Peggy E. (Peg) Gustafson was sworn in as the Inspector General of the U.S. Small Business Administration on October 2, 2009. Ms. Gustafson previously served as General Counsel to Senator Claire...
Audit Report 7-26: Audit of Liquidation of Disaster Loans
On June 1, 2007, the OIG issued Audit Report Number 7-26, Audit of Liquidation of Disaster Loans. The objective of the audit was to determine if the Small Business Administration (SBA) maximized its recovery of delinquent disaster loans through collateral liquidations and referral to the U.S. Department of the Treasury (Treasury). The OIG randomly selected five samples of secured and unsecured disaster loans in various stages of collection as of July 26, 2005. The OIG examined SBA loan files maintained on SBA's information systems, conducted site visits at the Santa Ana Disaster Loan Liquidation Center, the El Paso and Birmingham Serciing Centers, and interviewed SBA officials in teh Office of Financial Assistance.
The OIG found that the SBA did not maximize recovery on at least $360.3 million sent to SBA's Liquidation Center and Treasury because of miscoded loans, data system errors, and continued servicing activities after delinquent loans were transferred to the Disaster Loan Liquidation Center.