The Small Business Administration (SBA) is tightening loan application requirements and downsizing its workforce after a federal review uncovered fraudulent lending practices. The changes follow an investigation by the Department of Government Efficiency (DOGE), which revealed that billions in loans were disbursed to individuals of improbable ages—including a 157-year-old recipient.
In a post on social media platform X, the DOGE announced two key adjustments:
- Loan applicants must now provide their date of birth.
- Direct SBA loans will no longer be available to individuals under 18 or over 120 years old.
These changes aim to curb fraud in federal loan programs, including the Paycheck Protection Program (PPP) and Economic Injury Disaster Loans (EIDL), which were widely used during the pandemic.
As of Friday, @SBAgov now:
– Requires date of birth collection for all direct loan applications
– Pauses the direct loan process for those under 18 and above 120 years oldBasic sanity checks like these are initial steps towards minimizing fraud in government payment programs. https://t.co/PHCd4l6SPU pic.twitter.com/dPPnwqMBvD
— Department of Government Efficiency (@DOGE) March 24, 2025
In a separate post, DOGE disclosed that between 2020 and 2021, more than 3,000 loans totaling $333 million were approved for individuals listed as over 115 years old in the Social Security database.
Beyond loan application reforms, the SBA is undergoing a major restructuring, reducing its workforce by 43%, affecting 2,700 employees. The agency says these cuts—resulting from voluntary resignations, expiring pandemic-era contracts, and select layoffs—will not impact core loan and disaster assistance programs.
According to the SBA news release, administrator Kelly Loeffler stated, “The SBA was created to be a launchpad for America’s small businesses by offering access to capital… But in the last four years, the agency has veered off track—doubling in size and turning into a sprawling leviathan plagued by mission creep, financial mismanagement, and waste.”
The SBA will also take over the administration of federal student loans, previously handled by the Department of Education.
DOGE described the loan application changes as “basic sanity checks” aimed at preventing further abuse of government relief funds. These reforms take effect immediately, while workforce reductions will roll out in the coming months.
