House advances Salazar’s bill to recover billions in fraudulent COVID loans

The U.S. House of Representatives on Nov. 30 advanced a bipartisan bill sponsored by U.S. Rep. María Elvira Salazar (R-FL) that would reclaim fraudulent COVID-19 loans and re-establish fiscal responsibility and government accountability. 

The Returning Erroneous COVID Loans Addressing Illegal and Misappropriated (RECLAIM) Taxpayer Funds Act, H.R. 4667, which Rep. Salazar sponsored in July with lead original cosponsor U.S. Rep. Morgan McGarvey (D-KY), now heads to the U.S. Senate for action.

“The federal government must step up and ensure that bad actors are not taking hard-earned taxpayer money,” Rep. Salazar said. “By passing the RECLAIM Taxpayer Funds Act, the House of Representatives is sending a clear message to the Biden administration to be better accountable for federal programs that are meant to serve, not steal.”

If enacted, H.R. 4667 would require the Small Business Administration (SBA) to issue guidance for borrowers and lenders about returning any unused Paycheck Protection Program (PPP) loan amounts made to the borrower during the height of the COVID-19 pandemic, according to the congressional record bill summary.

Under the measure, the SBA would be required to track the amounts of PPP loans returned in order to mitigate the risk of financial loss, the summary says.

The SBA on June 27 reported that of the $1.2 trillion in COVID Economic Injury and Disaster Loans (EIDL) provided by the federal government since the start of the pandemic, $200 billion is potentially fraudulent, according to its white paper entitled “COVID Pandemic EIDL and PPP Loan Fraud Landscape.”

The U.S. House Small Business Committee on July 18 voted to advance H.R. 4667 to the full chamber.