On Friday, Dec. 5, the U.S. Small Business Administration (SBA) sent letters to all 4,300 8(a) Business Development Program (8(a) Program) participants requiring production of detailed financial records for the last three years. Contractors must comply with the SBA’s request by Jan. 5, 2026. Noncompliance may lead to loss of 8(a) Program certification, further investigation and remedial actions.
The records to be produced include, but are not limited to:
- Financial statements
- Bank statements
- General ledgers
- Payroll registers
- Contracting and subcontracting agreements
- Employee lists
The 8(a) Program was established to create growth opportunities for socially and economically disadvantaged small businesses. In July 2025 SBA Administrator Kelly Loeffler ordered a full audit of the 8(a) Program after a Department of Justice investigation uncovered a $550 million fraud and bribery scheme and amidst growing media reports of misconduct within the 8(a) Program. The requirement that all 8(a) Program participants produce financial records is touted by the SBA as its next effort to address fraud, waste and abuse.
Federal contractors who are participants in the 8(a) Program should immediately take the following actions:
- Acknowledge receipt of the letter or email from SBA.
- Check spam folders to ensure the request was not misdirected.
- Read the letter carefully to understand each request.
- Conduct an internal audit of all records before submitting them to the SBA.
- Assess and ensure regulatory compliance with 8(a) Program requirements.
Our Aerospace, Defense and Government Services industry group is here to assist companies with these SBA requests. Please reach out to Aida Dismondy, Adam Bruski, Mike Stone or your Warner attorney.
