DUPLICATION OF FEDERAL PROGRAMS

    Pursuant to clause 3(c)(5) of rule XIII of the Rules of the 
House of Representatives, no provision of H.R. 4666 is known to 
be duplicative of another Federal program, including any 
program that was included in a report to Congress pursuant to 
section 21 of Public Law 111-139 or the most recent Catalog of 
Federal Domestic Assistance.

 XII. CONGRESSIONAL EARMARKS, LIMITED TAX BENEFITS, AND LIMITED TARIFF 
                                BENEFITS

    With respect to clause 9 of rule XXI of the Rules of the 
House of Representatives, the Committee finds that the bill 
does not contain any congressional earmarks, limited tax 
benefits, or limited tariff benefits as defined in clause 9(e), 
9(f), or 9(g) of rule XXI of the Rules of the House of 
Representatives.

                    XIII. FEDERAL MANDATES STATEMENT

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

               XIV. FEDERAL ADVISORY COMMITTEE STATEMENT

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                XV. APPLICABILITY TO LEGISLATIVE BRANCH

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

               XVI. STATEMENT OF CONSTITUTIONAL AUTHORITY

    Pursuant to clause 7 of rule XII of the Rules of the House, 
the Committee finds that the authority for this legislation in 
Art. I, Sec. 8, cl.1 of the Constitution of the United States.

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