SBA administrator defends loan reforms, cites $630 million identified by 'Doge' team; members press on inspector general removal and data access

Administrator Kelly Loeffler outlined changes to SBA lending and oversight she said were intended to reduce fraud and restore program integrity. She told the House Small Business Committee the agency reinstated lender fees, tightened underwriting standards, and implemented identity and citizenship verification steps to ensure loan eligibility.

On fraud detection Loeffler credited an internal data team—referred to repeatedly in the hearing as the “Doge” team—with identifying $630,000,000 in fraudulent loans and locating loans approved for ineligible recipients. In response to direct questions about the provenance of the fraud figures, Loeffler said the team was composed of vetted federal employees and that the work helped the agency “cancel” loans to ineligible recipients.

Why it matters: Members across the aisle pressed for specifics about the data access and vetting used by the Doge team and asked whether the team had access to personnel files and personally identifiable information. Several Democrats described the committee’s difficulty obtaining records and called for in‑camera review of pertinent case files. Loeffler said the team members are federal employees who were vetted and that the agency is willing to work with the committee on review procedures.

Inspector general and oversight concerns: Members voiced concern about the firing of the SBA inspector general who served under the prior administration. Representative Scolton and others called the post a critical independent watchdog role; Loeffler said the administration is working on a nomination and will have someone in the seat “as soon as it’s confirmed in the Senate.” Committee members pressed for a timeline and for assurances the new IG nominee will be independent and skilled in auditing and oversight.

Loan program results and defaults: Loeffler told the committee the 7(a) program was previously mismanaged, saying earlier underwriting changes had produced negative cash flow and defaults. She said the agency reversed those policies and that loan approvals increased in the current administration’s first 100 days (witness statements cited an 80% increase in approvals compared to the same period under the previous administration). Members requested more documentation on defaults, loan cancellation decisions and the underlying data used by the fraud‑detection effort.

Next steps: committee members asked for access to the records and documentation underpinning the fraud figures and sought information about the vetting and authorities allowing the Doge team to access SBA systems. The administrator committed to cooperating with oversight requests and to providing nominations and updates about the inspector general vacancy.