S.1047 - Assisting Small Businesses Not Fraudsters Act (119th Congress)
Summary
S.1047, 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). The bill amends Section 16 of the Small Business Act to prohibit SBA assistance to those convicted of financial misconduct related to covered loans or grants. This includes associates of small businesses who have been convicted of such crimes.
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. However, it might also create additional administrative burdens for the SBA to verify the backgrounds of loan applicants and their associates.
Potential Benefits
- Reduced fraud in SBA lending programs.
- Increased public trust in government spending.
- Fairer distribution of SBA resources to legitimate businesses.
- Discourages financial misconduct related to government assistance.
- Potentially strengthens the integrity of the SBA.
Potential Disadvantages
- Increased administrative burden for the SBA to conduct background checks.
- Potential for delayed loan processing times.
- Risk of inadvertently penalizing businesses due to overly broad definitions of "associate".
- May not deter sophisticated fraudsters who can conceal their involvement.
- Could disproportionately affect marginalized communities if background checks are not implemented fairly.
Constitutional Alignment
The bill appears to align with the Constitution's general welfare clause (Preamble). Congress has the power to regulate commerce and provide for the general welfare, which includes preventing fraud in government programs. The bill does not appear to infringe on any specific constitutional rights, such as freedom of speech or due process, as it only restricts access to government assistance after a conviction.
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).