Protect Your Business From Falling Victim
BUSINESS | APRIL 09, 2020 | PEOPLES STATE BANK
Where there are large sums of money, you can bet there are people who try to scam you. Such is the case with the government funds to help small businesses through the COVID-19 pandemic. Federal and state officials have already been contacted by businesses who have had scammers try to gain access to their SBA Paycheck Protection Program (PPP) or Emergency Injury Disaster Loan (EIDL) funds.
The first thing you need to know is the difference between the PPP and the EIDL. The PPP is an SBA-backed loan that is processed by a financial institution that is SBA-approved. Peoples State Bank is an SBA-approved lender and has already processed hundreds of PPP loans. If you are contacted by someone who is not connected to the bank you are working through specifically for a PPP loan, then it is likely a scam.
Additionally, the SBA will not contact you or your business if you are working with a bank on a PPP loan. If the SBA has questions about the application you’ve submitted to the bank, they will contact the bank for answers. Also, your bank will supply a loan confirmation to you—no business email addresses are being submitted to the SBA for a PPP loan.
The EIDL is also an SBA-backed loan, but unlike the PPP, the EIDL is handled directly through the SBA. If you’ve applied for an EIDL, you’ll be working with the SBA directly on getting approval. A local bank, like Peoples, is not involved in the EIDL process. Your only communication on this will be with the Small Business Administration. If you receive calls, emails, or other communications claiming to be from the Treasury Department or the SBA, and they ask for personal or business financial information that seems out of the ordinary, do not respond. Your best bet is the contact the SBA directly through the process you had used to set up your EIDL funding.
The SBA will not initiate contact with a business on either a 7a or Disaster loans or grants. If you are proactively contacted by someone claiming to be from the SBA (to start an application), suspect fraud and don’t share any personal or business information with them.
Here are some things to watch for in emails from the SBA:
- Look for the referenced application number that you were provided during the loan process, and that it matches what’s listed in the email you received
- Scammers are now stealing SBA logos and making their emails and other communications look as close to real as possible—don’t assume it’s legitimate. These emails may be phishing attacks, attempts to steal your personal information, get access to bank accounts, or to install ransomware or malware on your computer.
- Make sure the email is actually from the SBA by looking at the email account which should end in @sba.gov
- In emails that state they are SBA approved, don’t assume it’s legitimate—verify and cross-reference any information you receive with information available at www.sba.gov
And for any type of funding, whether it’s the PPP or EIDL, be aware that you won’t have to make a payment upfront, you won’t have to take out a high-interest bridge loan while waiting for funds, and that if a loan offer comes with more than a 3% borrower fee, it’s likely fraud, as the SBA limits what a broker can charge for emergency loans.
For more information on SBA Programs – scams and fraud alerts, click here. https://www.sba.gov/document/report--sba-programs-scams-fraud-alerts
Peoples State Bank
Peoples State Bank is a community bank headquartered in Wausau, Wisconsin, serving north, central, and southeast Wisconsin from ten full-service banking locations in Marathon, Oneida, Vilas, Waukesha, and Milwaukee Counties, as well as a commercial loan production office in Stevens Point, WI.
Peoples State Bank is a community bank headquartered in Wausau, Wisconsin, serving north, central, and southeast Wisconsin from ten full-service banking locations in Marathon, Oneida, Vilas, Waukesha, and Milwaukee Counties, as well as a commercial loan production office in Stevens Point, WI.