The SBA Scandal Blog

Breaking: October 2025 Shutdown Leaves Small Businesses in the Lurch—Again

The 2025 government shutdown has once again exposed the SBA's complete failure to support small businesses during crisis. 6,000 small business loans totaling $4 billion were halted overnight. Companies relying on federal contracts received immediate "stop work" orders, with no timeline for resumption.

This isn't just about delayed paperwork—these are real businesses with real employees who won't get paid. Suppliers won't get paid. Rent won't get paid. And the SBA? They're at home, not answering phones, not processing applications, not doing their jobs.

The pattern is clear: When small businesses need the SBA most, the agency is nowhere to be found. Remember 2020? Remember the pandemic loan disasters? History is repeating itself, and small business owners are paying the price.

The $200 Billion Question: Where Did All the Money Go?

Let's talk about the elephant in the room: $200 billion in estimated pandemic-era fraud from SBA programs. That's not a typo. Two. Hundred. Billion. Dollars.

The SBA Inspector General tried to investigate. They received 3 million fraud referrals. Want to know how many they could actually investigate? Less than 1 million. Why? Because the SBA didn't provide enough information, or correct information, in its referrals.

Translation: The SBA was so incompetent at basic record-keeping that they made it impossible to recover stolen taxpayer money. Meanwhile, legitimate small businesses were denied loans because of "missing paperwork."

The criminals got billions. The honest business owners got denials. That's your SBA at work.

New SBA Rules Will Tank Small Business Values in January 2026

If you're a small business owner with set-aside contracts, brace yourself. New SBA regulations take effect January 17, 2026, and they're going to significantly decrease the value of your company.

These aren't minor tweaks. These are fundamental changes to how set-aside contracts work, and they're coming with almost no warning and almost no input from the business owners who will be affected.

Business owners who spent decades building value, playing by the rules, and creating jobs are watching their life's work lose value because the SBA decided to change the rules mid-game. No transition period. No grandfathering. Just sudden, devastating changes.

This is what happens when bureaucrats make decisions without understanding the real-world consequences.

PPP and EIDL: A Post-Mortem of the Biggest Loan Disaster in History

Looking back at the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) programs is like watching a slow-motion train wreck where the conductor was asleep and the passengers were left to fend for themselves.

Here are the facts:

• The SBA didn't implement fraud prevention until over $525 billion of $800 billion in PPP funds were already gone
• Over $210 billion of $385 billion in EIDL funds were disbursed before fraud controls existed
• Banks prioritized big clients and made millions in processing fees while small businesses got nothing
• The SBA hotline was so overwhelmed it effectively stopped functioning
• Millions of legitimate applications were lost, denied, or stuck in limbo for 12+ months

And now? Delinquencies, defaults, and charge-offs are rising in SBA loan programs, but the agency won't publish the real numbers. They're hiding the disaster while small businesses drown in unpayable debt.

Why "Everybody Hates the SBA" Isn't Just a Catchy Headline

The American Prospect ran an article titled "Everybody Hates the SBA," and honestly, they're not wrong. But let's dig into why everyone hates the SBA.

It's not just one thing. It's everything:

1. They're incompetent. Lost applications. Incorrect information. Systems that don't work. Hotlines that don't answer. The SBA can't execute basic administrative functions.

2. They're slow. 18-month wait times for loan decisions. Years to investigate fraud. Decades-old technology. The SBA moves at the speed of molasses while businesses move at the speed of life.

3. They're arbitrary. Identical applications get different results. Rules change without warning. Approved loans get revoked with no explanation. There's no consistency, no fairness, no logic.

4. They're unaccountable. $200 billion in fraud? No consequences. Millions of botched applications? No consequences. Destroying business values with bad regulations? No consequences.

The SBA operates with total impunity while small businesses suffer the consequences of every SBA failure.

The SBA Ombudsman: A Toothless Watchdog

Did you know the SBA has an "Office of the National Ombudsman"? It's supposed to help small businesses with regulatory problems and agency overreach.

Spoiler alert: It doesn't work.

The Ombudsman office is understaffed, underpowered, and completely toothless. They can't force the SBA to do anything. They can't reverse decisions. They can't stop bad regulations. They can issue reports that get ignored.

Filing a complaint with the SBA Ombudsman is like filing a complaint with the complaint department that reports directly to the people you're complaining about. It's theater. It's a pressure valve to make you think someone cares. But nothing changes.

Coming Soon: More Scandals, More Failures, More Rage

This blog will be regularly updated with new posts exposing SBA failures, analyzing policy disasters, and amplifying the voices of small business owners who've been screwed by the system.

Have a story tip? Know about SBA corruption? Want to share your experience? Head over to our Submit page and let us know.

The SBA thrives in darkness. We're turning on the lights.

How the SBA Ate My Ass

I thought the Small Business Administration was supposed to help people. You know, like mom-and-pop shops and dreamers with an Etsy side hustle. Instead, they bent me over and took turns eating my financial dignity with a plastic fork.

First, they baited me in with the EIDL loan. Said it was for struggling businesses during the pandemic. I applied, got approved, and thought, "Damn, maybe Uncle Sam actually gives a shit." But nope. That loan came with strings longer than a CVS receipt and interest that creeps up on you like your ex at 2 AM.

Then came the "reassessment." They wanted their money back faster than they gave it. They hit me with deadlines, threats, emails that read like breakup texts, and forms designed to make you cry in Comic Sans. I submitted everything, twice. They still claimed they "couldn't verify my documents." You mean my EIN and tax returns from the IRS weren't good enough? What else do you need? Blood type? A dick pic?

Next thing I know, I'm flagged. Not by the IRS, not by my bank—but by the goddamn SBA. Like I'm some criminal mastermind for accepting $8,000 to stay alive in 2021. They don't care if I spent it on inventory, payroll, or ramen noodles. They just want it back, with interest, and maybe my soul on top.

So yeah. That's how the SBA ate my ass. Not in the fun way. Not in the way where you moan and light a cigarette after. In the way where you cry into a spreadsheet, wondering if selling your liver on Craigslist counts as a "business pivot."

Thanks for nothing, SBA. You're not small, you're not helpful, and you definitely don't administer anything other than psychological trauma.

SBA Mental Gymnastics: Stupid in Its Final Form

Dealing with the SBA isn't just frustrating, it's like watching a brick try to do calculus. These people are so mentally backwards it's honestly impressive. They've transcended basic incompetence and evolved into a full blown bureaucratic circus act. And the main event? Watching them flip flop, contradict themselves, and invent new rules on the fly like it's an improv show written by toddlers.

One minute you're told everything is in order. The next minute? You're missing something no one ever mentioned. They'll ask for forms you already sent, twice. Then lose those forms. Then email you three weeks later asking for the same thing again, but now with a made up form name that doesn't exist in any known tax system.

Their brains operate in a dimension we cannot access. It's a level of stupidity so dense it bends time. It's beyond belief. Beyond repair. Beyond reason. Beyond any therapy or retraining program. These are not employees. They are time wasting avatars of confusion sent to drain your will to live and your hopes for fairness.

And let's not forget the calls. Oh God, the calls. Let me escalate this, they say, as if escalation isn't just code for you'll never hear from us again. These people have invented entire languages of deflection and delay. I've seen toddlers with more strategic planning than a full SBA loan team.

If the SBA was a car, the wheels would be square, the engine would be full of pudding, and the steering wheel would be optional. And somehow they'd still deny you for not having a valid license to ride in it.

This isn't just a broken system. It's a toxic organism made of red tape, gaslighting, and unchecked stupidity. Welcome to the Hall of Shame, where logic dies and rage lives forever.

How the SBA Turns Simple Tasks into Epic Adventures

Dealing with the SBA feels like signing up for a quest that never ends. You send them what they ask for, and suddenly they want something else. You provide what they request, and then they ask for even more proof, usually something that only exists in a fantasy novel. It is like they have their own language and rules that change every time you talk to them. I've spent hours on hold, emails going back and forth, only to find out I forgot to include some obscure document that nobody mentioned before. If patience is a virtue then I must be a saint by now. The whole process tests your sanity and sense of humor, but somehow you keep going because what choice do you have? The SBA might be a maze, but we all have to find our way through it.

The Time They Asked for My Middle School Transcript

Not even kidding. The SBA rep told me they needed "additional documentation" to prove my identity. I sent them my passport, my LLC paperwork, and my tax return. They replied asking for my MIDDLE SCHOOL TRANSCRIPT. I haven't seen that since AOL dial-up. What the hell are we doing here?

They Lost My Application... Again

This was the third time they told me my application "wasn't received." I had tracking confirmation, email confirmation, and even a phone rep who read it back to me. Two weeks later? "Sorry, we have no record of this." I swear, their filing cabinet must be a black hole.