UPDATED: August 21, 2022

Did you notice a hard inquiry pull on your credit report from the SBA even though you didn’t submit any loan application? Did someone take out an unauthorized small business loan under your name?

During the pandemic, the Small Business Administration (SBA) offered disaster relief loans such as PPP loans and EIDL to small businesses. Unfortunately, scammers find ways to take advantage of this.

How do you protect your identity from scammers?

In this article, you’ll learn the steps you need to take if you’re a victim of SBA loan identity theft. You’ll also learn what security measures you need to set up properly to reduce your risk of getting scammed.

Find out the best tip we’ve got to fight identity theft, and don’t miss out on any step so you won’t leave your information compromised.

What is SBA loan identity theft?

A Small Business Administration (SBA) identity theft takes place when an identity thief steals your personal information and uses it to apply for an SBA loan.

The SBA offers financial assistance to small business owners during the COVID-19 crisis. Such programs include the COVID-19 Economic Injury Disaster Loan (EIDL) program and the Paycheck Protection Program (PPP).

The PPP is an SBA-backed loan that helps small business owners keep their workers employed during the pandemic. They assist businesses with paying their workforce rather than terminating their employment due to revenue loss since the start of the pandemic.

Meanwhile, the EIDL program offers financial assistance to non-profit organizations and small business owners so they can recover from the economic impacts of COVID-19. 

The SBA provides funds to business owners to help with their financial obligations and operating expenses.

Criminals are taking advantage of these programs, hoping they would get money at your expense. 

They steal your information, such as your Social Security number or Employer Identification Number, and use it to take out a loan under your company’s name.

As a result, you’ll be surprised to receive billing statements for an SBA loan that you never applied for. Both small business owners and regular consumers can fall victim to such a scam.

How do you know if you’re a victim of SBA loan identity theft?

Listed below are the indications of identity theft:

  • You receive billing statements for a loan that you didn’t apply for.
  • You receive calls or letters from lenders or debt collectors for a loan you didn’t take out.
  • Your credit report shows an SBA-backed loan that you didn’t apply for.
  • Your credit report shows a hard inquiry from SBA, which could result in a lower credit score.

You must take action immediately once you suspect that you’re a victim of SBA loan identity theft or any other type of scam. 

What should you do if you’re a victim of SBA loan identity theft?

There are a few things you need to do if you discover that you or your business gets billed for an SBA loan that you don’t owe.

EIDL Loan Fraud

  • If it involves an EIDL loan fraud, contact SBA’s Office of the Inspector General.
  • Download EIDL identity theft letter for a guide on reporting the fraudulent activity to the SBA.
  • Email a copy of the report you filed with the FTC, a photocopy of a valid ID, and a copy of the declaration of Identity theft to [email protected].
  • You will receive written notification once the SBA completes its review and a final determination letter, which outlines its findings.
  • You may still receive monthly invoices for the fraudulent SBA EIDL loan. Keep the invoices while the SBA continues to process your identity theft report.

 PPP Loan Fraud

Other steps you can take

  • File an Identity Theft report with the Federal Trade Commission (FTC) at IdentityTheft.gov.
  • You can also call the Identity Theft Resource Center’s (ITRC) toll-free number 888-400-5530 or live chat with an expert advisor regarding the incident.
  • Contact the organization or institution involved and ask to close new accounts that were opened under your name without your permission.
  • Dispute the unauthorized loan with the credit reporting bureaus and request that the hard inquiry from your credit report.
  • Freeze your credit if you have no plans of taking out a loan anytime soon.
  • Place a fraud alert on your credit.
  • Check with the government agency where your business is registered and verify that your company’s registration status and ownership haven’t been changed.
  • Report to the Social Security Administration if your SSN was stolen and apply for a replacement.

What can you do to protect yourself from identity theft?

You must be careful and stay vigilant when it comes to protecting your personal and business information. Here are some security measures you can take:

  • The best way to protect yourself from identity theft is to never give out your personal information through phone, email, postal mail, or text. If you need to provide it, make sure you go directly to the office of the organization or financial institution.
  • You must also monitor your personal and business credit regularly from credit reporting agencies, such as Experian and Equifax.
  • Review your credit card and bank statements regularly.
  • Use unique and strong passwords for your account.
  • Shred all documents with personal information before throwing it away.
  • The SBA doesn’t initiate contact about any grants or loans. If you receive an unexpected call from someone who claims to be an SBA employee, suspect fraud right away.
  • Beware of communication from someone claiming to approve your SBA loan if you give an upfront payment.
  • Don’t respond to an email, text, call, or mail about a loan from the SBA. Get in touch with the office directly and verify. 


Small business owners like you continue to struggle in dealing with the effects of the pandemic on their businesses. As you try to keep your business afloat, you may easily fall prey to scammers.

You must remain vigilant and continue to watch out for possible fraudulent activities. Protect your personal and business information and be particularly discerning of any form of communication about loans.

Report any suspected scams or fraudulent activities on your account to respective authorities.