WASHINGTON, July 30, 2025 (GLOBE NEWSWIRE) -- Today, the U.S. Small Business Administration (SBA) announced its decision to rescind the independent 8(a) contracting authority of the U.S. Agency for International Development (USAID). The decision comes after an investigation by the U.S. Department of Justice (DOJ) uncovered a massive $550 million bribery scandal involving a USAID contracting officer and two 8(a) contractors. Last fiscal year, USAID obligated $3.6 billion through SBA’s 8(a) Business Development Program.
“Under the Trump Administration, the SBA will not tolerate the abuse of the government contracting process,” said SBA Administrator Kelly Loeffler. “The decision to revoke USAID’s independent 8(a) contracting authority is necessary to prevent further wrongdoing by an agency with a well-documented record of waste, criminal fraud, and bribery. Taxpayers will no longer foot the bill for outright corruption perpetrated by those entrusted with Americans’ hard-earned tax dollars.”
The 8(a) Business Development Program is a government contracting program governed by the SBA, designed to help socially and economically disadvantaged small businesses access sole-source and competitive set-aside contracts within the federal marketplace. SBA authorizes federal agencies to execute contracts to 8(a) certified businesses on its behalf. But today, SBA sent notice to USAID that the agency is no longer authorized to award or execute independent 8(a) contracts based on findings of rampant fraud and abuse at the agency.
Last month, a DOJ investigation revealed that over $550 million in government contracts were fraudulently steered through bribery of a USAID contracting officer. One 8(a) contractor, despite being officially flagged by USAID as lacking “honesty or integrity,” went on to be awarded an additional $800 million federal contract to evaluate “the root causes of irregular migration from Central America.”
In addition to rescinding the independent contracting authority of USAID, Administrator Loeffler has also ordered a full-scale audit of the 8(a) program, including high-dollar and limited-competition contracts over the last 15 years. Findings will be referred to the SBA Office of Inspector General and DOJ for enforcement, and the SBA will pursue all available actions to recover misused funds.
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About the U.S. Small Business Administration
The U.S. Small Business Administration helps power the American dream of entrepreneurship. As the leading voice for small businesses within the federal government, the SBA empowers job creators with the resources and support they need to start, grow, and expand their businesses or recover from a declared disaster. It delivers services through an extensive network of SBA field offices and partnerships with public and private organizations. To learn more, visit www.sba.gov.
SBA HQ Press Team U.S. Small Business Administration press_office@sba.gov
