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WATCH: Federal officials testify on fraud prevention in small business loan programs

Officials from the Office of the Inspector General and the U.S. Government Accountability Office testified Oct. 1 about efforts to prevent fraud within federal programs set up to support small businesses affected by the novel coronavirus pandemic.

Watch the hearing live in the video player above.

Hannibal “Mike” Ware, the Small Business Administration’s inspector general, testified alongside William Shear, director of Financial Markets and Community Investment in the U.S. Government Accountability Office.

In July the OIG released a report detailing concerns about potential fraud within the Economic Injury Disaster Loan Program, which was established by the CARES act to provide advance payments of up to $10,000 to small businesses that would not need to be repaid. The report found that the Small Business Administration had approved more than $250 million in economic injury disaster loans and advance grants to potentially ineligible businesses.

The hearing addressed these and other concerns outlined in the OIG report, including communication between lending institutions and the SBA, duplicate loans, and social media fraud schemes.

It also addressed GAO report that detailed potential issues with the SBA’s Payment Protection Program, including demographic information gaps, data reliability issues and uncertainties in the loan forgiveness process.

The PBS NewsHour will update this story as it develops.

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