OIG report: ‘Serious issues,’ possible misuse of taxpayer dollars at Alabama Women’s Business Center locations

The U.S. Small Business Administration’s (SBA) Office of Inspector General (OIG) has released a report identifying “serious” material deficiencies with Women’s Business Center, Inc., an Alabama-based recipient of the SBA’s Women’s Business Center (WBC) grant program.

Women’s Business Center, Inc. is responsible for operating two WBCs, located in Mobile and Brewton.

In the course of the OIG’s audit of SBA’s oversight of the nationwide WBC program, Women’s Business Center, Inc. denied OIG auditors access to both coastal Alabama center’s offices and records.

After issuing an administrative subpoena, the SBA OIG uncovered that both WBCs had actually been permanently closed since the fall of 2018 yet were still collecting federal government funds.

Further violations uncovered by the OIG included inadequately staffing centers, late and unpaid payroll, a major potential conflict of interest and failure to maintain an adequate financial management system and audited financial statements.

The OIG’s report concluded:

We determined that the Recipient has materially violated federal statutes, regulations, and the terms and conditions of its cooperative agreements. Its lack of required financial systems, records, and policies, and inability to pay its obligations, maintain open and available facilities and service hours, and staff its WBCs with full-time program directors indicates serious issues in the Recipient’s ability to operate and fulfill the WBC program requirements. We have deemed the documentation the Recipient has provided to us to be insufficient and incomplete. The Recipient denied access to OIG, an independent, authorized oversight entity, and disregarded governing federal regulations and terms and conditions of its cooperative agreements.

These findings impel SBA to take prompt corrective action to protect taxpayers’ dollars and help to ensure the integrity of the WBC program. SBA should pursue actions including, but not limited to, suspension, termination, and nonrenewal of the Recipient’s cooperative agreements, as well as suspension and debarment of the Recipient and its personnel.

In a statement reacting to the OIG report, U.S. Senator Marco Rubio (R-FL), chairman of the Senate Committee on Small Business and Entrepreneurship, said, “The gross lack of oversight uncovered in the SBA OIG’s most recent management advisory is incredibly troubling.”

“SBA must take action to remedy the numerous deficiencies identified and enact the Office of Inspector General’s recommendations immediately,” he added. “I appreciate the Office of the Inspector General’s diligence in this matter and look forward to its swift resolution.”

Read the OIG report here.

Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn