The U.S. House of Representatives House Small Business Committee passed a bill that would reclaim fraudulent and unused Paycheck Protection Program (PPP) loans distributed during the COVID-19 pandemic.
The bill, the Returning Erroneous COVID Loans Addressing Illegal and Misappropriated (RECLAIM) Taxpayer Funds Act (H.R. 4667), passed the committee in a bipartisan, unanimous vote.
“Our federal government should identify waste and return it to the taxpayer, not hide it like Isabel Guzman’s Small Business Administration is trying to do,” U.S. Rep. María Elvira Salazar (R-FL), the bill’s sponsor, said. “The RECLAIM Taxpayer Funds Act bill is a crucial step toward restoring integrity to government lending and dignity back to the taxpayer.”
Specifically, the RECLAIM Taxpayer Funds Act would require the Small Business Administration (SBA) to establish processes to account for fraudulent and unused Paycheck Protection Program (PPP) loans that were distributed during the height of the COVID-19 pandemic.
Of the $1.2 trillion in COVID Economic Injury and Disaster Loans (EIDL) given by the federal government since the start of the pandemic, $200 billion were found to be potentially fraudulent, according to a recent report from SBA Inspector General Hannibal Ware. However, SBA Administrator Isabel Guzman responded with a competing report the same day claiming only $36 billion of these loans were fraudulent.
The bill now moves to the full House of Representatives for a vote.