How to Avoid SBA Loan Scams: Tips for Businesses
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SBA loan scams are on the rise, targeting business owners seeking funding during COVID-19.

While banks have worked nonstop in recent days to process and fund new SBA loans through the Paycheck Protection Program (PPP), fraudsters are trying to exploit small business owners.

Watch out for SBA Loan Scams

Phone scams, Business Email Compromise, and check fraud are common 'vectors of choice' for fraudsters, and these scams are now being used to take advantage of COVID-19. Dubbed 'coronavirus scams' or 'SBA loan scams,' these scams target victims of the coronavirus who are awaiting SBA loans and receipt of stimulus payments, with scammers seeking to obtain personal identifiable information (often called PII). Once they have your PII, they may access your bank account or install ransomware or malware on your computer.

SBA loan scams may include:

  • Phishing attacks utilizing the SBA logo
  • Callers or spoof emails posing as a lender or financial institution and request the routing number, account number, or credit card number that you want to use to deposit your stimulus payment
  • Offers to process an SBA loan for you
  • Emails about SBA loans that do not originate from SBA sites (SBA sites end with '.gov')

Remember: the SBA does not reach out to individuals or businesses to initiate a loan, and will not ask for information that was already provided in the application process. These scenarios are attempts to obtain your private information or that of your business for nefarious purposes. Check out more scam scenarios from the SBA.

Protect Yourself and Your Business from Fraud

Anyone can become a victim of fraud, but taking these steps can go a long way in preventing fraud:

  • Utilize appropriate back-up- and malware detection systems to prevent and mitigate infection.
  • Train employees to be skeptical of emails, attachments and websites they don't recognize.
  • Take time to verify the instructions in an email before taking action.
  • Protect your personal and private information and secure your online systems with strong passwords that include a combination of capital letters, small letters, numbers and characters.
  • Don't use the same password on multiple sites.
  • Exercise caution when accessing links in emails or websites. Thoroughly investigate the link to insure it is legitimate.

As you work harder than ever to protect your business and employees amid the coronavirus pandemic, do not allow bad actors to hinder your efforts. If you have any doubt, reach out to your nearest SBA office.

If you believe that you are a victim of fraud, or if you have received a suspicious alert or communication, please call Regions Client Services immediately at 1-800-787-3905.

Find more resources for reporting fraud and helpful tips for fraud prevention.

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This information is general in nature and is not intended to be legal, tax, or financial advice. Although Regions believes this information to be accurate, it cannot ensure that it will remain up to date. Statements or opinions of individuals referenced herein are their own—not Regions'. Consult an appropriate professional concerning your specific situation and irs.gov for current tax rules. Regions, the Regions logo, and the LifeGreen bike are registered trademarks of Regions Bank. The LifeGreen color is a trademark of Regions Bank.