While they may offer up to $3 million in small business loans, posts about these on social media platforms like Facebook aren’t trustworthy.
Small businesses make up more than half of U.S. ventures as suggested by the Bureau of Labor Statistics. Sadly, most of these businesses end up failing leading many entrepreneurs to seek financial assistance or even support from the government.
Byron, however, was suspicious of Facebook posts he found that claimed the Small Business Administration was offering business loans, from thousands to millions of dollars, with no payback necessary.
One such post stated, “SBA announced $60K, Who needs a List of grants to get their business off the ground … guarantee approval in hours. (NO PAY BACK).”
Another post read, “Call all Business owners out here !!NEW GRANT OUT FUNDING FOR $50,000. MUST HAVE A LLC OR EIN!! And 25,000 for Individual Application. Don’t miss OUT again!!!!”
Contents
Fact or Fiction?
Are these Facebook posts offering small business loans bonafide?
The Verdict
No, these posts are not authentic.
The Investigation
Although authentic government grants for small businesses are available, these particular social media advertorials have been confirmed to be scams.
Our investigations, including reaching out to the Small Business Administration (SBA) and the U.S. Department of Health and Human Services, revealed several red flags. For one, applying for government grants is typically free and does not require a third party.
The SBA firmly advises against trusting anyone who offers guarantees on SBA loans for any upfront payment or presents an offer for a high-interest bridging loan.
Moreover, the rapid approval times claimed in these posts are highly unrealistic. Both the SBA and Grants.gov state that processing a grant or loan application can take at least a week or potentially longer.
An examination of these Facebook posts shows that they all contain identical language, suggesting a copypasta scam. Example: a post, allegedly from a Janet Billy, posted to a group for Houston-based food truck proprietors, was revealed through a reverse image search to be the profile of Dani Daniels, an LA-based adult performer, and not the indicated Houston food truck owner.
To find legitimate small business loans or grants, visit Grants.gov for eligibility checks and the SBA’s website for information on how to acquire a loan through a lender. If you encounter suspected small business loan fraud, directly contact the SBA OIG Hotline.
Our team at VERIFY is committed to debunking myths and helping you decipher facts from fiction. Please consider subscribing to our daily newsletter and joining us on YouTube, Snapchat, Instagram, Facebook and TikTok.
Frequently Asked Questions
How Can I Verify Authentic Small Business Loans or Grants?
For genuine small business loans or grants, check your eligibility on the Federal website, Grants.gov. Additionally, consult the SBA website about securing loans through approved lenders.
What Should I Do if I Encounter Suspected Small Business Loan Fraud?
Should you come across any suspicious activity related to small business loans or grants, immediately contact the SBA OIG Hotline directly.
What Signs Should I Look for to Identify Scam Posts?
Scam posts can usually be identified by unrealistic promises such as immediate approval, lack of transparency, or requests for upfront payments. Additionally, be wary of posts with identical language as it might be a copypasta scam. Always research and verify information independently before committing to any financial engagements.
