Small Business Lending Fraud Prevention Act
Summary
The Small Business Lending Fraud Prevention Act aims to prevent conflicts of interest within the Small Business Administration (SBA) concerning loan origination, review, and approval. It mandates SBA employees to certify they have no prohibited conflicts of interest related to the loans they handle. The bill also requires employees to disclose any conflicts that arise after the initial certification and recuse themselves from further participation in the loan process.
Expected Effects
This act will likely increase transparency and accountability within the SBA's lending processes. It will require the SBA Administrator to issue regulations implementing the act within 180 days of enactment. The certification requirement will begin 270 days after enactment.
Potential Benefits
- Increased transparency in SBA lending.
- Reduced potential for fraud and misuse of funds.
- Greater public trust in the SBA.
- Enhanced accountability for SBA employees.
- Strengthened ethical standards within the SBA.
Potential Disadvantages
- Potential for increased administrative burden on SBA employees.
- Possible delays in loan processing due to certification and recusal requirements.
- May not completely eliminate all conflicts of interest, as it relies on self-reporting.
- Costs associated with implementing and enforcing the new regulations.
- Potential for employees to avoid participation in loan processes to avoid certification.
Constitutional Alignment
The bill aligns with the Constitution's aim to promote the general welfare (Preamble). Congress has the power to legislate in areas related to interstate commerce and to oversee the operations of government agencies. Article 1, Section 8, Clause 1 grants Congress the power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).