H.R.825 - Assisting Small Businesses Not Fraudsters Act (119th Congress)
Summary
H.R.825, the "Assisting Small Businesses Not Fraudsters Act," aims to prevent individuals convicted of defrauding the government from receiving financial assistance from the Small Business Administration (SBA). It amends the Small Business Act to prohibit SBA assistance to associates of small businesses who have been convicted of financial misconduct related to covered loans or grants. The bill defines key terms like "associate" and "covered loan or grant" to clarify the scope of the prohibition.
Expected Effects
The Act will likely reduce fraud within SBA programs by creating a disincentive for financial misconduct. It will also ensure that government funds are not awarded to individuals or businesses with a proven history of defrauding the government. This could lead to a more efficient allocation of resources within the SBA.
Potential Benefits
- Reduces fraud and misuse of SBA funds.
- Protects taxpayer money by preventing convicted fraudsters from receiving government assistance.
- Promotes integrity and accountability in SBA programs.
- May encourage more responsible behavior among small business owners and their associates.
- Could lead to a more equitable distribution of SBA resources to deserving businesses.
Potential Disadvantages
- May disproportionately affect individuals who have already served their time for past offenses.
- Could create additional administrative burden for the SBA to verify the backgrounds of applicants.
- The definition of "associate" might be overly broad, potentially impacting legitimate businesses.
- May not be effective in preventing sophisticated fraud schemes.
- Could potentially discourage investment in small businesses by individuals with past financial misconduct convictions.
Constitutional Alignment
The Act appears to align with the Constitution's general welfare clause (Preamble). Congress has the power to enact laws that promote the general welfare, including preventing fraud and ensuring responsible use of taxpayer funds. The Act does not appear to infringe on any specific constitutional rights, such as freedom of speech or due process, as it applies only after a conviction has been obtained through due process.
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).