The HEALS Act is attempting to breathe new life into the American economy and fuel the country’s post-pandemic rebound by providing another round of small-business aid. But unless it addresses an issue that was present in its Payroll Protection Program predecessor, the HEALS Act could usher in an onslaught of additional fraud.

Some of the fraud seen during the PPP rollout was the result of individuals inflating the size of payroll to obtain larger loan amounts, deflating employee counts to qualify as a small business and fabricating reports of employees and salaries that never existed. In the first fraud incident, two men tried to get more than $500,000 to support fake employees. Most recently, a Florida man obtained $3.9 million and used it to purchase a Lamborghini.

Other preventable fraud cases were, to the surprise of many, instigated by known criminals. As the Small Business Administration did not require lenders to verify applicants’ self-certified criminal history, hundreds of millions of dollars were stolen from law-abiding individuals who dared to pursue their American Dream — individuals for whom PPP loans aren’t just dollars and cents, but a lifeline.

For those that truly deserve the HEALS Act’s newly introduced relief, the first thing the SBA must do is require lenders to independently verify criminal records for HEALS Act applicants. Granted, this isn’t easy, and explains why the SBA likely steered away from this requirement in the first place: Background checks are expensive, FBI databases require fingerprints and public criminal databases are fraught with inaccurate and incomplete data that make them unactionable....

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