7(a) Loan Guarantees Purchases

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Program level Payment Integrity results

Sponsoring agency: Small Business Administration

View on Federal Program Inventory

PROGRAM METRICS

$568 M

in FY 2021 outlays, with a

96.7%

payment accuracy rate

PROGRAM METRICS

$707 M

in FY 2022 outlays, with a

95.8%

payment accuracy rate

PROGRAM METRICS

$794 M

in FY 2023 outlays, with a

93.9%

payment accuracy rate

PROGRAM METRICS

$1,395 M

in FY 2024 outlays, with a

94.7%

payment accuracy rate

PROGRAM METRICS

$2,116 M

in FY 2025 outlays, with a

98.5%

payment accuracy rate

  • Improper payment estimates over time
    View as:

    Chart toggle amounts:
    Proper payments
    Overpayment
    Underpayment
    Technically improper
    Unknown

Payment Integrity results

  • FY 2021 improper payment estimates

    Chart legend and breakdown

    Payment accuracy rate

    Improper payment rate

    Unknown payment rate


    Sampling & estimation methodology details

    Sampling timeframe:

    04/2020 - 03/2021


    Confidence interval:

    >95%


    Margin of error:

    +/-3.0

Overpayments

Overpayment root cause Overpayment amount
Amount of overpayments within the agency's control $16.55 M
Amount of overpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of overpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of overpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $16.55 M

Overpayment root cause Overpayment amount
Amount of overpayments outside the agency's control $0.0 M

Underpayments

Underpayment root cause Underpayment amount
Amount of underpayments $2.46 M
The amount of underpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of underpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of underpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $2.46 M

Technically improper payments

The amount of improper payments that were paid to the right recipient for the correct amount but were considered technically improper because of failure to follow statute or regulation $0.0 M

Additional information

$2.46 M

Unknown Payment Details

Evaluation of corrective actions

Corrective Actions are structured based on the Root Cause of the Improper Payment. Root causes are shared with management throughout the review cycle. Corrective Actions, such as External training is formulated to address root causes of improper payments. Collaboration and communication with other offices within SBA about improper payments focuses on specific loans, lenders and root causes of the improper payment.


Future payment integrity outlook

7(a) Loan Guarantees Purchases has NOT established a baseline.

The program's current year improper payment and unknown payment rate of 3.35 % has been achieved with a balance of payment integrity risk and controls and represents the lowest rate that can be achieved without disproportionally increasing another risk, therefore it is the tolerable rate.

Additional programmatic information

  • FY 2022 improper payment estimates

    Chart legend and breakdown

    Payment accuracy rate

    Improper payment rate

    Unknown payment rate


    Sampling & estimation methodology details

    Sampling timeframe:

    04/2021 - 03/2022


    Confidence interval:

    95% to <100%


    Margin of error:

    +/-3.0

Overpayments

The root cause for 7(a) loan guaranty purchases improper payments was identified as Failure to Access Data/Information. Improper payments generally arose when purchase processors failed to identify lenders’ deficiencies in the evaluating, processing, closing, disbursing, servicing, liquidating, or litigating an SBA guaranteed loan.
Overpayment root cause Overpayment amount
Amount of overpayments within the agency's control $26.66 M
Amount of overpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of overpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of overpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $26.66 M

Overpayment root cause Overpayment amount
Amount of overpayments outside the agency's control $0 M

Underpayments

Underpayment root cause Underpayment amount
Amount of underpayments $2.67 M
The amount of underpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of underpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of underpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $2.67 M

Technically improper payments

The amount of improper payments that were paid to the right recipient for the correct amount but were considered technically improper because of failure to follow statute or regulation $0.0 M

Additional information

$2.67 M

Unknown Payment Details

Overpayment to a lender is questioned. Lender is currently in discussions with the agency to determine validity of this payment.

The amount of payments that could either be proper or improper but the agency is unable to determine whether they were proper or improper as a result of insufficient or lack of documentation is $0.46 M


Cause of insufficient or lack of documentation & why the documentation is needed for determination of payment type
Payment cause Amount Description of the documentation that was not provided and explanation of why the program is unable to conclude whether the payment is proper or improper without that documentation

Evaluation of corrective actions

Corrective actions are tracked at the loan level through a centralized database. The Quality Control Specialists for the 7(a) guaranty purchase centers monitor errors from identification through completion of the corrective action. Headquarters management provides oversight to ensure milestones are met. Improper payments identified as a result of the FY 2022 PIIA reviews have been resolved through obtaining additional documentation, referral for denial review, collection of funds from the lender, or reimbursement to the lender. Corrective actions were generally completed at the loan level within 60 days, and all actions were taken by the end of the fiscal year.

Future payment integrity outlook

7(a) Loan Guarantees Purchases has established a baseline.

The estimated rate of 4.15 percent improper payments and 0.07 percent in unknown payments totals 4.22 percent. Because the lower bound of its confidence interval, 1.76 percent, is lower than the reduction target rate of 3.25 percent, in accordance with OMB Appendix C to Circular A-123 (March 2021), the 7(a) loan guaranty purchase program is considered to have met its reduction target. For FY 2023, the SBA established a reduction target of 4.05 percent for the 7(a) loan guaranty purchases program.

Out-Year improper payment and unknown payment projections and target
Current year +1 estimated future outlays $946.57 M
Current year +1 estimated future improper payments $38.34 M
Current year +1 estimated future unknown payments $0 M
Current year +1 estimated future improper payment and unknown payment rate 4.05 %
Current year +1 estimated future improper payment and unknown payment reduction target 4.05 %

The program's current year improper payment and unknown payment rate of 4.21 % may or may not be the tolerable rate. The agency has not yet determined the tolerable rate for this program.

The root cause of the improper payments for this program are identified to be within agency control. As such, the SBA has not established a tolerable rate for this program.

The agency has what is needed with respect to internal controls, human capital and information system and other infrastructure to reduce improper payments and unknown payments to the tolerable rate.

No resources were requested in the most recent budget submission to establish and maintain internal controls.

Additional programmatic information

Program level payment integrity related information has been captured through the survey.

  • FY 2023 improper payment estimates

    Chart legend and breakdown

    Payment accuracy rate

    Improper payment rate

    Unknown payment rate


    Sampling & estimation methodology details

    Sampling timeframe:

    04/2022 - 03/2023


    Confidence interval:

    95% to <100%


    Margin of error:

    +/-3.0

  • Actions taken & planned to mitigate improper payments

    Mitigation strategy Description of the corrective action Completion date Status
    Training
    SBA provided training at lender conferences in order to provide lenders an understanding of the most common root causes of the improper payments. SBA recently updated its loan making Standard Operating Procedure (SOP) and provided training to Lenders. SBA provides regular feedback to Loan Center management and staff regarding Improper Payments, Root Causes, and Corrective Actions. Quality Control and Quality Assurance staff for 9 of SBA's 10 reporting programs meet regularly to discuss improper payment related issues that may be common to all teams.
    FY2023 Q4
    Completed
    Training
    SBA plans to continue its staff training in order to provide staff an understanding of the most common root causes of the improper payments. SBA will also provide training to staff and lenders on the new requirements in its Standard Operating Procedures. SBA will continue to provide regular feedback to Loan Center management and staff regarding Improper Payments, Root Causes, and Corrective Actions. SBA will also continue to have Quality Control and Quality Assurance staff meet regularly to discuss issues common to all.
    FY2024
    Planned

Overpayments

7(a) Loan Guaranty Purchases describes the loan guaranty purchase process. A lender may demand that SBA honor its guaranty on a loan if a borrower is in default or files for federal bankruptcy protection. During the loan guaranty purchase process, the SBA will purchase (also called “honor”) the guaranty on a defaulted SBA loan. The 7(a) Loan Guaranty Purchase reviews were conducted to determine whether lenders complied materially with the 7(a) loan program origination requirements, including statutory provisions, SBA regulations, any agreement the lender executed with the SBA, standard operating procedures, loan authorizations, and official SBA notices and forms applicable to the 7(a) loan program. Improper payments generally arose when SBA's purchase processors failed to identify lenders’ deficiencies during the evaluating, processing, closing, disbursing, servicing, liquidating, or litigating of an SBA guaranteed loan.
Overpayment root cause Overpayment amount
Amount of overpayments within the agency's control $37.75 M
Amount of overpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of overpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of overpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $37.75 M

Overpayment root cause Overpayment amount
Amount of overpayments outside the agency's control $0 M

Overpayment type Eligibility element/information needed Eligibility amount
Overpayments Within Agency Control Financial $37.75 M

Overpayment type Mitigation strategies taken Mitigation strategies planned
Overpayments within the agency’s control Training Training

Underpayments

Underpayment root cause Underpayment amount
Amount of underpayments $11.06 M
The amount of underpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of underpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of underpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $11.06 M

Eligibility element/information needed Eligibility amount
Financial $11.06 M

Mitigation strategies taken Mitigation strategies planned
Training Training

Technically improper payments

The amount of improper payments that were paid to the right recipient for the correct amount but were considered technically improper because of failure to follow statute or regulation $0.0 M

Additional information

$11.06 M

Unknown Payment Details

Evaluation of corrective actions

To reduce and/or eliminate the occurrence of future improper payments, a Corrective Action Plan has been developed for the7(a) Loan Guaranty Purchase program centers. Specific corrective actions are determined based upon the primary reason for the error with the purpose of both remedying the error and preventing recurrence.

Plans for improvement include the following:
• Collaborating with the oversight office to inform the office of specific lender deficiencies for further monitoring and potential incorporation into Risk Based Reviews;
• Collaborating with the policy office to inform the office of deficiencies identified for potential incorporation into policy, regulatory, or standard operating procedure rewrite or update; and,
• Training for staff on policy requirements governing eligibility, and appropriate loan structure.
SBA anticipates that training and internal collaboration will continue to be effective.

Future payment integrity outlook

7(a) Loan Guarantees Purchases has established a baseline.

SBA anticipates that corrective actions--training and collaboration--will serve to lower the improper payment rate in the coming year.

Out-Year improper payment and unknown payment projections and target
Current year +1 estimated future outlays $922.45 M
Current year +1 estimated future improper payments $55.81 M
Current year +1 estimated future unknown payments $0 M
Current year +1 estimated future improper payment and unknown payment rate 6.05 %
Current year +1 estimated future improper payment and unknown payment reduction target 6.05 %

The program's current year improper payment and unknown payment rate of 6.15 % may or may not be the tolerable rate. The agency has not yet determined the tolerable rate for this program.

SBA anticipates establishing a Tolerable Rate for this program in the near future.

The agency has what is needed with respect to internal controls, human capital and information system and other infrastructure to reduce Improper Payments and Unknown Payments.

No additional resources for this program were requested.

Additional programmatic information

  • FY 2024 improper payment estimates

    Chart legend and breakdown

    Payment accuracy rate

    Improper payment rate

    Unknown payment rate


    Sampling & estimation methodology details

    Sampling timeframe:

    04/2023 - 03/2024


    Confidence interval:

    95% to <100%


    Margin of error:

    +/-2.51

  • Actions taken & planned to mitigate improper payments

    Mitigation strategy Description of the corrective action Completion date Status
    Training
    Internal training for purchase processors, reviewers, and approvers includes information to determine proper recommendation of guaranty purchase or denial: ensuring that borrower and loan eligibility requirements are met; ensuring that liquidation expenses are appropriate and/or approved, verifying the documentation and accuracy of calculations, ensuring that documentation for account reconciliation is complete, and verifying the proper use of proceeds and reviewing expenses for eligibility of reimbursement. Training is an ongoing process.
    The corrective action was not fully completed this reporting period
    Not Completed
    Training
    At this writing, SBA is in the process of issuing additional revisions to the 7(a) Servicing and Liquidation SOP. SBA plans to provide training to staff and lenders on the revised SOP. SBA will also provide internal training for purchase processors, reviewers, and approvers to determine proper recommendation of guaranty purchase or denial: ensuring that borrower and loan eligibility requirements are met; ensuring that liquidation expenses are appropriate and/or approved, verifying the documentation and accuracy of calculations, ensuring that documentation for account reconciliation is complete, and verifying the proper use of proceeds and reviewing expenses for eligibility of reimbursement.
    FY2025
    Planned

Overpayments

7(a) Loan Guaranty Purchase reviews are conducted to determine whether lenders complied materially with the 7(a) loan program origination requirements, including statutory provisions, SBA regulations, any agreement the lender executed with the SBA, standard operating procedures, loan authorizations, and official SBA notices and forms applicable to the 7(a) loan program. The reviewers determined whether the lender (1) originated, serviced, and liquidated the loan in a prudent and commercially reasonable manner, (2) misrepresented or failed to disclose a material fact to the SBA, and/or (3) put the SBA’s financial interest at risk. Loans in the 7(a) Loan Guaranty Purchase Program are reviewed at the time of guaranty purchase, after SBA has honored its guaranty.
Overpayment root cause Overpayment amount
Amount of overpayments within the agency's control $64.79 M
Amount of overpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of overpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of overpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $64.79 M

Overpayment root cause Overpayment amount
Amount of overpayments outside the agency's control $0.0 M

Overpayment type Eligibility element/information needed Eligibility amount
Overpayments Within Agency Control Financial $64.79 M

Overpayment type Mitigation strategies taken Mitigation strategies planned
Overpayments within the agency’s control Training Training

Underpayments

Underpayment root cause Underpayment amount
Amount of underpayments $9.74 M
The amount of underpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of underpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of underpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $9.74 M

Eligibility element/information needed Eligibility amount
Financial $9.74 M

Mitigation strategies taken Mitigation strategies planned
Training Training

Technically improper payments

The amount of improper payments that were paid to the right recipient for the correct amount but were considered technically improper because of failure to follow statute or regulation $0.0 M

Additional information

$9.74 M

Unknown Payment Details

Evaluation of corrective actions

. The Corrective Action Plan includes:
• Internal training for purchase processors, reviewers, and approvers to determine proper recommendation of guaranty purchase or denial: ensuring that borrower and loan eligibility requirements are met; ensuring that liquidation expenses are appropriate and/or approved, verifying the documentation and accuracy of calculations, ensuring that documentation for account reconciliation is complete, and verifying the proper use of proceeds and reviewing expenses for eligibility of reimbursement.
• Internal feedback was provided to center staff regarding the specific loan-level deficiency upon detection.

To reduce and/or eliminate the occurrence of future improper payments, a Corrective Action Plan has been developed for the 7(a) Loan Guaranty Purchase Centers. Specific corrective actions are determined based upon the primary reason for the error to prevent recurrence of improper payments

The root cause for 7(a) Loan Guaranty Purchases improper payments was identified as Failure to Access Data/ Information when Improper payments when purchase processors failed to identify lenders’ deficiencies during the evaluating, processing, closing, disbursing, servicing, liquidating, or litigating of an SBA guaranteed loan.

Internal training in these areas will focus on the causes of improper payments.

Corrective actions are tracked at the loan level through a centralized database. The Quality Control Specialists for the 7(a) Loan Guaranty Purchase centers monitor errors from identification through completion of the corrective action. Headquarters management provides oversight to ensure that milestones are met. Improper payments identified as a result of the FY 2024 PIIA reviews have been resolved through obtaining additional documentation, referral for denial review, collection of funds from the lender, or reimbursement to the lender.

Future payment integrity outlook

7(a) Loan Guarantees Purchases has established a baseline.

The FY 2025 Reduction Targets established for 7(a) Loan Guaranty Purchases is the lesser of the established tolerable rate, or the current reported improper payment rate (i.e., if the FY 2024 improper payment rate is less than the established tolerable rate, the FY 2024 improper payment rate will be the reduction target).

Out-Year improper payment and unknown payment projections and target
Current year +1 estimated future outlays $965.09 M
Current year +1 estimated future improper payments $51.54 M
Current year +1 estimated future unknown payments $0 M
Current year +1 estimated future improper payment and unknown payment rate 5.34 %
Current year +1 estimated future improper payment and unknown payment reduction target 5.34 %

The program's current year improper payment and unknown payment rate of 5.34 % has been achieved with a balance of payment integrity risk and controls and represents the lowest rate that can be achieved without disproportionally increasing another risk, therefore it is the tolerable rate.

Management established this tolerable rate range mindful of the extent to which applying further payment controls would undercut the program’s mission or resource management.

The agency has what is needed with respect to internal controls, human capital and information system and other infrastructure to reduce improper payments and unknown payments to the tolerable rate.

No additional resources were requested in the most recent budget submission of the agency to establish and maintain payment integrity.

Additional programmatic information

The 7(a) Loan program is the SBA’s most common loan program. The 7(a) Loan program provides small businesses with short- and long-term working capital, capital to refinance current business debt, and capital for specific business expenditures. Key eligibility factors are based on what the business does to receive its income, its credit history, and where the business operates.

For payment integrity reporting, the 7(a) Loan program is bifurcated into 7(a) Loan Guaranty Approvals and 7(a) Loan Guaranty Purchases.
7(a) Loan Guaranty Purchases describes the loan guaranty purchase process. A lender may demand that the SBA honor its guaranty on a loan if a borrower is in default or files for federal bankruptcy protection. During the loan guaranty purchase process, the SBA will purchase (also called “honor”) the guaranty on a defaulted SBA loan.

During the loan guaranty purchase review process, the SBA reviews the 7(a) loan guaranty purchase to determine that the honoring of the guaranty was done appropriately: that the lender complied materially with Loan Program Requirements as defined in 13 CFR 120.110; that the lender made, closed, serviced, and liquidated the loan in a prudent manner; that the lender’s improper action or inaction did not place SBA at risk; that the lender did not misrepresent or fail to disclose a material fact regarding the loan.

Accountability for detecting, preventing, and recovering improper payments

Review standards are established as part of the agency's annual appraisal process. These standards hold managers accountable for meeting applicable reduction targets, preventing improper payments, and promptly detecting and recovering overpayments.

  • FY 2025 improper payment estimates

    Chart legend and breakdown

    Payment accuracy rate

    Improper payment rate

    Unknown payment rate


    Sampling & estimation methodology details

    Sampling timeframe:

    04/2024 - 03/2025


    Confidence interval:

    95% to <100%


    Margin of error:

    +/-3.0

Causes

The root cause was identified as Failure to Access Data/ Information. Improper payments occurred when purchase processors failed to identify lenders’ deficiencies during the evaluating, processing, closing, disbursing, servicing, liquidating, or litigating of an SBA guaranteed loan. The root cause was identified as Statutory Requirements of Program Were Not Met when the source of equity injection funds was not provided.
The primary reasons for 7(a) Loan Guaranty Purchase improper payments included improper payment of expenses related to the care and preservation of collateral, failing to properly identify eligibility for debt refinance, and failing to adequately reconcile the purchase from the Secondary Market.

Overpayment root cause Overpayment amount
Amount of overpayments within the agency's control $17.13 M
Amount of overpayments outside the agency's control $0.0 M
Amount of overpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
Amount of overpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
Amount of overpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $17.13 M

Underpayment root cause Underpayment amount
Amount of underpayments $5.42 M
The amount of underpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of underpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of underpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $5.42 M

The amount of improper payments that were paid to the right recipient for the correct amount but were considered technically improper because of failure to follow statute or regulation $0.0 M

The amount that could either be proper or improper but the agency is unable to determine whether it was proper or improper as a result of insufficient or lack of documentation $9.31 M

Prevention

Internal training for purchase processors, reviewers, and approvers to determine proper recommendation of guaranty purchase or denial: ensuring that borrower and loan eligibility requirements are met; ensuring that liquidation expenses are appropriate and/or approved, verifying the documentation and accuracy of calculations, ensuring that documentation for account reconciliation is complete, and verifying the proper use of proceeds and reviewing expenses for eligibility of reimbursement. Internal feedback provided to center staff regarding the specific loan-level deficiency upon detection. Corrective actions were generally completed at the loan level within 60 days, and all actions were taken by the end of the fiscal year.
The agency’s corrective action plan focuses on ensuring that deficiencies leading to Improper Payments and Unknown Payments are identified, corrected, and prevented. OFPO recently updated the 7(a) Guaranty Purchase SOP and has updated and published all related job aids and resources. As of the date of this submission, lender, internal, and external training on the new policy requirements is underway, with additional targeted training planned based on the findings identified through PIIA reviews. OFPO provides feedback to lenders and employees, obtains additional documentation from lenders when necessary, and will recapture funds when improper payments are confirmed. Significant lender-level deficiencies—based on severity or recurring patterns—are shared with the Office of Credit Risk Management (OCRM) for consideration in its risk-based review process and with the Office of Financial Assistance (OFA) to support policy refinement. These corrective actions together ensure that the agency’s response is proportional to the underlying root causes and supports measurable reductions in Improper Payments and Unknown Payments.

Corrective Actions are structured based on the Root Cause of the Improper Payment. Specific corrective actions are determined based upon the primary reason for the error to prevent recurrence of improper payments. Root causes are shared with management through review cycle. Corrective Actions, such as External training is formulated to address root causes of improper payments. Corrective actions are tracked at the loan level through a centralized database.

Payment type Mitigation strategies taken Mitigation strategies planned
Overpayments Audit, Change Process, Training Audit, Change Process, Training
Underpayments Audit, Change Process, Training Audit, Change Process, Training
Unknown payments Training Audit,Change Process,Training

Eligibility element/information needed Description of the eligbility element/information
Financial The financial position or status of a beneficiary, recipient, or their family

Additional information

Reduction target

1.07 %

The agency has internal control, human capital and information system and other infrastructure to reduce improper payments and unknown payment.

In the most recent budget submission, the agency requested to maintain current resources to support workforce capacity and operational activities required to ensure payment integrity of the 7(a) Guaranty Purchase Process during testing, recoupment, and closeout. These resources are intended to support staff responsible for post-guaranty purchase reviews, improper payment identification, recovery efforts, and closeout activities. Despite overall resource constraints in fiscal year 2025, the program prioritized available staffing and funding to sustain payment integrity functions and ensure compliance through the recoupment and closeout phase.

As a means to reduce and/or eliminate the occurrence of improper payments, a Corrective Action Plan has been developed for the program. In addition, managers are held accountable for meeting the program's improper payment rate and unknown payment rate reductions targets. These targets are incorporated into managers' annual performance appraisal goals. Senior management provides oversight to ensure program milestones are met. Senior management is responsible for maintaining sufficient internal controls to prevent improper payments and developing the Quality Control/Improvement Program to determine whether the loan is proper or improper payment. In addition, senior management has established and maintained sufficient and appropriate control environment.

$5.42 M