• What Happened: The Trump SBA suspended over 111,000 California borrowers suspected of $8.6 billion in pandemic-era PPP and EIDL loan fraud.
  • Why It Matters: SBA Administrator Kelly Loeffler called it a crackdown on "staggering" corruption and cited California's "culture of fraud and abuse" that went unchecked for years.
  • Bottom Line: California AG Rob Bonta called the findings politically motivated, but the numbers speak for themselves.

The Trump administration just handed California its biggest fraud reckoning yet, and the numbers are absolutely staggering.

The Small Business Administration, now under Administrator Kelly Loeffler, announced the suspension of more than 111,000 California borrowers suspected of fraudulently obtaining pandemic-era loans. The total tab: $8.6 billion in Paycheck Protection Program and Economic Injury Disaster Loan funds that investigators believe were stolen from American taxpayers during the COVID-19 pandemic.

To be specific, the SBA suspended 111,620 California borrowers who received 118,489 loans. That is not a rounding error. That is a statewide fraud operation hiding in plain sight while Gavin Newsom ran the show in Sacramento.

Loeffler did not hold back in describing what the Trump administration found. She called it a crackdown on "staggering" corruption that had been tolerated for years and specifically called out California's "culture of fraud and abuse" as the driving force behind the numbers.

For context, the SBA ran a similar sweep in Minnesota and found roughly $400 million in suspected fraudulent COVID loans. California came in at $8.6 billion. That is not a coincidence. That is a culture problem.

California Attorney General Rob Bonta responded by calling the findings "baseless" and politically motivated, insisting that California is a victim of fraud rather than the perpetrator. He pointed to nearly $2.7 billion the state helped recover over the last decade as proof of good faith efforts.

But recovering $2.7 billion while $8.6 billion walks out the door is not exactly a win worth bragging about.

American taxpayers funded these loans to help small businesses survive a pandemic. In California, more than 111,000 people allegedly treated that money like a personal ATM. The Trump administration is finally making them answer for it.