The fear, anxiety and general confusion and panic that are widespread during the coronavirus pandemic have created a perfect breeding ground for scam artists. Known for taking advantage of any desperate situation, fraudsters are perfectly positioned to push all the right ‘emotional buttons,’ especially regarding the complicated process of applying for an emergency loan.
With the spotlight on two of the Small Business Administration’s loans – Paycheck Protection Plan (PPP) and the Economic Injury Disaster Loan (EIDL) – as well as other emergency loans being put forth by legitimate sources, scam artists know how to confuse and agitate their targets.
To do your best to protect yourself and your confidential financial information, remember these six key points:
- The Small Business Administration (SBA) does not initiate contact on disaster loans or grants. If you are proactively contacted by someone claiming to be from the SBA, it is probably not a legitimate call.
- If you are contacted by someone promising to get approval of an SBA loan for you, but asking you for any payment up front or offers a high interest bridge loan in the interim, this is not a legitimate call.
- The SBA limits the fees a broker can charge a borrower to 3% for loans $50,000 or less and 2% for loans $50,000 to $1,000,000 with an additional ¼% on amounts over $1,000,000. Any attempt to charge more is not legitimate.
- If you are in the process of applying for an SBA loan and receive email correspondence asking for your Personally Identifiable Information (PII), ensure that the referenced application number is consistent with your actual application number or call to confirm.
- Look out for scams utilizing the SBA logo. These may be attempts to obtain your personally identifiable information (PII), in order to access your personal banking information or to install ransomware/malware on your computer.
- Remember – any email communication from SBA will come from accounts ending with sba.gov.
Even when you are distracted or anxious, take the time to react in a thoughtful manner without haste in any of these situations or others that make similar claims or offers. Call us if you have any questions!
