Aaron Sibarium writes for the Washington Free Beacon about a disturbing new federal government audit.
An Inspector General audit of the Minority Business Development Agency’s flagship program found that 96 percent of the reviewed transactions should not have been approved, revealing a stunning lack of oversight at the now-defunct agency and raising questions about what will happen if Democrats revive the program.
The November 2025 audit, which has not been previously reported, reviewed $16 billion in transactions approved by the MBDA business center program, a network of federally funded consultancies, public and private, aimed at supporting minority-owned businesses, which had to be at least 51 percent minority-owned to qualify for services. The audit found that $15.4 billion of the $16 billion in transactions reviewed were “duplicate transactions, transactions with missing or inadequate documentation, and transactions that MBDA should not have approved based on the underlying activity.” In one case, a business obtained a $33 million contract through the program without providing any paperwork.
“I cannot recall seeing anything at this level of improper or inappropriate payments,” said Judge Glock, the director of research at the Manhattan Institute, who studies waste and fraud in government programs. “Over 90 percent is fairly wild for a major program.”
President Donald Trump issued an executive order in March 2025 attempting to eliminate the agency, though a federal court stepped in to block that move. In response, the administration fired all remaining employees at the agency in October 2025. The Trump administration’s actions followed the ruling of a federal judge in March 2024 that the operating theory of the agency—that certain racial and ethnic groups are presumptively disadvantaged—was unconstitutional and that the agency could not use race or ethnicity to dole out money.
The 2025 audit, which began under the Biden administration, looked at just 10 of the 40 business centers funded by the agency before it was gutted by the Trump administration in 2025. And it only chose centers with a history of bookkeeping problems, meaning the audit’s findings can’t be extrapolated to the program as a whole.
