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S.B.A. Overpaid $4.5 Billion on ‘Illogical’ Small Business Grant Claims

An emergency relief program hastily rolled out in the early days of the pandemic had such poor fraud protections that it improperly doled out nearly $4.5 billion to self-employed people who said they had additional workers — even those who made wildly implausible claims, like having one million employees.

The $20 billion program, called the Economic Injury Disaster Loan Advance, offered small businesses immediate grants of up to $10,000 in the months after the pandemic shuttered much of the economy. But hundreds of thousands of the grants it made were inflated because there was no system to catch applications with “flawed or illogical information,” Hannibal Ware, the Small Business Administration’s inspector general, wrote in a report released on Thursday.

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