WASHINGTON — Today, the U.S. Small Business Administration (SBA) initiated termination proceedings to remove 628 firms from the 8(a) Business Development Program after they refused to comply with SBA’s order to turn over three years’ worth of financial documents for review. Last year, the SBA requested basic documents from all 4,300 8(a) contractors as part of the agency’s ongoing effort to root out DEI and small business pass-through contracting abuse that proliferated across the federal government during the Biden Administration.

“After decades without oversight and amid the Biden-era DEI agenda, the 8(a) federal contracting program became rife with so-called ‘socially and economically disadvantaged’ firms who abused sole-source and set-aside contracts to enrich themselves with pass-through schemes,” said SBA Administrator Kelly Loeffler. “Last year, we required those contractors to show us their books – and today, we’re beginning the process of terminating over 620 firms who refused to comply. The message is clear: if you have something to hide, you cannot do business with the federal government. We are ending abuse and DEI discrimination in federal contracting and removing every fraudulent participant that took opportunity away from legitimate and eligible small business owners at taxpayers’ expense. Our audit continues and will have more results to report, including potential investigations.”

The 628 8(a) firms SBA is moving to terminate today are among the 1,091 that were initially suspended last month for refusal to comply with the agency’s document request. Collectively, these firms received nearly $850 million in 8(a) contracts during the Biden Administration from Fiscal Year 2021 to 2024, including $637 million in 8(a) set-aside contracts.

Since the beginning of the Administration, the Trump SBA has worked to end discrimination and crack down on fraud within the 8(a) Program for “socially and economically disadvantaged” small businesses, which dramatically expanded during the Biden Administration as a vehicle for DEI favoritism in the federal contracting marketplace. Following last month’s actionmoving to terminate 154 8(a) firms in the Washington, D.C. area, the SBA has now initiated termination proceedings against nearly 800 firms, or about 20% of the total 8(a) Program participants.

Under Administrator Loeffler’s leadership, the SBA is working to restore integrity to the federal contracting marketplace. On Day One, the agency reduced the “Small Disadvantaged Business” contracting goal for the federal government from 15% to its statutory 5%. The Trump SBA also ended the practice of accepting firms into the 8(a) Program based solely on unsubstantiated claims and Biden-era narratives of racial discrimination. Additionally, the agency has also taken unprecedented action to crack down on fraud and abuse – launching the first audit of the 8(a) Program in its nearly 50-year history and issuing numerous suspensions and termination notices to noncompliant contractors.

The Trump SBA has taken the following actions to end DEI discrimination within the 8(a) Program and crack down on fraud and abuse:

• In February 2025, on the first day of Administrator Loeffler’s term, the Trump SBA cut the Small Disadvantaged Business contracting goal back to its statutory 5% and ended the practice of approving firms based solely on unsubstantiated claims of racial discrimination.
• In June 2025, SBA launched the first-ever audit of the 8(a) Program in its nearly 50-year history – initiating an investigation into all high-dollar and limited-competition contracts going back over a period of fifteen years.
• In July 2025, the agency rescinded the independent 8(a) contracting authority of the U.S. Agency for International Development (USAID) after a DOJ investigation uncovered a $550 million bribery scheme involving several 8(a) contractors.
• That same month, SBA issued a letter of warning to all federal contracting officers, outlining the penalties for failing to report suspected fraud, waste, and abuse within the 8(a) Program.
• In October 2025, SBA suspended numerous 8(a) contractors following allegations of fraud involving more than $253 million in previously issued contract awards.
• In November 2025, SBA cleared the Biden-era backlog of 2,700 Veteran Small Business Certification (VetCert) applications, which accumulated after the prior Administration diverted all resources away from VetCert to increase certification approvals for the 8(a) Program.
• In December 2025, SBA ordered all 4,300 8(a) contractors to produce three years’ worth of financial documents for review by the agency in the effort to root out pass-through abuse and fraud by shell companies.