Small Business Administration (SBA) Administrator Kelly Loeffler announced late Thursday that her agency was suspending thousands of “Minnesota borrowers” amid “suspected fraudulent activity” involving COVID pandemic-era lending programs.
Loeffler wrote in an X post that the SBA had taken action to suspend 6,900 borrowers in Minnesota after reviewing “thousands” of potentially “fraudulent” Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) loans approved in the state. She added that “borrowers” in the state suspected of fraud had been approved for 7,900 PPP and EIDL loans totaling $400 million. (RELATED: Trey Gowdy Explains What Spared Tim Walz From ‘Running For His Life’ From MN Taxpayers)
“In total, these borrowers were approved for 7,900 PPP and EIDL loans worth approximately $400M,” Loeffler wrote in the social media post. “These individuals will be banned from all SBA loan programs, including disaster loans, going forward. We will also refer every case, where appropriate, to federal law enforcement for prosecution and repayment.”
“After years, the American people will finally begin to see the criminals who stole from law-abiding taxpayers held accountable – and this is just the first state,” Loeffler continued.
Over the last week, SBA has reviewed thousands of potentially fraudulent pandemic-era PPP and EIDL loans approved in Minnesota.
Today, our agency took action to suspend 6,900 Minnesota borrowers amid suspected fraudulent activity. In total, these borrowers were approved for…
— Kelly Loeffler (@SBA_Kelly) January 2, 2026
Democratic Minnesota Gov. Tim Walz’s administration has recently been grappling with allegations of fraud related to Somali-run operations in the Minneapolis–St. Paul area. Loeffler sent a letter to Walz on Dec. 23 stating that her agency will “halt” over $5.5 million in annual funding to Minnesota “until further notice,” Fox News first reported.
Today, I informed Governor Tim Walz that SBA is halting $5.5 million in annual funding to Minnesota pending further review.
This action follows alarming findings: individuals indicted in the $1 billion Somali fraud scheme also received at least $3 million in PPP loans, and SBA…
— Kelly Loeffler (@SBA_Kelly) December 23, 2025
A variety of pandemic-era relief programs, including the PPP, have notably been targeted by fraudulent activity, the Daily Caller reported in Oct 2024. Three Chinese-owned firms agreed to dole out $7.3 million to resolve allegations they submitted false claims in order to secure PPP loans, the Department of Justice (DOJ) announced on Dec. 16.
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