Peggy E. (Peg) Gustafson was sworn in as SBA Inspector General on October 2, 2009. Ms. Gustafson previously served as General Counsel to Senator Claire McCaskill (D-MO), where she advised the...
Recovery Oversight Framework
To view the entire Recovery Oversight Framework, please click the PDF attachment below.
Oversight Framework for the American Recovery and Reinvestment Act of 2009 (P.L. 111-5)
The American Recovery and Reinvestment Act of 2009 (Recovery Act) provides for reduced loan fees, higher guaranties, new SBA credit programs, secondary market incentives, and enhancements to current SBA programs to help unlock credit markets and begin economic recovery for the nation’s small business sector. In order to provide unprecedented levels of transparency and accountability, the Recovery Act and related Office of Management and Budget (OMB) guidance require increased financial reporting on, and oversight of, programs, grants, and projects funded under the Act to deter and detect fraud, waste and abuse, and ensure that program goals are met.
To meet its oversight responsibilities under the Recovery Act, the OIG is developing oversight plans for deploying additional resources to provide “real-time” monitoring, evaluation, and reporting of SBA’s implementation of the Act. Since the Act provides very short time frames for obligating funds, there will be significant pressure on SBA to expedite and maximize financial assistance to small businesses. Past experience, such as SBA’s response to the 9-11 terrorist attacks and the 2005 Gulf Coast hurricanes, has shown that this pressure can significantly increase the vulnerability of SBA’s programs to fraud and unnecessary losses. Therefore, the OIG’s oversight efforts will focus heavily on assessing controls and detecting and deterring fraud, waste and abuse in Recovery Act programs. The OIG’s oversight plans will include both immediate and longer-term actions.
Immediate OIG Recovery Oversight Actions:
Establish internal OIG recovery oversight teams and processes, including reporting and cost tracking procedures, as well as an OIG recovery oversight website.
Meet with responsible agency officials and establish regular meetings and other communication processes to monitor and provide recommendations on development of agency Recovery Act actions before they are implemented.
Review all agency proposed controls (regulations, operating procedures, notices, etc.) relating to Recovery Act initiatives prior to issuance and provide recommendations to reduce potential waste, fraud, abuse and inefficiencies.
Review and provide recommendations on agency risk mitigation planning activities.
Review unimplemented audit recommendations and provide the agency with recommendations on unresolved internal control weaknesses that may affect Recovery Act initiatives.
Identify key fraud indicators that may increase potential losses in Recovery Act programs and issue a written notice to agency employees and loan program participants.
Contact trade associations and other outside entities to conduct fraud outreach efforts and identify potential oversight activities.
Issue solicitation and job announcements to obtain contracting and temporary personnel to conduct recovery oversight activities.
Prepare a detailed audit work plan for recovery oversight activities.
Longer-term OIG Recovery Oversight Actions:
The table below summarizes potential risks related to SBA’s implementation of the Recovery Act and provides a framework for potential additional OIG activities to address these risks.
To view this table, please click the attached PDF below.