Feds warn small businesses of potential coronavirus SBA loan fraud

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Federal officials on Friday warned small businesses to be alert for scammers looking to take advantage of federal aid for entrepreneurs struggling during the coronavirus pandemic.

The $2 trillion CARES act, passed by Congress in March, set aside $349 billion worth of loans for small businesses.

A diner inside the Horseshoe Cafe in Wickenburg, Ariz., this past Friday.  (AP)

Under the program, small businesses may apply for loans through the Small Business Administration (SBA). The SBA did not initiate loans, nor did it require information already provided in the application.

The feds warned entrepreneurs that anyone asking for money was “not legitimate, nor are emails that end in anything but ‘.gov’.”

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“Those who prey on others look for opportunities like the various loans provided to small businesses.  United States Attorneys and our respective law enforcement partners, like the FBI, are on the lookout for those predators. We strongly encourage those who become aware of such scams to report it to the authorities so we can take action,” said U.S. Attorney for the Northern District of West Virginia Bill Powell.

Eugene Kowel, the acting special agent in charge for the FBI in Pittsburgh,  urged companies to use backup and malware-detection systems and to train employees “to be skeptical of emails, attachments and websites they don’t recognize.”

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The warning came amid a general uptick in criminal scams related to the coronavirus pandemic.

Last month, the FBI put out an alert warning that the pandemic was providing criminals with illicit opportunities at “breathtaking” speed.