How does SBA protect against fraud and other wrongdoing in the SBIC program?
Prior to receiving an SBIC license, the applicant must undergo a rigorous licensing process. Upon receiving a license, the SBIC is subject to an annual regulatory audit by the Office of SBIC Examinations. These audits are designed to ensure that SBICs are in compliance with the regulations or to uncover those instances when they have failed to do so. Potential fraud is often uncovered after an SBIC has been transferred to the Office of SBIC Liquidation. These cases are referred to the Office of the Inspector General for investigation and possible referral to the Assistant US Attorney for prosecution.
