FTC Warns Companies About COVID-19 U.S. Small Business Administration Loan Promises
By Federal Trade Commission // July 1, 2020
Don’t apply for a loan without verifying the lender
(FTC) – The latest recipients of government warning letters are six companies that said they could speed U.S. Small Business Administration (SBA) loans for businesses struggling to stay afloat during the COVID-19 pandemic.
The letters – from the FTC and the SBA – direct the companies to remove all false claims from their websites immediately.
According to the FTC and SBA, the letter recipients may be misleading consumers that they are affiliated with the SBA or about their role in helping businesses get SBA Paycheck Protection Program (PPP) loans.
As a result, small businesses that applied for the loans through the listed websites may be left empty-handed.
The agencies said one or more of the companies might be misleading small business owners by:
Using the SBA’s name or official logo on their websites;
Promising easy applications and quick approvals;
Telling consumers they can apply right on their website; and
Listing their address as the SBA’s headquarters in Washington.
The letters require the companies to notify the FTC within 48 hours of the specific actions they have taken to address the agencies’ concerns.
The FTC will follow up with companies that fail to make adequate corrections.
The FTC and SBA sent the letters to Taycor Financial (disasterloanassistance.com); SBADisasterLoan.org; USAfunding.com; SBALosAngeles.com; Madison Funding Partners (madisonfundingpartners.com); and NYMBUS (NYMBUS.com).
Here are some tips that can help you avoid scammers:
Don’t apply for a loan without verifying the lender. Only SBA-authorized lenders can provide PPP loans, and other loans may be available through SBA directly.
To find an SBA-authorized lender in your area, use this SBA tool.
Be cautious about companies that offer to expedite or facilitate your ability to get PPP loans or that promote a special relationship with the SBA.
If you think a company misled you about an SBA loan, please let us know at ftc.gov/complaint.