Phony farms tied to billions in SBA loan fraud shock Tampa residents

8 On Your Side

TAMPA, Fla. (WFLA) – The farms are phony, but the fraud is real for several residents who had no idea their personal information was used to secure fast-tracked, government loans meant for businesses struggling during the pandemic.

James Shipley, who lives on a 14,000 square foot, waterside lot in north Tampa, was shocked to discover “James Shipley Farms” was supposedly located at his address and received a $47,000 Economic Injury Disaster Loan (EIDL).   

“I obviously have no room to farm here,” Shipley said. “Nobody’s ever called me. If you hadn’t knocked on my door, I wouldn’t have ever known about it. That’s how shocked I am.”

Other Tampa residents were equally surprised after finding out their names and addresses were attached to farms that government records indicate are peppered across the city.

William Dreyer, 85, has St. Augustine grass growing in his front yard and palm trees rising above his south Tampa home, but no crops.

“Dreyer Farms” received a $9,900 loan according to records, and while Dreyer acknowledges he has relatives who farm in New Jersey, he is a retired executive.

“I’ve lived here nearly 50 years and never picked up a hoe,” Dreyer said. “I’m on a little plot, 100 by 100 here. No farm.”

The loans are administered by the Small Business Administration (SBA) and were created to help businesses blot red ink caused by the COVID-19 pandemic.

8 On Your Side extracted all the Florida-based loans from a massive SBA spreadsheet of more than three million loans worth $194 billion handed out across the country since spring.

After pulling the Tampa-based transactions from the state’s list, a second search found dozens of loans to farms. Several of those businesses were not registered with the Florida Division of Corporations, and further searches revealed 24 Tampa-based loans worth more than $600,000 were made to farms that don’t exist.

That total is a blip in the alleged fraud connected to the program nationally, according to an SBA Office of Inspector General report that expressed concerns about fraud for more than $78 billion in loans.

An SBA spokesperson connected us with Kathy Cook from the agency’s Atlanta-based Office of Disaster Assistance.

Cook said there are “checks and balances in place” to guard against fraud but she would not provide specifics.

South Florida SBA Director Victoria Guerrero referred us back to Cook’s office and bristled when pushed for answers about what went wrong to allow these fraudulent loans to be approved in Tampa and across the country.

“You cannot misconstrue,” Guerrero said. “We will stop this interview right now if your attempt is to put us in a bad light. I am not saying the SBA does not have any checks and balances.”  

Gus Bilirakis, a Republican from Florida’s 12th Congressional District, called the fraud “inexcusable.”

“There was an ability to double check on these people to make sure it was legitimate,” Bilirakis said. “This shouldn’t happen, and these people need to be held accountable.”

Bilirakis, the ranking member of the House Consumer Protection Committee, said congress will be examining the process to make sure the money is allocated appropriately.

Shipley, who works for the federal government, wonders about businesses that needed the money but didn’t get it.

“Every penny should be accountable, and the government has the due diligence to make sure they do their job on their end to make sure the money is going to right place,” he said.

Cook said if someone suspects identity theft or fraud, they should report it to the credit bureaus and make a police report about the application.

According to Cook, the SBA will be prompted to research the loan after it is reported to the agency.

“The inquiry will be removed from the credit report which should restore your credit score to what is was previously,” Cook wrote in an email. “The [individual] is not responsible for the payment of any loan in which you did not apply.” 

Copyright 2021 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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