The Small Business Administration may have inadvertently sent over $1 billion in COVID-19 relief to individuals in foreign countries, a government watchdog said in a Monday report.

SBA handed struggling small businesses and nonprofits up to $2 million in loans each through the COVID-19 Economic Injury Disaster Loans program as well as grants and advances. But the agency did not properly detect certain foreign IP address applicants, including those in “high risk” countries and may have given them up to $1.3 billion in funding, according to a SBA inspector general report.

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Some Americans and aliens who live in foreign countries may have qualified for Economic Injury Disaster Loans relief if they “meet certain eligibility requirements,” the report said, not explaining what those requirements were. The risk of fraud in the program was elevated “because of the history of fraud originating from transnational crime organizations that have stolen funds from U.S programs in the past,” said the report.

“The federal government’s response to COVID was panicked and not thought out,” E.J. Antoni, an economics fellow at The Heritage Foundation’s Center for Data Analysis, told the Daily Caller News Foundation. “The careless, shotgun approach to disbursing unneeded aid was an invitation for fraud, both at home and abroad.”

The Economic Injury Disaster Loans program was launched during the Trump administration and was first authorized by the passage of the Coronavirus Preparedness and Response Supplemental Appropriations Act in March 2020, the report says. It was reauthorized in two other coronavirus relief packages, including the American Rescue Plan signed by President Joe Biden, the report says.

SBA hired a contractor that processed relief applications and made recommendations to SBA loan officers or teams on whether they should approve them, the report says. The agency stopped accepting COVID-19 Economic Injury Disaster Loans applications on Jan. 1, 2022, and the program’s portal closed in May, the report says.

The system did not flag over 41,600 applications from six “high risk” foreign IP addresses despite “four layers of controls” to do so, according to the report. In turn, the agency between March 20, 2020, and Nov. 12, 2021, disbursed these applicants $1.3 billion, the report says.

“Under the previous administration, a decision not to require a static IP address for EIDL applicants was made,” a spokesman for SBA told the Daily Caller News Foundation. “Under the leadership of Administrator Guzman, this administration immediately set to work to implement risk control measures designed to help prevent fraud, including monitoring of the IP static address for EIDL applicants.”

“With this new framework, SBA successfully stopped most of the applications from foreign IP addresses and is committed to ensuring that effective fraud controls are in place for future programs,” said the spokesman.

Former SBA Administrator Linda McMahon did not respond to a request for comment.

The possible payments to foreign recipients accounts for 0.04% of the $342 billion SBA disbursed through its program, according to the report. During the March 20, 2020, and Nov. 12, 2021 period, SBA processed over 233,000 applications.

SBA determined people had high-risk IP addresses based on them having fraud risk, connections to the “deep web,” or engaging in “suspicious online behavior,” says the report. Applicants that received the funds had IP addresses registered in multiple countries, including Nigeria, Pakistan, Ghana, and Mexico.

For instance, there were over 33,000 applications submitted from people with IP addresses in Nigeria, the report says. The applicants may have received over $19 million in loans, grants, and advances, the report says.

COVID-19 relief programs have been ripe for fraud and abuse. The Justice Department said in March 2021 it had charged 474 defendants with allegedly trying to illegally obtain over $569 million in funds from Economic Injury Disaster Loans and other programs.

Biden signed two bills in August giving DOJ more time to prosecute fraud related to both Economic Injury Disaster Loans and the SBA’s Paycheck Protection Program—another program for businesses to obtain COVID-19 relief loans.

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