FTC, SBA Issue Six Warning Letters to Companies Marketing Misleading Claims to Small Businesses Seeking COVID-19 Relief Loans

The FTC and the U.S. Small Business Administration (SBA) sent a second set of warning letters to companies for misleading small businesses seeking SBA loans because of the coronavirus pandemic. According to the letters, the six targeted companies made claims that could lead businesses to believe that the companies were affiliated with the SBA, or that businesses could apply through their websites for loans through the Paycheck Protection Program (PPP) or other programs covered by the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The companies receiving letters are:

• TF Group for using the SBA’s official logo on its website and for claiming to offer “COVID-19 SBA Loan Programs and inviting consumers to “Quick Apply;”
• SBADisasterLoan.org for claiming to operate from the SBA’s address in Washington, as well as offering the services of “SBA Lending experts” and “SBA Loan Officers;”
• Small Business Advocates – Los Angeles for using the name “SBA Los Angeles” and “SBA LA” on its website and social media in addition to offering “SBA Loans;”
• Madison Funding Partners, Inc. for claiming that consumers could “[a]pply for the PPP Loan now” and ”[g]et matched with a PPP lender now;”
• NYMBUS, Inc. for claiming that consumers can “Apply Now” for its program, which “is able to process your SBA Paycheck Protection Loan faster than any other source;” and
• USAFunding.com for describing the PPP loan program and urging consumers to “APPLY NOW.”

The letters warn the recipients to immediately address the agencies’ concerns and to remediate any harm done to small business consumers as a result of the claims. Recipients are also required to notify the FTC within 48 hours of the specific actions taken to resolve the issues.

View the press release.