The U.S. Small Business Administration (SBA) is implementing language from a bipartisan bill sponsored by U.S. Rep. María Elvira Salazar (R-FL) that would require the SBA to create a plan to reclaim unused or fraudulent Paycheck Protection Program (PPP) loans issued during the COVID-19 pandemic.
“Miami small business owners relied on these loans to keep the doors open during the pandemic, but bad actors took advantage of the system,” said Rep. Salazar on Dec. 21. “We owe it to the American taxpayers to ensure frauds and cheats pay back what they stole from our communities.”
The congresswoman sponsored the Returning Erroneous COVID Loans Addressing Illegal and Misappropriated (RECLAIM) Taxpayer Funds Act, H.R. 4667, on July 17 alongside lead original cosponsor U.S. Rep. Morgan McGarvey (D-KY).
If enacted, H.R. 4667 would require SBA to issue guidance for borrowers and lenders about returning any unused PPP loan amounts made to the borrower, and to track the amounts of PPP loans returned to mitigate the risk of financial loss, according to the congressional record bill summary.
The U.S. House of Representatives on Nov. 30 passed H.R. 4667. The U.S. Senate on Dec. 4 received H.R. 4667 for action and referred it for consideration to the U.S. Senate Small Business and Entrepreneurship Committee.
“When Congress passed my RECLAIM Taxpayer Funds Act last month, we sent a strong message to President Biden that we need accountability in our government,” Rep. Salazar said. “I applaud the Small Business Administration for implementing my common-sense policy.”
The SBA on Dec. 18 issued a procedural notice that went into effect that same day to provide guidance to borrowers, lenders, and other financial intermediaries on the return of PPP loan funds to SBA. PPP lenders are also provided guidance on their responsibility to accept returned PPP loan funds, according to the notice.