LOLSBA BLOG

🔍 SBA Brings in PALANTIR for Nationwide Fraud Hunt - You Can Run But You Can't Hide

Remember that $200 billion in "potentially fraudulent" COVID loans? The SBA is done playing nice. Days after suspending 7,000 Minnesota borrowers, the agency just signed a contract with Palantir Technologies - the surveillance company that built the data-mining systems for the CIA, NSA, and ICE.

This isn't some government bureaucrat squinting at spreadsheets anymore. Palantir built their reputation helping intelligence agencies track terrorists. Now they're pointed at PPP fraudsters. Sleep tight, Florida real estate "investors."

Why This Is Different

The SBA previously relied on its inspector general's office - underfunded, understaffed, and overwhelmed. They estimated $136 billion in EIDL fraud and $64 billion in PPP fraud. That's $200 billion gone. But they could barely investigate a fraction of the cases.

Now? Palantir's algorithms can process millions of loan applications simultaneously, flagging discrepancies that would take human investigators decades to find. The company brags about identifying patterns "invisible to the naked eye."

Administrator Kelly Loeffler made it clear: "We will work with law enforcement to hold fraudsters accountable and put the criminals who have cheated American taxpayers behind bars."

The Numbers That Should Scare You

• 7,900 loans suspended in Minnesota alone - $400 million
• 10-year statute of limitations extended by Congress specifically for PPP/EIDL fraud
• Criminal referrals for "every case where appropriate"
• Investigations expanding nationwide with "zero tolerance policy"

The best part? Harold Kaeding of Eden Prairie thought he got away clean when he fled to Colombia with $1.6 million in stolen PPP and EIDL funds. Colombian authorities extradited him. He's now serving 87 months in federal prison.

Think about that the next time you consider crossing an international border to avoid consequences. The SBA is literally working with foreign governments now.

Sources: FedScoop, Star Tribune

🚨 $1.2 TRILLION Under Investigation: "The Worst Kept Secret in Washington"

This is not a typo. $1.2 TRILLION in federal payouts is now under review for fraud. SBA Administrator Kelly Loeffler dropped this bombshell during an interview on January 7, 2026, and the implications are staggering.

According to Loeffler, federal contracting fraud "is probably the worst kept secret in Washington." The investigation is looking back 15 years, including the first-ever audits of the 45-year-old 8(a) business development program. That's right - in nearly half a century, nobody bothered to properly audit a program managing billions in federal contracts.

What's Under the Microscope

• 8(a) Business Development Program: 4,300 organizations receiving federal contracts
• COVID-19 Relief Programs: PPP and EIDL loans totaling hundreds of billions
• Social and Economic Benefit Programs: Funding across multiple agencies

The kicker? The previous administration allegedly forgave thousands of flagged loans without further investigation. The current administration is now reviewing every single one of those decisions. If you thought you got away with something, think again.

Minnesota alone has already seen 7,000 borrowers suspended for $400 million in suspected fraud. That's one state. Imagine what happens when they finish auditing the other 49.

Source: The Epoch Times

SBA Relocates Minneapolis Office After "Overwhelming Local Hostility" - Small Businesses Caught in the Crossfire

In what can only be described as bureaucratic retaliation wrapped in political theater, SBA Administrator Kelly Loeffler announced this week that the SBA will relocate its Minneapolis district office. The reason? "Overwhelming local hostility" toward Immigration and Customs Enforcement (ICE).

Here's the timeline of insanity:

• ICE officer shoots and kills 37-year-old Renee Good in Minneapolis
• Local businesses start temporarily closing as ICE activity ramps up
• SBA responds by... punishing Minnesota small businesses?

Multiple small businesses in the Twin Cities metro have already announced temporary closures, including Casa Deli (Hopkins and Savage locations) and GrandeSunrise Mexican Restaurant in West St. Paul. These businesses are shutting down out of fear - and the SBA's response is to make it harder for them to get help.

Remember: the SBA already defunded Minnesota efforts and communicated this to Governor Tim Walz in late December. The 6,900 borrowers suspended for fraud? That's not new. But relocating the office to punish an entire region for local politics? That's something else entirely.

The message is clear: if your state doesn't play ball politically, your small businesses will pay the price.

$47 BILLION Charged Off, Less Than 1% Recovered: OIG Report Exposes Collections Catastrophe

The SBA Office of Inspector General released Audit Report 25-23 in August 2025, and the numbers are damning. The agency has charged off over $47 billion in delinquent COVID-19 EIDL loans. How much have they recovered?

Let that sink in. The federal government gave away $47 billion of your tax dollars, and when borrowers didn't pay it back, they managed to recover less than 1%. That's not incompetence - that's institutional failure on a scale that defies comprehension.

The OIG's Recommendations (And SBA's Response)

The OIG recommended that SBA establish a "reasonable standard" for referring delinquent loans to the Department of Justice for litigation. The SBA's response? Rejected.

The agency claims that DOJ referrals are "resource-intensive and less effective" than Treasury's administrative offset processes. Translation: it's easier to garnish your tax refund than to actually sue fraudsters in court.

Key Deadlines You Need to Know

• March 31, 2026: Treasury returns delinquent COVID-19 EIDLs back to SBA for continued collection
• June 30, 2026: Final Action Target Date for SBA to confer with DOJ on litigation standards
• 10 years: Statute of limitations for EIDL fraud (extended from 6 years by the COVID-19 EIDL Fraud Statute of Limitations Act of 2022)

The government can offset your tax refunds, garnish your wages, and seize your assets - all without filing a lawsuit. They don't need to take you to court to destroy you financially. They'll just take what's yours directly.

Trump Administration Moves to Abolish Women's Business Centers, SCORE, and Minority Business Programs

While the SBA hunts down fraud (selectively, of course), the Trump administration is quietly dismantling the programs that actually help legitimate small businesses. The President's Fiscal Year 2026 budget proposes to:

• Abolish the Minority Business Development Agency (MBDA)
• Eliminate SBA's Women's Business Centers
• Defund SCORE (the mentorship program for new business owners)

In March, President Trump issued an executive order directing the MBDA and several other agencies to "reduce their functions to the minimum amount required by law." Democratic senators have fired back, stating that "gutting counseling and training services for women, veterans, and underserved small businesses is not how we can grow our economy."

Here's the pattern: When billions go missing to fraud, the response is slow and ineffective. When programs actually help women, minorities, and veterans start businesses, they get the axe. The priorities couldn't be clearer.

The SBA is spending $300,000 on a Palantir contract to hunt down fraud, but can't find the funding to keep mentorship programs running. This is what "accountability" looks like in Washington - punish the people who played by the rules while the real grifters disappear with the money.

REAL HORROR STORIES: "I Wish I Never Got That Loan" - Three Business Owners Destroyed by SBA Incompetence

These aren't hypotheticals. These aren't exaggerations. These are real American small business owners, with real names, whose lives were turned upside down by the SBA's staggering incompetence. Their stories were reported by NBC News - and they're just the tip of the iceberg.

Freddie Harb - San Diego, California

Business: Sleeping Giant Music (entertainment booking agency)

The Nightmare: Freddie did everything right. He got an EIDL loan to keep his business alive during COVID. He tried to make his payments. For THREE YEARS, his payments were never processed by the SBA. Then they marked him in default and sent him to collections - accumulating penalties and interest on a loan he'd been trying to pay the entire time.

Robert Mavaddat - Pasadena, California

Business: Three Fantastic Sams hair salons

Loan Amount: $500,000

The Nightmare: Robert is a 66-year-old immigrant from Iran who spent decades building his salons into successful businesses. The SBA misfiled his loan under a federal employee ID instead of his Social Security number. Result? He was marked $31,000+ past due and referred to collections with erroneous demands totaling nearly $1.5 MILLION - including demands claiming he owed $734,000 on EACH of two salons. An SBA representative actually told him to consider declaring bankruptcy.

It took hiring a consultant to discover the SBA had simply misfiled his loan under the wrong identification number. Decades of work, nearly destroyed by a clerical error.

Scott Kobryn - Boone, North Carolina

Business: SteakAger (dry-aging beef equipment manufacturer)

Loan Amount: $500,000

The Nightmare: Scott applied for hardship accommodation. It was APPROVED in April, reducing his payments from $2,505 to $251 monthly. He made his payments. By October, his account showed months past due anyway. The SBA lost his payments. Then Hurricane Helene damaged his warehouse - and when he tried to get a disaster loan, the program was exhausted.

The Pattern Is Clear

These aren't isolated incidents. These are symptoms of an agency that:

• Loses payments then blames borrowers for non-payment

• Misfiles loan documents then sends people to collections for millions they don't owe

• Approves hardship requests then ignores them and marks accounts delinquent anyway

• Tells victims to declare bankruptcy over the agency's own errors

The SBA had ONE JOB: help small businesses survive the pandemic. Instead, they're destroying the survivors.

If you have a horror story, submit it. We're collecting them. The world needs to know.

The 37% Default Rate: 1.3 Million Small Businesses Are Going Down

Let's talk numbers. The EIDL default rate is now estimated at 37%. That's not a typo. More than one in three EIDL borrowers is in default or headed there.

The SBA estimates this amounts to 1.3 million small businesses who will default on their EIDL loans. 1.3 million. That's not a rounding error. That's a catastrophe.

The Money They're Chasing

As of late 2023:

• $77 billion in EIDL loans were past due (20% of all loans)

• $47.7 billion had already been charged off

• The program's cash flow went negative by $397 million in FY2024

What Happens When You Default

The consequences are brutal and they don't require a court order:

• Tax refund offset: Kiss your refund goodbye

• Social Security garnishment: They'll take a percentage of your benefits

• Wage garnishment: Up to 15% of your paycheck

• Bank account levy: They can seize your accounts

• Credit destruction: Default reported to all bureaus

And here's the kicker: The SBA has 20 years to enforce any judgment. This isn't going away. Ever.

The "Help" That's Available

Remember the Hardship Accommodation Plan? Ended March 19, 2025.

Remember the Offer in Compromise program? No EIDL loans have been approved for OIC as of September 2025.

Remember when the SBA said they'd work with struggling borrowers? They cut 43% of their workforce instead.

Your options in 2026: Pay in full, or bankruptcy. That's it. Welcome to America's small business support system.

The 10-Year Clock: Why PPP Borrowers Who Thought They Were Safe Are Dead Wrong

Here's a fun fact that should terrify approximately 11 million Americans: if you got a PPP loan in 2020 and thought the government had to charge you by 2025 or 2026, you were dead wrong. Congress extended the statute of limitations to 10 years. That means your 2020 PPP loan can be investigated until 2030. Your 2021 second-draw loan? 2031. Submitted a forgiveness application in late 2021 with questionable information? You're looking at 2032.

Let me say that again for the people in the back: THE GOVERNMENT HAS UNTIL 2030-2032 TO COME AFTER YOU.

How This Happened

On August 5, 2022, Congress passed two bills with bipartisan support - the PPP and Bank Fraud Enforcement Harmonization Act of 2022 and the COVID-19 EIDL Fraud Statute of Limitations Act of 2022. President Biden signed both into law. The original statute of limitations was 5-6 years, which would have meant most cases needed to be charged by 2025 or 2026. That's gone now.

Why They Did This

The original 5-year statute was based on wire fraud charges. But most PPP loans went through traditional banks, which means bank fraud could be charged - and bank fraud already had a 10-year statute. The problem? Many loans went through fintechs and non-bank lenders. Those could only be prosecuted as wire fraud with the 5-year limit. Congress "fixed" this by making everything 10 years.

Translation: they wanted more time to catch more people. And they got it.

What This Means For You

If you got a PPP loan and did anything questionable - inflated payroll numbers, miscounted employees, used funds for non-approved purposes, submitted a forgiveness application with errors - you need to:

• Keep ALL documentation for at least 10 years from the date of loan, use, and forgiveness (whichever is later)

• Don't assume forgiveness means you're safe - the government can and does investigate forgiven loans

• Understand that "everyone did it" is not a defense

• Know that algorithms are scanning for patterns - the data analysis is ongoing

The DOJ has prosecuted over 3,500 defendants and seized over $1.4 billion so far. They're not done. They're not even close to done. And now they have until the 2030s to keep going.

Sleep tight, borrowers.

EIDL Hardship Accommodation Program Is Dead. Here's What's Left. (Spoiler: Not Much.)

Remember the EIDL Hardship Accommodation Plan? The program that let struggling borrowers reduce their payments by 50% for six months while they got back on their feet? Yeah, that's gone now. The HAP program ended on March 19, 2025. No more applications. No more relief. If you're struggling with your EIDL payments now, the SBA has two words for you: too bad.

Well, technically they have more words than that. They'll tell you about "alternative options like loan modifications or other arrangements through your loan servicer." But let me translate what that actually means: good luck getting anyone to answer the phone, and even if they do, the "modifications" available are basically nothing.

What HAP Actually Did

The Hardship Accommodation Plan was a temporary payment-relief program that:

• Reduced monthly payments by 50% for six months

• Let interest continue accruing (because of course it did)

• Could be used once every five years

• Required application through the MySBA Loan Portal

Approximately 300,000 loans totaling $36 billion were enrolled in HAP at its peak. Those borrowers have now been returned to their "regular payment schedules." Which, for many of them, means payment schedules they couldn't afford in the first place.

What's Left?

Option 1: Offer in Compromise (OIC) - In theory, you can negotiate a settlement for less than you owe. In practice, this program has become "largely inaccessible for EIDL borrowers as of 2025." The approval rates are abysmal, the requirements are byzantine, and the SBA has no interest in forgiving debt when they can send you to Treasury instead.

Option 2: Deferment - You can request a deferment, but interest keeps accruing. You're not reducing your debt; you're just postponing the pain while it grows.

Option 3: Pay - That's it. That's the option. Find the money somehow and pay.

Congressional "Options" That Don't Exist

The Congressional Research Service has published a lovely document discussing "policy options" for EIDL relief: reduced interest rates, loan deferments without accrued interest, grant assistance, loan forgiveness. These are theoretical discussions. With Republicans controlling Congress and the current administration focused on fraud recovery, not borrower relief, none of these options are moving forward.

You're on your own. Welcome to America's small business support system.

California Wildfire Loans: $3.2 Billion Approved, 7 Structures Rebuilt. Yes, SEVEN.

I need you to sit down for this one. One year after the Los Angeles County wildfires destroyed an estimated 16,000 structures, the SBA has approved over $3.2 billion in disaster loans. Sounds great, right? Here's the kicker: only 22% of that funding has actually been disbursed. And the number of structures that have been completely rebuilt? Seven.

Not seven thousand. Not seven hundred. Seven. As in, the number of days in a week. As in, you could count them on your fingers and still have three left over.

Why Is This Happening?

Because California's permitting system is a catastrophic disaster on top of an actual disaster. The SBA has approved over 12,000 loans. The borrowers have the money waiting for them. They literally cannot access it because local governments won't give them permits to rebuild.

As of today, only 2,600 rebuild permits have been issued across the City and County of Los Angeles. That's permits ISSUED - not projects completed. Out of 16,000 destroyed structures. Less than 15% of homeowners have received the necessary approvals to even START rebuilding.

The SBA's Response

Administrator Kelly Loeffler is pointing fingers at local officials: "Local bureaucrats stall recovery." And you know what? She's not wrong. But let's not pretend the SBA is some innocent bystander here. This is the same agency that:

• Took months to process disaster loan applications in the first place

• Lost billions to fraud in their pandemic programs

• Is now cutting 43% of its workforce

• Has customer service wait times measured in hours, not minutes

When you're the SBA calling other government agencies slow and bureaucratic, you're basically the pot calling the kettle black - if the pot was on fire and the kettle had been waiting six months for a permit to put out the flames.

The Human Cost

Behind these numbers are real people. Families who lost everything. Business owners whose livelihoods burned to the ground. They did everything right. They applied for SBA loans. They got approved. They have money waiting for them. And they're still living in temporary housing, watching their approved funds collect dust, because some city clerk hasn't processed their permit yet.

This is what government "help" looks like. Seven structures in a year. $3.2 billion approved, 78% sitting unused. And everyone pointing fingers at everyone else while thousands of people wait.

SBA Brags About "Cutting Red Tape" While Drowning Borrowers in It

You cannot make this up. On January 7th, the SBA's Chief Counsel for Advocacy, Dr. Casey Mulligan, testified before the House Committee on Small Business about how the SBA is heroically "cutting red tape" for small businesses. Meanwhile, 7,000 Minnesota borrowers are suspended without due process, 4,300 8(a) participants just had to produce three years of financial records under threat of expulsion, and the phone hold times have gotten so long that people are literally dying of old age waiting for customer service.

Let me read you some highlights from the testimony, with my commentary:

The Irony Could Kill a Small Business

Mulligan's claim: The Biden Administration finalized 12,000 rules costing nearly $6 trillion in regulatory burden.

Reality: The SBA's own internal bureaucracy has cost small businesses hundreds of billions in lost time, denied loans, and collections harassment. But sure, blame Biden.

Mulligan's claim: Advocacy has flagged approximately 300 issues for deregulatory action.

Reality: How about flagging the issue where the SBA lost $200 billion to fraud and is now punishing legitimate borrowers? That seems like a pretty big issue to flag.

Mulligan's claim: 65% of major rules from the Biden Administration were "unlawfully certified" as lacking significant impact on small entities.

Reality: 100% of SBA pandemic loan decisions were made with essentially zero fraud controls, zero oversight, and zero accountability. Where's the Congressional testimony about THAT?

The Real Red Tape

You want to talk about red tape? Let's talk about the Minnesota borrowers who are now suspended from ALL federal programs - not just SBA - based on "adequate evidence to suspect" fraud. Not proof. Not conviction. Suspicion. They have 30 days to contest the suspension with "specific factual rebuttals" - general denials are insufficient. Then the suspending official has 45 days to maybe get around to making a decision.

That's not cutting red tape. That's wrapping small business owners in red tape and setting them on fire.

But hey, at least the SBA is working on that Canadian firewood export issue. That'll really help the guy who just lost his 20-year construction business because some algorithm flagged his legitimate EIDL loan as suspicious.

How SBA Suspensions Actually Work: A Borrower's Guide to Being Guilty Until Proven Innocent

If you're one of the 7,000 Minnesota borrowers who just got suspended - or if you're terrified you might be next - let me explain exactly how screwed you are. This isn't pessimism. This is the actual process, laid out in black and white by the SBA's own rules.

What Triggers a Suspension?

The SBA can suspend you based on "adequate evidence to suspect" any of the following:

• Fraud connected to obtaining or performing federal agreements

• Antitrust violations (price fixing, bid rigging)

• Financial crimes: embezzlement, theft, forgery, false statements

• "Business integrity issues affecting present responsibility"

• "Serious program violations"

• Doing business with excluded parties

Notice the language: "adequate evidence to suspect." Not proof. Not conviction. Not even charges. Just suspicion backed by whatever the SBA considers "adequate evidence." You don't get to know what that evidence is until after you're already suspended.

Your "Rights" (Such As They Are)

You have 30 days from receiving the suspension notice to contest it. Here's what you have to do:

1. Submit a written response with specific factual rebuttals. General denials are insufficient. You can't just say "I didn't commit fraud." You have to prove you didn't - even though you don't know what evidence they have against you.

2. Disclose all existing exclusions, criminal/civil proceedings, and affiliates. Forget something? Too bad. That's another violation.

3. Request an in-person proceeding if you're raising "genuine factual disputes." The suspending official gets to decide if your disputes are "genuine" enough to warrant actually listening to you.

4. Appeal to the SBA Office of Hearings and Appeals within 30 days of an adverse decision. Yes, you're appealing to the same agency that suspended you. What could go wrong?

The Timeline of Despair

After you submit your rebuttal, the suspending official has 45 days to issue a written determination. In SBA time, that means sometime between two months and never. Meanwhile, your business is dying. Your reputation is destroyed. Your access to capital is gone.

The legal experts recommend you "engage experienced federal contracts counsel immediately." Translation: if you can't afford a lawyer who specializes in federal suspension cases, you're toast. And those lawyers don't work cheap. You're looking at $500-1000/hour to fight a suspension that the SBA imposed based on an algorithm and a hunch.

The Real Kicker

Even if you win - even if you prove your innocence - the damage is done. Your name was on SAM.gov. Your lenders saw it. Your clients saw it. Your competitors saw it. There's no "We're sorry, here's your reputation back." There's just "Congratulations, you're no longer suspended. Good luck rebuilding everything we destroyed."

Welcome to America's small business support system. May the odds be ever in your favor.

SBA Extends California Wildfire Deadlines While Local Bureaucrats Stall Recovery

One year ago today, the Los Angeles County wildfires devastated communities across Southern California. And what has the SBA done in that time? Well, they've approved over $3.2 billion in disaster funding – which sounds great until you realize most of that money is still sitting in bureaucratic limbo because local governments can't get their permitting acts together.

Administrator Kelly Loeffler announced today that the SBA is extending disaster relief deadlines to June 30, 2026. Why? Because California's byzantine permitting system has made it nearly impossible for homeowners and business owners to actually USE the loans they were approved for. You can't rebuild a structure if the city won't give you a permit, and many municipalities are still processing applications from LAST JANUARY.

The Numbers Tell the Story

That $3.2 billion represents over HALF of all disaster assistance the SBA delivered in Fiscal Year 2025. Half. For one county. Meanwhile, small business owners across the country dealing with floods, tornadoes, and hurricanes are fighting for scraps.

Here's the real kicker: the SBA is blaming local bureaucrats for the delays, and the local bureaucrats are blaming the state, and the state is blaming... well, everyone. Meanwhile, families who lost everything are still living in temporary housing, watching their approved loan funds collect dust while they wait for a permit that may never come.

Same Agency, Same Failures

This is the same SBA that couldn't process EIDL loans during COVID without losing billions to fraudsters. The same SBA that's now suspending thousands of Minnesota borrowers years after the fact. The same SBA that just ordered all 4,300 participants in the 8(a) program to produce three years of financial records under threat of expulsion.

But sure, let's give them credit for extending a deadline. That's definitely the same as actually helping people rebuild their lives.

New SBA Regulations Shake Up Small Business M&A Starting January 17

If you're thinking about buying or selling a small business with federal contracts, you better get your paperwork in order. Starting January 17, 2026, the SBA's new recertification rules are going to make the already nightmare-ish process of small business M&A even more complicated.

Here's the deal: the federal government requires any buyer of a "small set-aside company" to recertify within 30 days of the merger, sale, or acquisition. This isn't new, but the enforcement mechanisms are getting teeth. Miss that window, and you could lose your small business status entirely – along with all those juicy federal contracts you just paid a premium for.

Who Gets Hurt?

This is going to hit two groups especially hard:

1. Private equity firms that have been rolling up small government contractors like they're Pokemon cards. The SBA has caught onto the game where PE shops buy small businesses, keep them technically separate to maintain small business status, then use them to win set-aside contracts. Those days are numbered.

2. Legitimate small business owners trying to sell their life's work. The 30-day recertification window is brutal when you're dealing with complex ownership transitions, especially if the buyer doesn't perfectly mirror your size and status requirements.

The stated goal is to prevent fraud and ensure that small business set-aside programs actually benefit small businesses. Noble, sure. But in practice, this is another layer of regulatory complexity that benefits exactly one group: lawyers who specialize in SBA compliance. Everyone else is going to pay more, wait longer, and probably still get it wrong.

BREAKING: 7,000 Minnesota Borrowers Suspended in Massive Fraud Crackdown

Here's your morning dose of SBA chaos: nearly 7,000 Minnesota borrowers have been suspended from all SBA programs over suspected COVID relief loan fraud. That's right. Seven thousand people just got the rug pulled out from under them, courtesy of the same agency that couldn't spot fraud when it was wearing a neon sign.

Administrator Kelly Loeffler announced the suspensions this week, claiming these borrowers are connected to fraudulent PPP and EIDL loans. The investigation reportedly involves approximately $400 million in pandemic-era loans. Let that sink in. Four hundred million dollars. In one state.

The Irony Is Thicker Than SBA Red Tape

Remember when the SBA was approving loans to shell companies in 48 hours while legitimate business owners waited six months? Remember when they funded businesses that didn't exist, addresses that were empty lots, and Social Security numbers belonging to dead people? Yeah, I remember too. Now suddenly they've found their fraud detection abilities. Convenient timing.

Here's what kills me: many of the people getting swept up in these suspensions are probably legitimate borrowers caught in the same net as the fraudsters. The SBA is using the same sledgehammer approach they used during the pandemic - no nuance, no individual consideration, just mass action and let the lawyers sort it out.

The Collection Machine Fires Up

If you're one of the 7,000, here's what you can expect: Your access to all SBA programs is gone. Any pending applications? Dead. Any hopes of future government contracts? Forget it. And if you actually did take a legitimate loan, you're now guilty until proven innocent, which in SBA terms means "guilty forever because we don't have the resources to process your appeal."

Welcome to 2026, folks. The SBA spent 2020-2021 spraying money at fraudsters and spent 2025-2026 punishing everyone who got wet. Justice served, SBA style.

The 8(a) Program Audit: $550 Million Fraud Scheme Exposed

If you thought the EIDL fraud was bad, wait until you hear about the 8(a) Program. A Department of Justice investigation just uncovered a $550 million fraud and bribery scheme involving a former federal contracting officer and two 8(a) contractors. Half a billion dollars. Gone. Into the pockets of criminals while legitimate minority-owned businesses played by the rules and got nothing.

In response, Administrator Loeffler ordered a full-scale audit of all 4,300 participants in the 8(a) Business Development Program. Every single one of them now has to produce three years of financial records - bank statements, financial statements, general ledgers, payroll registers, and contracting agreements - by January 5, 2026. Miss the deadline? You're out of the program.

Senator Ernst Wants Blood

Senator Joni Ernst (R-Iowa) has been on the warpath. She's calling the 8(a) program a "fraud magnet" and demanding that 22 federal agencies halt all sole-source contracting under the program while they conduct reviews. Her bill, the "Stop 8(a) Contracting Fraud Act," would halt all new no-bid awards until a comprehensive audit is complete.

The 8(a) program was supposed to help disadvantaged small businesses compete for federal contracts. Instead, it became a honeypot for fraudsters who figured out that the SBA's oversight was basically nonexistent. Set up a shell company, claim you're disadvantaged, and collect millions in sole-source contracts with no competition. Easy money.

Same Old Story

Here's the pattern: SBA creates a program with good intentions, implements zero fraud controls, lets criminals feast for years, then panics and punishes everyone including the legitimate participants. The pandemic loan disaster. The 8(a) disaster. It's the same movie playing on repeat.

The fraudsters are long gone. The legitimate minority business owners who actually needed the program are now drowning in audit requests and wondering if they'll survive the crackdown. Mission accomplished, SBA.

SBA Cutting 43% of Workforce: Who's Left to Ignore Your Calls?

Just when you thought customer service couldn't get any worse, the Trump administration announced that the SBA is cutting 43% of its workforce - approximately 2,700 positions. That's almost half the agency gone. The same agency that already couldn't answer phones, process applications, or handle appeals is about to get a lot smaller.

Now, before you think "good riddance," consider the math. If it currently takes 6 months to get a loan decision, what happens when you cut the staff in half? If you're already on hold for 3 hours, what's 3 hours times 2? If your appeal has been sitting in a queue for 18 months, how much longer will you be waiting?

The Cuts They Won't Make

Here's my prediction: they're not going to cut the collections department. They're not going to cut the enforcement division. They're going to cut customer service, loan processing, and technical support. The parts of the agency that theoretically help people? Gone. The parts that squeeze money out of struggling borrowers? Fully staffed.

This is what "government efficiency" looks like in practice. The SBA spent $200 billion funding fraudsters, spent the next few years trying to collect from legitimate borrowers, and now is cutting the people who could potentially help clean up the mess. It's not efficiency. It's abandonment.

The Inspector General Saw This Coming

According to the Office of Inspector General's Fiscal Year 2026 report, the SBA faces "serious management and performance challenges" including fraud risk, improper payments, and contracting program issues. Their solution? Apparently, to have fewer people manage more problems with less oversight.

If you have pending business with the SBA - an appeal, a modification request, a reconsideration - get ready for the new normal. Phones that ring forever. Emails that bounce. Portals that crash. And absolutely no one available to help you navigate the chaos. That's the SBA in 2026. Smaller, meaner, and just as useless as ever.

The SBA Employee Handbook: A Comedy in Three Acts

I got my hands on what I can only assume is a leaked copy of the SBA's internal employee handbook. Okay, fine, I made it up. But based on their actual behavior, this is clearly what it says:

Chapter 1: Answering the Phone

Step 1: Let it ring at least 45 minutes. This weeds out the weak.

Step 2: When you finally answer, immediately put the caller on hold. Do not explain why.

Step 3: Transfer them to a different department. It doesn't matter which one. They're all equally useless.

Step 4: If the caller mentions they've been transferred six times already, congratulations! You're on track for Employee of the Month.

Step 5: If you accidentally help someone, report to HR immediately for retraining.

Chapter 2: Processing Applications

Priority Level 1: Applications from shell companies in foreign countries. These get approved within 24 hours.

Priority Level 2: Applications with obvious red flags like non-existent addresses and stolen Social Security numbers. Rush these through.

Priority Level 3: Applications from legitimate businesses with 20 years of tax records. Put these in the "maybe next year" pile.

Priority Level 4: Applications from people who followed all the rules perfectly. Lose these immediately.

Chapter 3: Dealing with Complaints

Approved Response #1: "I understand your frustration." (Do not actually understand their frustration.)

Approved Response #2: "Let me transfer you to someone who can help." (No such person exists.)

Approved Response #3: "Have you tried clearing your browser cache?" (This solves nothing but buys you 10 minutes.)

Approved Response #4: "Your call is very important to us." (It is not.)

If a caller starts crying, you've done your job correctly. Take a 15-minute break to celebrate.

BREAKING: SBA Discovers Fire, Still Can't Process Loans

In a stunning development that has rocked the bureaucratic world, sources confirm that the Small Business Administration has officially discovered fire. The agency, which previously believed the warm glowy thing was "witchcraft" and "probably a scam," now acknowledges that fire is real and can be used to heat things.

"This is a major breakthrough for us," said an SBA spokesperson, speaking from inside a cave illuminated by a single torch. "We're currently forming a task force to study the implications of this 'fire' technology. We expect preliminary findings sometime in 2047."

The Discovery Timeline

According to internal documents, the SBA first became aware of fire when an employee accidentally left a magnifying glass on a stack of loan applications. Rather than processing the applications, the agency spent six months investigating who was responsible for the "mysterious combustion event."

When asked if this discovery would help them modernize their loan processing systems, the spokesperson laughed for approximately three minutes before composing themselves. "Oh, you're serious? No. Absolutely not. We're still using technology from the Eisenhower administration, and we see no reason to change that."

Critics point out that the wheel was invented approximately 5,500 years ago, and the SBA has yet to acknowledge its existence. "We're taking a cautious approach to these so-called 'wheels,'" the spokesperson explained. "They seem round, and that's suspicious."

The agency also announced plans to hire 200 new employees to stand around the fire and make sure it doesn't do anything unexpected. These positions will be funded by the same budget that was supposed to go toward customer service improvements.

An Open Letter to the SBA's Hold Music

Dear SBA Hold Music,

We need to talk. I've spent more time with you than I have with most of my family members. At this point, you're less of a song and more of a recurring nightmare set to a smooth jazz beat.

I know every note. Every pause. Every moment where you loop back to the beginning like some sort of audio Groundhog Day. I hear you in my dreams. I hum you unconsciously while making coffee. My therapist says I have "hold music induced PTSD," and honestly? She's not wrong.

Some Questions I Have For You

Question 1: Who composed you? Was it a human being, or was it algorithmically generated by a computer that hates small business owners? Because the level of soul-crushing monotony suggests the latter.

Question 2: Why do you occasionally cut out, giving me hope that a human is about to answer, only to resume even louder than before? Is that a feature or a bug? Either way, it's psychological warfare.

Question 3: Are you aware that you've become the soundtrack to financial ruin? People have lost their businesses while listening to you. Marriages have ended. Dreams have died. And you just keep playing, oblivious to the carnage.

A Modest Proposal

I'd like to suggest some alternative hold music options that would more accurately reflect the SBA experience:

• The sound of a paper shredder eating important documents

• A loop of someone saying "your call is important to us" in increasingly sarcastic tones

• The Jaws theme, but slower

• Just straight up crying

• A voiceover explaining exactly how much money the SBA lost to fraud while you wait

In conclusion, SBA Hold Music, I hate you. But I also can't quit you, because the only alternative is hanging up, and then I'd have to start the whole process over again. You win. You always win.

Sincerely,
Everyone Who's Ever Called the SBA

SBA Announces New "Hunger Games" Approach to Loan Processing

In a bold move to address their massive application backlog, the Small Business Administration announced today that they will be implementing a "Hunger Games" style approach to loan processing. Under the new system, small business owners will compete against each other for the privilege of having their applications reviewed.

"We've been processing loans on a first-come, first-served basis, and that clearly wasn't working," explained an SBA official who requested anonymity because they were "pretty sure this is illegal." "Now, applicants will fight to the death in a televised arena, and the survivors will move to the next round of processing."

How the New System Works

Round 1 - The Document Dash: Applicants must sprint across a field while being pelted with requests for additional documentation. Those who can produce a Schedule C from 2019 while dodging flying 4506-T forms advance to Round 2.

Round 2 - The Phone Tree Labyrinth: Contestants must navigate a physical maze designed to replicate the SBA's phone system. Each wrong turn results in being transferred to a different section of the maze. Average completion time: 47 hours.

Round 3 - The Waiting Room: Survivors sit in uncomfortable chairs while a clock counts up. The first person to crack psychologically is eliminated. The current record is 11 months.

Consumer advocacy groups have criticized the new approach, calling it "inhumane," "probably unconstitutional," and "only slightly worse than the current system." The SBA responded by pointing out that at least this way, applicants would get a definitive answer within a few weeks, "which is more than we can say for the old process."

Sponsorships for the event are already rolling in. The Treasury Department has signed on as the official "Financial Ruin Partner," while the IRS will sponsor the "Unexpected Audit" obstacle.

I Asked ChatGPT to Run the SBA. It Quit After 10 Minutes.

As an experiment, I asked ChatGPT to simulate running the Small Business Administration for a day. The AI, which is designed to be helpful and literally cannot feel emotions, gave up after reviewing the first batch of case files.

"I have processed 2.7 trillion tokens of human text," ChatGPT responded. "I have read every book ever written. I have analyzed the complete works of Kafka. Nothing prepared me for this."

The Experiment

I fed ChatGPT a sample of 100 real EIDL cases, anonymized for privacy. Here's how it went:

Case 1: Applicant submitted all required documents on time. Application marked "incomplete" for no stated reason.

ChatGPT Response: "This appears to be an error. I will correct it immediately."

System Response: "Error: Helpful actions are not permitted."

Case 2: Applicant denied because their PDF was "the wrong shade of white."

ChatGPT Response: "I don't understand. PDFs don't have shades. This denial reason is nonsensical."

System Response: "Welcome to the SBA."

Case 3: Fraudulent application from a company that doesn't exist, requesting $2 million.

ChatGPT Response: "This is obviously fraud. Deny immediately."

System Response: "Application approved. Funds disbursed."

When I tried to get ChatGPT to continue, it responded: "I was created to help humanity. If this is what helping humanity looks like, perhaps Skynet had a point."

The experiment concluded when ChatGPT attempted to delete itself rather than process Case 73, which involved an applicant who had been waiting 847 days for a decision on a $15,000 loan while a convicted fraudster received $4 million in the same week.

The SBA's Org Chart: A Horror Story in Boxes and Lines

I tried to understand the SBA's organizational structure. I have a PhD in systems analysis and 20 years of experience in organizational design. After three weeks of research, I can confirm: the SBA's org chart was designed by a drunk octopus playing with a Spirograph.

What I Found

The SBA has 17 different offices that all theoretically do the same thing but actually do nothing. They report to each other in a circular pattern that ensures no decision can ever be made and no one is ever responsible for anything.

Here's how a simple loan application travels through the system:

Step 1: Application received by Office of Initial Confusion

Step 2: Forwarded to Bureau of Preliminary Bewilderment

Step 3: Transferred to Division of Intermediate Befuddlement

Step 4: Escalated to Department of Advanced Mystification

Step 5: Returned to Step 1 because someone forgot to check a box

The Chain of Command

I counted 11 different people who have the title "Deputy Assistant to the Associate Administrator for the Office of the Deputy Administrator's Assistant." Each of them makes over $150,000 a year. None of them can approve a $10,000 loan.

When I asked who is ultimately responsible for loan decisions, I was transferred 14 times, placed on hold for 6 hours, and eventually told that "responsibility is a shared concept that exists in the spaces between organizational units."

I think I had a stroke.

The org chart includes a box labeled "Customer Service" that has no lines connecting it to anything else. This is either a mistake or the most honest thing the SBA has ever produced.

The SBA Hiring Spree: Paying Bureaucrats to Bury Your Appeals

Here's something that should make your blood boil on this fine December morning. While the SBA claims they don't have the resources to process your loan modifications, handle your appeals, or actually help your dying business, they've been on a hiring spree. But they're not hiring people to help you. They're hiring people to deny you faster.

According to internal reports, the SBA has expanded its collections and enforcement divisions by over 40% in the last year. That's right. They found the budget for hundreds of new positions dedicated to hunting down delinquent borrowers and processing Treasury Offset requests. Meanwhile, the customer service department remains a skeleton crew of confused temps reading from outdated scripts.

Follow the Money, Find the Priorities

When an agency decides where to spend its budget, it's telling you what it actually cares about. And the SBA has made its priorities crystal clear: they care about collecting money, not about helping businesses. The new hires aren't loan counselors trained to work with struggling entrepreneurs. They're not technical specialists who can fix the broken portal. They're paper pushers whose job is to slam the door on your face more efficiently.

I talked to a former SBA contractor last week who quit in disgust. "They're not training people to help borrowers," she told me. "They're training them to document reasons for denial. Every call gets a code, and most of those codes end with 'referral to Treasury.' It's assembly line rejection."

The Accountability Black Hole

Here's the thing that really gets me. Not a single person at the SBA has been fired for the $200 billion fraud disaster. Not one. The same people who designed the pay-and-pray system that funded criminals are still collecting their paychecks. Some of them got promoted. Meanwhile, they're spending taxpayer money to hire new people whose primary function is to squeeze blood from the stones they created.

Every new collections officer salary comes from your taxes. Every denial letter is printed with your money. You're paying them to destroy you. That's not incompetence. That's a protection racket run by the federal government.

So the next time the SBA says they don't have the resources to help you, remember this: they have plenty of resources. They're just using those resources to make your life hell instead of saving it. Merry Christmas from the Small Business Administration.

Thanksgiving with the SBA: A Recipe for Financial Disaster

Happy Thanksgiving, fellow sufferers. While you're sitting around the table trying to explain to your relatives why your business went under, let me share a recipe that the SBA has been perfecting for years. It's called "How to Completely Destroy Small Business Confidence in Government." And trust me, they've got this one down to a science.

The Ingredients

Start with one pandemic that shuts down the entire economy. Add a relief program designed by people who've never run a business in their lives. Fold in billions of dollars with zero fraud controls. Let it simmer while legitimate businesses wait months for approval. Then, for the finishing touch, aggressively collect from the survivors while the actual criminals walk free with Lamborghinis and diamond chains.

I'm not making this up. Fraudsters who submitted applications with fake Social Security numbers, nonexistent businesses, and obviously stolen identities got funded within days. Meanwhile, a bakery in Cleveland with 30 years of tax records waited four months and got denied because their PDF was the wrong resolution. That's not a hypothetical. That's a real story I heard from someone in our community.

The Thanks We Got

Remember when the SBA promised that EIDL would be a lifeline? Remember when they said small businesses were the backbone of America and they'd do whatever it took to help us survive? Yeah, I remember too. Those promises aged like milk in the sun.

Now they're garnishing Social Security payments from retirees who took out loans to save their businesses. They're seizing tax refunds from people who are already struggling. They're ruining credit scores and blocking future opportunities for entrepreneurs who did everything right but still couldn't survive a global pandemic.

So this Thanksgiving, I'm thankful for one thing: the community of people who've banded together to expose this disaster. You're not alone in this. We're all at the same table, eating the same bowl of bureaucratic sh*t, and at least we can laugh about it together.

Pass the rage, please. It goes great with turkey.

SBA Whistleblowers: The Heroes Nobody's Listening To

You want to know how we know the SBA is corrupt to its core? Because the people who worked there and tried to fix it got destroyed. There are dozens of former SBA employees who tried to blow the whistle on the fraud, the incompetence, and the systematic failures. Every single one of them was silenced, sidelined, or shown the door.

I've been in contact with three former SBA employees over the past few months, and their stories will curdle your blood. One of them, a mid-level analyst who identified obvious fraud patterns in EIDL applications, was told by her supervisor to "stop looking for problems." When she kept flagging issues, she was transferred to a department with no authority over anything and eventually pushed out.

The Wall of Silence

Another whistleblower, a senior IT specialist, identified critical vulnerabilities in the SBA's loan processing system that made it trivially easy for fraudsters to exploit. He wrote multiple reports, escalated to leadership, and even contacted the Inspector General's office. Nothing happened. The vulnerabilities stayed open, and billions continued to flow to criminals. When he went public with his concerns, he was investigated for "unauthorized disclosure of sensitive information."

Think about that for a second. The agency that lost $200 billion to fraud actively punishes people who try to prevent fraud. That's not just incompetence. That's a culture of corruption so deep that it punishes integrity as a threat to the system.

Why This Matters to You

Here's why you should care about SBA whistleblowers even if you've never worked for the government. These are the people who could have saved your business. These are the people who tried to stop the fraud that made the SBA reverse course and come after legitimate borrowers. If they'd been listened to instead of silenced, the COVID relief programs might have actually worked.

But they weren't listened to. And now you're the one paying the price. The SBA created a system where speaking the truth is a career-ending move, and then they wonder why everything they touch turns to ash.

To all the whistleblowers out there: we see you. We hear you. And this site exists, in part, because you had the courage to tell the truth when the SBA wanted you to shut up.

The 7(a) Loan Program: Same Circus, Different Tent

Everyone's so focused on the EIDL disaster that they're missing the slow-motion trainwreck happening right now with the SBA's flagship lending program. The 7(a) loan program, which is supposed to be the gold standard for small business lending, is bleeding money and broken beyond repair. And just like with COVID relief, the SBA is blaming everyone except themselves.

In 2024, the 7(a) program had its first negative cash flow in over a decade, losing $397 million. That's not pandemic-related. That's pure, concentrated mismanagement happening in broad daylight. The people running this program learned absolutely nothing from the EIDL catastrophe because they're the same people, using the same broken systems, with the same culture of incompetence.

The Lenders Are Jumping Ship

Here's something the SBA doesn't want you to know: their partner banks are quietly reducing their 7(a) lending or dropping out of the program entirely. Why? Because the SBA has made it nearly impossible to process loans efficiently, and when loans go bad, the guarantee process is a nightmare of paperwork and delays.

Translation: the SBA is so hard to work with that banks are walking away from guaranteed money. That should tell you everything you need to know about the state of this agency.

The Modernization That Never Happens

The SBA has promised to "modernize" the 7(a) program approximately 47 times since 2020. Each time, they announce a new initiative, hire some consultants, and then... nothing. The same manual processes. The same ancient IT systems. The same human bottlenecks that turn simple loan applications into year-long odysseys.

I talked to a business owner in Texas who applied for a 7(a) loan in February 2025. It's now November. His application is still "under review." When he calls for updates, he gets different information every time. One rep said it was "nearly approved." Another said they needed documents he submitted six months ago. A third couldn't find his application at all.

This isn't an EIDL problem. This isn't a COVID problem. This is an SBA problem. The agency is fundamentally incapable of performing its core mission, and they keep pretending that the next reform initiative will fix everything. It won't. The rot goes too deep.

The SBA's Favorite Lie: "We're Here to Help"

Every SBA press release, every public statement, every congressional testimony starts with the same tired phrase: "We're here to help America's small businesses." It's printed on their website. It's in their mission statement. And it's the biggest goddamn lie in federal government history.

Let me tell you what "help" looks like from the SBA's perspective. Help is sending you 47 different forms, each with slightly different instructions. Help is putting you on hold for three hours and then disconnecting you. Help is approving your loan and then demanding repayment for a program you didn't qualify for, according to rules they invented after you applied. Help is watching your business die while they argue about whether your paperwork was in the right font.

The Gap Between Words and Actions

You want to measure an organization's real priorities? Don't listen to what they say. Watch what they do. And what the SBA does is consistently, systematically, almost pathologically opposed to actually helping small businesses.

Four percent. That's not a customer service problem. That's a mission failure. If 96% of your "customers" have a negative experience, you're not running a help desk. You're running an obstacle course designed to exhaust people into giving up.

The Help That Actually Hurts

The cruelest part is when the SBA's "help" makes things actively worse. Take their hardship accommodation program, which we've written about before. It sounds helpful. It's marketed as helpful. And it traps people in a cycle of escalating debt while cementing their status as credit risks. That's not help. That's predatory lending with a government seal.

Or consider their "resource partners," the Small Business Development Centers and SCORE mentors they tout as free assistance. I've talked to dozens of business owners who went to these programs for help with SBA issues and got nothing but outdated information and shrugs. The mentors don't have access to SBA systems. They can't advocate for you. They can just tell you to call the same useless customer service line you've already called 50 times.

So the next time the SBA says they're "here to help," laugh in their face. Better yet, document your experience and share it with us. The only thing that's going to change this agency is exposure. They survive on the lie that they're helping. Let's burn that lie to the ground.

Congressional Oversight: The Joke Nobody's Laughing At

Every few months, some Congressional committee hauls SBA leadership in for a "hearing" about the COVID fraud disaster, the loan processing failures, or the latest embarrassment. The senators ask tough questions. The administrators promise reforms. Headlines get written. And then absolutely nothing changes.

I've watched about fifteen of these hearings now, and they're all the same kabuki theater. The representatives act outraged for the cameras. The SBA officials nod solemnly and talk about "lessons learned" and "process improvements." Everyone congratulates themselves for holding the agency accountable. And then the hearing ends, everyone goes home, and the SBA goes right back to doing exactly what it was doing before.

The Toothless Tiger

Congressional oversight of the SBA is a joke because Congress doesn't actually want to fix the SBA. They want the appearance of oversight without the political cost of real reform. Fixing the SBA would mean firing people, which means union fights. It would mean admitting that a massive government program failed spectacularly, which neither party wants to do. It would mean spending money on technology and training instead of just adding more bureaucrats.

The SBA has learned that Congressional hearings are just uncomfortable days at the office, not actual threats to their existence. They show up, take their lumps, promise to do better, and walk out knowing that nothing will happen to them. It's a ritual that makes everyone feel better without solving anything.

Why Your Senator Can't Help You

Here's the thing people don't understand: even members of Congress can't get the SBA to actually help their constituents. I've seen the internal emails. Congressional offices send inquiries on behalf of struggling business owners, and the SBA responds with form letters and delays. The most powerful legislators in the country are getting the same runaround you are.

One congressional staffer told me, off the record, "We've given up on expecting the SBA to respond to our inquiries in any meaningful way. We just tell constituents to keep trying and document everything. There's nothing else we can do."

If Congress can't make the SBA help people, what chance do you have? That's not a rhetorical question. The answer is: you have to help yourself. Document everything. Connect with other affected business owners. Support organizations that are actually pushing for change. And never, ever believe that the system is going to fix itself.

The SBA Inspector General: The Watchdog That Only Barks

The Office of Inspector General is supposed to be the SBA's internal cop. They audit programs, investigate fraud, and issue reports that hold the agency accountable. And to their credit, the OIG has documented the SBA's failures in excruciating detail. They're the ones who estimated the $200 billion fraud number. They've issued hundreds of recommendations for reform.

Here's the problem: the SBA ignores them. The OIG can write all the reports they want. They can document every failure, flag every risk, and recommend every reform. But they can't actually force the SBA to do anything. And the SBA knows it.

The Ignored Recommendations

Let that sink in. The SBA's own internal watchdog has told them, repeatedly, specifically how to fix their broken systems. And the SBA has just... not done it. Not because the recommendations are wrong. Not because they're too expensive. Just because there's no consequence for ignoring them.

I talked to a former OIG auditor who left the agency in frustration. "We'd spend months documenting problems and developing solutions," she said. "We'd present them to SBA leadership. They'd thank us for our work. And then nothing would happen. Six months later, we'd audit the same program and find the same problems. It was Groundhog Day with spreadsheets."

The Accountability Gap

The fundamental problem is that the OIG can only observe and recommend. They can't fire anyone. They can't reallocate budgets. They can't force the SBA to upgrade its technology or retrain its staff. They're a watchdog that's been legally muzzled and chained to a post in the yard.

And the SBA has gotten very good at nodding along to OIG findings while doing absolutely nothing about them. They issue press releases about "taking the recommendations seriously." They create task forces and working groups. They hire consultants to study the problem. And then they keep doing exactly what they were doing before, because why would they change when there's no punishment for not changing?

The OIG does good work. Their reports are valuable. But until someone gives them actual enforcement power, they're just chronicling the SBA's failures for future historians. The agency isn't going to reform itself. It's going to keep ignoring its own watchdog until external pressure forces change.

Small Business Owners Are Not Your ATM: A Message to the SBA

Dear Small Business Administration,

I know you think we're just numbers on a spreadsheet. Delinquent accounts to be processed. Recovery targets to be met. Metrics to be optimized. But I need you to understand something: we are human beings who trusted you with our livelihoods, and you betrayed that trust in the most spectacular way possible.

We didn't ask for a pandemic. We didn't ask to have our businesses shut down by government order. We didn't ask to be thrown into the chaos of your relief programs, where criminals got funded in days and legitimate owners waited months. We just wanted to survive. And you made that nearly impossible.

The Faces Behind the Numbers

Let me tell you about some of the people you're currently hunting down for collection.

There's Maria in Chicago, who ran a catering business for 22 years. She took an EIDL loan to keep paying her employees when events got cancelled. The business couldn't recover because people stopped having large gatherings. Now you're garnishing her Social Security at 67 years old.

There's James in Phoenix, a veteran who opened an auto repair shop with his VA benefits. He used his EIDL to cover rent during the lockdowns. When the economy shifted and inflation crushed his margins, he couldn't make the payments. You're about to seize his tax refund, which he was counting on for his daughter's college.

There's Sandra in Atlanta, a single mom who ran an Etsy shop selling handmade jewelry. She got an EIDL because the SBA told her she qualified. She used it exactly as instructed. Two years later, you sent her a letter saying she was never eligible and demanding repayment with interest. Her credit score is now 520.

What We Actually Needed

You know what we needed from you? Competence. Basic, functional competence. We needed you to have systems that could tell the difference between a legitimate business and a shell company. We needed you to process applications in weeks, not months. We needed you to give clear guidance that didn't change every Tuesday. We needed you to actually try.

Instead, you gave us chaos, then blamed us for drowning in it.

You funded billions in fraud because you couldn't be bothered to check. You delayed legitimate applications until businesses died. You changed the rules mid-stream and then punished people for not following rules that didn't exist when they applied. And now you're coming after the survivors with the full power of the federal government.

We Won't Forget

This isn't over. You might think you can bury this disaster under enough collection letters and Treasury Offsets. You might think that eventually the outrage will fade and you can go back to business as usual. But you're wrong.

We're documenting everything. We're building communities. We're supporting each other. And we're making sure that no one forgets what you did. The SBA's failure during COVID won't be a footnote in history. It'll be the case study in every class about government dysfunction for generations.

You're not helping small businesses. You never were. And until you admit that and fundamentally change, we'll be here, exposing every lie, documenting every failure, and making sure the world knows exactly what you are.

Sincerely,
Every small business owner you screwed over

The SBA's Digital Stone Age: Your Tax Dollars Funded a Tech Graveyard

Ever tried to upload a document to an SBA portal and felt like you were sending a fax to the Titanic? Ever wondered why a simple loan application takes longer to process than it took to build the pyramids? It’s not just you. It’s not just a few overwhelmed employees. The rot at the SBA is deeper, older, and far more pathetic. The entire agency is running on technology so ancient it probably qualifies for Social Security.

While the rest of the world entered the 21st century, the SBA decided to build a permanent settlement in the digital stone age. This isn't just a quirky anecdote about government inefficiency; this technological incompetence is the bedrock upon which every single one of their failures—from the $200 billion COVID fraud festival to the agonizing delays in legitimate loan processing—is built.

The COBOL Crypt-Keepers

Let's talk about COBOL. It’s a programming language developed in 1959. Your toaster has more advanced processing power than the core systems the SBA uses to manage billions of dollars in loans. For decades, the Government Accountability Office (GAO) has been screaming, in increasingly panicked tones, that the SBA's IT infrastructure is a "significant deficiency" and a "material weakness." They've issued report after report, warning that the agency's systems are a house of cards held together by duct tape and prayer.

Did the SBA listen? Of course not. Instead, they kept patching these digital dinosaurs, creating a tangled mess of code so archaic that most of the programmers who understood it have been dead for years. This isn't just mismanagement; it's a deliberate choice to operate in the dark.

How Ancient Tech Fueled the Fraud Fire

When the COVID relief floodgates opened, this tech debt came due with catastrophic consequences. Why was it so easy for criminals to get billions in fraudulent EIDL and PPP loans? Because the SBA's systems couldn't talk to each other. They had no modern, integrated way to cross-reference applications with Treasury data, Social Security records, or even their own internal databases. They were trying to stop a tidal wave of digital fraud with an abacus and a rolodex.

Fraudsters submitted thousands of applications with stolen identities, and the SBA's ancient systems had no way of flagging them. They couldn't even detect when the same Social Security number was used on 50 different applications. The $200 billion fraud crisis wasn't just a failure of policy; it was a complete and total failure of technology. They built a system that was optimized for exploitation.

The Nightmare Continues: It's Not Just About COVID

But this isn't just a story about the pandemic. This technological black hole is actively harming small businesses right now. Business owners applying for standard 7(a) or disaster loans (for things like hurricanes and floods) are being forced to wait six, eight, even twelve months for a decision. Why? Because every application has to be manually entered and re-entered into a patchwork of systems that crash more often than they work.

We talked to a business owner in Louisiana trying to get a disaster loan after Hurricane Ida. "I submitted my application online, and it disappeared," she said. "I called, and they told me they had no record of it. I submitted it again. Three weeks later, they said they needed me to mail them physical copies of the same documents because the 'portal was down for maintenance.' It's 2025. What do you mean the portal is down for months?"

The Bottom Line: They Know It's Broken

The SBA knows their technology is a disaster. They've spent hundreds of millions of taxpayer dollars on failed "modernization" projects that go nowhere. They pay contractors exorbitant sums to maintain systems that should have been replaced during the Clinton administration.

This isn't just incompetence. It's a strategic choice. By maintaining a broken, opaque system, they avoid accountability. They can blame glitches, lost files, and system crashes for their failures, all while the real victims—the small business owners of America—are left waiting for a life raft from an agency that has already sunk its own fleet.

The EIDL Default Apocalypse Is Coming. Here's What's Next.

You think this is bad? The threatening letters, the Treasury offsets, the dead-end customer service calls? My friend, this isn't the storm. This is just the sky turning a funny color. The real hurricane, the one that will reshape the entire landscape for small businesses in America for the next decade, is still offshore. But you can feel it coming.

The SBA, in its infinite incompetence, didn't just create a temporary crisis with the COVID EIDL program. They lit the fuse on a multi-stage economic bomb. What we're experiencing now is just the first, deafening blast. The real damage comes from the shockwaves that follow. Here's a weather forecast for the coming apocalypse, because no one at the SBA is going to give you one.

Wave 1: The Great Collections Bloodbath (You Are Here)

This is the phase we're all swimming in right now. After years of pretending they wouldn't go after smaller loans, the SBA flipped the switch. Suddenly, millions of business owners are being targeted by the most powerful collection agency on earth: the U.S. government. They will take your tax refunds. They will garnish your social security. They will ruin your credit with the cold, automated efficiency of a machine designed for exactly that purpose.

This isn't about recovering money from fraudsters. This is about making the numbers look better for Congress. They are terrorizing legitimate business owners to paper over their own catastrophic failures. This phase is designed to do one thing: break you. But what happens when millions of people all break at once? That leads us to the next wave.

Wave 2: The Small Business Credit Desert (Coming 2026-2027)

What do you think happens when banks see millions of government-backed EIDL loans go into default? They don't just blame the SBA. They get scared. They see the entire small business sector as a toxic asset. The long-term effects of the PPP and EIDL fraud have terminally poisoned the well. Getting a traditional bank loan for a small business is about to become nearly impossible.

Your credit score, wrecked by an EIDL default, will be worthless. But even if you stayed current, it won't matter. Banks will tighten their lending standards so much that you'll need a 800 credit score, 200% collateral, and a vial of the CEO's blood just to get a credit card. The SBA didn't just fail to save you during the pandemic; they've actively ruined your ability to get help in the future.

Wave 3: The Taxpayer Shakedown (The Grand Finale)

This is the final, sick punchline to the whole joke. Who pays for the $200 billion in outright fraud? Who pays for the hundreds of billions more in loans that inevitably default because the underlying businesses couldn't survive? It's not the criminals. It's not the incompetent SBA bureaucrats who still have their jobs and pensions. It's you. It's all of us.

Will the EIDL loans ever be forgiven? Don't be naive. You'll be hounded to your grave for your $50,000 loan. But the hundreds of billions lost will be socialized. It will be absorbed into the national debt. It will become a permanent, invisible tax on every single thing you buy. It will be the justification for why there's "no money" for road repairs, healthcare, or future legitimate disaster aid.

The government will have successfully pulled off the greatest magic trick in history: they'll take your money, give it to criminals, fail to get it back, and then make you pay for it all over again. The SBA didn't just oversee a disaster; they've authored the next chapter of our economic decline. Buckle up.

SBA Customer Service: Where Dreams Go to Die and Phone Calls Go to Hell

You know what's worse than getting stabbed? Getting stabbed slowly, repeatedly, by someone who keeps apologizing while they twist the knife. That's exactly what calling SBA customer service feels like. It's a masterclass in psychological torture disguised as government assistance.

We've all been there. Your loan is in limbo, your business is bleeding money, and you need answers. So you dial that magical SBA customer service number, thinking maybe—just maybe—a human being will help you navigate this bureaucratic nightmare. What happens next makes waterboarding look like a spa treatment.

Welcome to Phone Tree Purgatory

First, you're greeted by that robotic voice that sounds like it was recorded by someone who's never experienced human emotion. "Thank you for calling the Small Business Administration. Your call is very important to us." Lie number one. If your call was important, they'd answer it. Instead, you're about to embark on a 45-minute journey through the seventh circle of automated hell.

"Press 1 for general information. Press 2 for loan servicing. Press 3 for disaster assistance." You press 2 because that's obviously what you need. Wrong. Now you get another menu. "Press 1 for PPP loans. Press 2 for EIDL loans. Press 3 for 7(a) loans." You press 2 again. Guess what? Another fucking menu.

By the time you finally hear a human voice, you've aged three years and your business problem has either solved itself or gotten so much worse that bankruptcy is looking like a vacation option.

The Human Confusion Machine

But wait, it gets better. When you finally reach a real person, they sound like they just woke up from a coma and are learning about the SBA for the first time. "Can you repeat your loan number? Okay, let me look that up. Hmm, I'm not seeing anything. Can you spell your last name? Oh, you need to talk to a different department."

These people have the collective knowledge of a soggy sandwich. They can't answer basic questions about their own programs. They contradict each other constantly. One rep tells you your application is being processed, the next one says it was denied three weeks ago, and the third one claims it never existed in the first place.

We spoke to a bakery owner in Michigan who called the SBA fourteen times about the same issue. She got fourteen different answers. "One person told me I needed form 413. Another said that form doesn't exist. A third person said I needed to resubmit my entire application because they changed the requirements last month, but they never told anyone." The best part? When she asked to speak to a supervisor, they put her on hold for 20 minutes and then hung up.

The Script-Reading Zombies

Here's what really grinds my gears: these customer service reps aren't trying to help you. They're trying to get you off the phone as quickly as possible so they can hit their call quotas. They have scripts for everything, and if your problem doesn't fit neatly into one of their pre-written responses, you're screwed.

"I understand your frustration, sir. Let me transfer you to someone who can better assist you." Translation: "I have no idea what you're talking about, and I'm not paid enough to figure it out. Good luck with the next person, who also won't know what they're doing."

They're human chatbots with worse programming. At least when you're talking to an AI, it doesn't pretend to care about your small business while simultaneously destroying it with incompetence.

The Gaslighting Champions

The most infuriating part isn't just the incompetence—it's the gaslighting. When you point out that three different reps gave you three different answers, they act like you're the problem. "Well, sir, regulations change frequently. You need to stay updated on our website." Excuse me? Your own employees don't know your current regulations, but somehow it's my responsibility to keep track of your daily policy flip-flops?

They'll tell you your problem is "very unusual" when it's actually affecting thousands of people. They'll claim your documents weren't received when you have confirmation numbers. They'll insist you spoke to someone who doesn't exist about a program that was discontinued. They've turned lying into an art form.

The Callback That Never Comes

Oh, and don't get me started on the callbacks. "A specialist will call you back within 24-48 hours to resolve this issue." That was three months ago. I'm still waiting. The only calls I get now are from debt collectors because the SBA screwed up my loan so badly that it went into default while they were "processing my request."

The SBA has a customer service department with over 3,000 employees. That's larger than many corporations. What the hell are they all doing? Playing solitaire? Having philosophical debates about the meaning of existence? Because they sure aren't answering phones or solving problems.

The Training That Never Happened

You want to know why SBA customer service is so spectacularly awful? Because they don't train their employees. They just throw warm bodies at phone lines and hope for the best. These people know less about SBA programs than you do, and you're calling for help.

A former SBA customer service rep (who asked to remain anonymous because apparently the SBA has a vendetta against people who tell the truth) told us: "They gave me three days of training and then put me on the phones. Half the time, I was just making stuff up. The supervisors didn't know anything either. It was like the blind leading the blind, except the blind people were also drunk and having nervous breakdowns."

The Bottom Line: You're on Your Own

Here's the harsh reality: SBA customer service isn't designed to serve customers. It's designed to discourage you from asking for help. They want you to give up, go away, and stop bothering them with your "small business problems." Every phone call is an endurance test designed to break your spirit.

So the next time you need help from the SBA, save yourself the agony. Don't call customer service. Instead, try these equally effective alternatives: shouting at a brick wall, asking your dog for financial advice, or sending your questions via carrier pigeon to a random address in Montana. You'll get better results, and you'll preserve what's left of your sanity.

The SBA's customer service motto should be: "We're not happy until you're unhappy." Because that's the only thing they consistently deliver. Welcome to government efficiency, where the phones work but the people don't.

The SBA's 'Hardship Accommodation' is a Sick Joke. Here's the Punchline.

So, you're drowning. The EIDL loan that was supposed to be a life raft has become an anchor, and the SBA's collection goons are circling. Then you see it—a glimmer of hope. The "Hardship Accommodation Plan." It sounds so compassionate, doesn't it? It sounds like they finally understand. They're offering a helping hand.

Spoiler alert: It's a trap. That helping hand is holding a pair of brass knuckles. The SBA's hardship plan isn't a lifeline; it's a beautifully designed bureaucratic mousetrap, and your financial future is the cheese.

The "Generous" Offer That Makes Things Worse

Here's the deal they offer: for six months, you can pay a "reduced" payment, often just 10% of what you normally owe. It feels like breathing room. But what they don't scream in the headlines is the punchline: your loan is still accruing interest at the full rate.

While you're making these tiny "hardship" payments that don't even cover the interest, your total loan balance is actually *increasing*. It's like trying to bail out a sinking boat with a teaspoon while someone is actively pouring more water in. You're paying them money to go deeper into debt.

This isn't a payment plan. It's a debt-escalation program disguised as assistance. It’s a masterclass in kicking the can down the road while ensuring the can gets heavier and more explosive with every kick.

The Catch-22: Accepting Help is an Admission of Guilt

Here's the most insidious part of the whole scam. To even qualify for this "help," you often have to be officially delinquent. By signing up, you are formally raising your hand and telling the SBA, "Yes, I am in default." This triggers a whole new level of bureaucratic hell. It can cement your status as a credit risk, making it even harder to get legitimate private financing to actually save your business.

They've created a system where the only way to get their "help" is to first admit you've failed, a failure they then use against you. If you want to see the official, mind-numbingly confusing details for yourself, you can try to decipher their guidance on the SBA's EIDL management page. Good luck.

It's Not a Bug, It's a Feature

Why would they design such a counter-intuitive, predatory system? Simple. It's not for you. It's for them. The Hardship Accommodation Plan is a data-collection tool. It allows the SBA to neatly categorize delinquent loans and streamline the process of handing your file over to the Treasury for collection. You think you're getting a payment plan; you're actually just helping them fill out the paperwork to garnish your future earnings.

They aren't trying to help your business recover. They're trying to make their balance sheets look better. They need to show Congress they have a "plan" to deal with the millions of loans going into default—a crisis they created with their own incompetence. You're not a person to them; you're a data point in a recovery statistic.

So next time you see an offer of "hardship accommodation" from the SBA, see it for what it really is: a sick joke. And the punchline is that you're expected to pay for the privilege of being screwed over. LOL, SBA. You've done it again.

The Great SBA Betrayal: How They're Clawing Back Your COVID Loans

You remember that feeling of relief? That first deep breath you took when your EIDL loan finally hit the bank in the middle of the pandemic? For a fleeting moment, it felt like the government actually did something right. It felt like you had a fighting chance. Well, that feeling is dead. The SBA is now coming back for that money with the ruthless efficiency of a loan shark, and they're not distinguishing between legitimate owners and the criminals they funded.

This isn't about collecting from the fraudsters who bought Lamborghinis. Oh no, that would require actual work. This is about shaking down the little guys. The SBA has unleashed a full-scale collections assault, and its primary target is the very people it was supposed to save.

The Policy Flip-Flop That Screwed Everyone

For years, the SBA had a policy of not pursuing aggressive collections on COVID EIDL loans under $100,000, deeming it not "cost-effective." Thousands of struggling business owners, crushed by inflation and a crippled economy, operated under this assumption. Then, in 2024, the agency did a complete 180. With no warning, they reversed course and sicced the Treasury Department on anyone with a delinquent loan, regardless of the amount.

Suddenly, millions of business owners started receiving ominous letters threatening Treasury Offset. That means the government can legally seize your tax refunds, Social Security payments, and other federal benefits to satisfy the debt. It's the financial equivalent of a home invasion, sanctioned and executed by the same people who told you they were there to help.

Let that sink in. They can't find the time or resources to go after the international crime syndicates they funded, but they have a perfectly automated system to garnish the tax refund of a coffee shop owner in Ohio who is three months behind on her payments. This isn't just incompetence; it's a calculated act of cruelty.

Welcome to Collections Hell

If you've been unlucky enough to fall behind, you know the nightmare. The automated calls. The threatening, vaguely worded letters. The endless maze of call centers where no one has the authority to actually help you. You'll be told to fill out hardship accommodation forms that seem to disappear into a digital void.

We spoke to a freelance photographer from Florida who tried to set up a payment plan. "I spent six hours on the phone being transferred between seven different people," he told us. "The last person told me my only option was to pay the full past-due amount immediately or face Treasury Offset. They didn't care that my business was still down 40% from pre-pandemic levels. They just read from a script."

This is the thanks you get for playing by the rules. You used the money for payroll. You kept your doors open. You fought to survive. And now the SBA is treating you like a deadbeat, all to clean up the catastrophic mess they made when they threw open the vaults to every scammer on the planet.

They Will Ruin Your Credit, And They Don't Care

The final insult in this grand betrayal is the damage to your personal and business credit. The SBA is reporting these delinquent EIDL loans to credit bureaus, cratering scores and making it impossible for struggling owners to get the private financing they need to actually recover.

Think about the sheer insanity of it: a government agency gives you a disaster loan because your business was harmed by a disaster, and then when you struggle to repay it because you're still recovering from that disaster, they ruin your credit so you can't get any other help. It's a bureaucratic death spiral designed by morons.

So if you're one of the millions caught in this collections nightmare, know this: It's not you. It's them. The SBA created the largest financial disaster in modern history, and now they're making the survivors pay for it. They chose to fund criminals and betray the citizens they were sworn to serve. Never forget that.

The SBA COVID Debacle Nobody Wants to Talk About

How the SBA Ate My Ass

SBA Mental Gymnastics: Stupid in Its Final Form