June 27, 2013
Ethan Smith joined us during our webinar on negotiating the Offer in Compromise and discussed how important lender liability is in submitting an offer to the federal government.
Here are his insightful statements.
“As the lender, you have a liability to the federal government as a participant in the SBA loan program. This extends past making an overt misrepresentation to the federal government You must exercise due care to make sure you are not aiding and abetting a borrower in perpetrating a fraud to the federal government.”
“while you do not have an absolute requirement to certify that the documents that you are provided are genuine, are true, are not fraudulent, you cannot stick your head in the sand and turn a blind eye.”
“If there is something in the package that the borrower gives you that makes the hair on the back of your neck stand up I would definitely do a degree of diligence to make sure you feel confident that the offer is genuine, it’s in good faith, and not fraudulent because you don’t want to be on receiving end of a False Claims act investigation by the SBA.