Federalbrief
Jan 06, 2026

SBA’s Loeffler Says Minnesota Fraud Is Tip Of The Iceberg

SBA Administrator Kelly Loeffler said Friday that the massive fraud uncovered in Minnesota is only the beginning and warned that criminal prosecutions are coming nationwide. Loeffler made the remarks during an appearance on Fox News Channel’s “Hannity,” which was guest-hosted by Jason Chaffetz, Breitbart reported.

“You’re right,” Loeffler said when asked about the scope of the fraud. “It’s a ton of money and it’s just the tip of the iceberg happening in Minnesota.”

She said investigators initially believed the fraud totaled roughly $1 billion but now know the figure is significantly higher.

Loeffler said her team uncovered $3 million in fraud within three days after launching a review of SBA loans during Thanksgiving weekend.

She said investigators identified roughly 7,900 fraudulent loans involving about 6,900 individuals.

Loeffler said some individuals took out multiple loans and have now been permanently banned from doing business with the Small Business Administration.

“They will not get a disaster loan,” she said. “They cannot get SBA funding.”

Loeffler said the SBA will turn its findings over to federal authorities.

“We’re going to see people in handcuffs,” she said. “We’re going to see people in jail.”

Republican challenger John Nagel is accusing Democratic Rep. Ilhan Omar of being closely linked to the $1 billion Feeding Our Future fraud scandal, which is based in her Minneapolis congressional district. Nagel, who is running against Omar in Minnesota’s 5th Congressional District, claims that legislation introduced by Omar contributed to the circumstances that allowed the fraud to take place.

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