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 assistance from the Small Business Administration (SBA). The bill amends Section 16 of the Small Business Act to prohibit financial assistance to associates of small businesses who have been convicted of financial misconduct related to covered loans or grants. This prohibition extends to the small business concerns themselves if they have such an associate.
Expected Effects
The bill will likely reduce fraud within SBA programs by creating a disincentive for financial misconduct. It will also ensure that government funds intended for legitimate small businesses are not misused. This could lead to a more efficient allocation of resources and greater public trust in the SBA.
Potential Benefits
- Reduces the risk of fraudulent activities within SBA programs.
- Ensures that financial assistance reaches legitimate small businesses.
- Enhances public trust in government spending and SBA operations.
- Promotes responsible financial behavior among small business owners and associates.
- Potentially frees up resources for other deserving businesses.
Potential Disadvantages
- May inadvertently penalize businesses with unknowingly compromised associates.
- Could create additional administrative burden for the SBA to verify compliance.
- May disproportionately affect certain communities if fraud convictions are concentrated in specific areas.
- The definition of "associate" could be overly broad, capturing individuals with limited influence.
- The exception for Section 7(b) loans might create a loophole.
Constitutional Alignment
The bill appears to align with the Constitution's general welfare clause (Preamble). Congress has the power to enact laws that promote responsible use of taxpayer money. The bill 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).