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Report File
Date Issued
Submitting OIG
Small Business Administration OIG
Other Participating OIGs
Small Business Administration OIG
Agencies Reviewed/Investigated
Small Business Administration
Report Number
24-02
Report Description

This report presents the results of our inspection to assess the U.S. Small Business Administration’s (SBA) Shuttered Venue Operators Grant (SVOG) controls to prevent disbursements to ineligible entities. Specifically, our review focused on general eligibility requirements applicable to all SVOG applicants and venue-specific requirements applicable to live venue operators.SBA delayed launching the SVOG application portal for over 2 weeks in April 2021 because of technical issues. In June 2021, SBA officials made program changes, which SBA called a “program refresh,” to accelerate application processing and to expedite the release of program funds. SBA stopped using the application portal to track applicant compliance with each eligibility requirement, switching instead to a manual checklist. SBA staff were instructed to presume applicant assertions to be true unless a clear indication of fraud was present. SBA also placed a strict 4-hour review time limit per application. Additionally, SBA limited or eliminated certain verification procedures.We recommended SBA management 1) reevaluate eligibility for the 47 SVOG applicants we reviewed and to recover funds from applicants determined to be ineligible and 2) implement additional controls for the monitoring, auditing, and compliance phases to prevent ineligible entities from receiving grants.

Report Type
Inspection / Evaluation
Special Projects
Pandemic
Agency Wide
Yes
Number of Recommendations
2
Questioned Costs
$22,878,968
Funds for Better Use
$0

Open Recommendations

This report has 2 open recommendations.
Recommendation Number Significant Recommendation Recommended Questioned Costs Recommended Funds for Better Use Additional Details
1 Yes $0 $0

To address the issues identified, we recommend the Administrator direct the Associate Administrator for the Office of Disaster Recovery and Resilience to reevaluate eligibility for the 47 applicants we questioned and recover grant funds from the ineligible applicants.

2 Yes $0 $0

To address the issues identified, we recommend the Administrator direct the Associate Administrator for the Office of Disaster Recovery and Resilience to implement additional controls to ensure that, during the monitoring, auditing, and compliance phases, awards are carefully screened to verify eligibility and to recover grant funds from ineligible entities.

Small Business Administration OIG

United States