Ban Fraudsters from Small Business Aid

Official: Assisting Small Businesses Not Fraudsters Act

IntroducedJanuary 28, 2025

CommerceGovernment lending and loan guaranteesCriminal investigation, prosecution, interrogationFraud offenses and financial crimesSmall businessCredit and credit markets

Why This Matters

This bill stops anyone convicted of defrauding the government from getting financial help from the Small Business Administration. It also makes small businesses with such individuals in key positions ineligible for this assistance.

If you own a small business, having someone with a fraud conviction in a key role could prevent you from accessing vital financial support.

Affects: Small business owners and employees who have been convicted of fraud against the government.

Summary

Assisting Small Businesses Not Fraudsters Act This bill prohibits individuals convicted of certain financial crimes from receiving assistance from the Small Business Administration (SBA). Specifically, the bill prohibits individuals who have been convicted of a crime involving financial misconduct or a false statement with respect to certain COVID-19 loans (e. g., Paycheck Protection Program loans, Restaurant Revitalization Fund grants, and Shuttered Venue Operators grants) from receiving any financial assistance from the SBA (other than a disaster loan). The prohibition includes SBA assistance to small businesses that have an owner, officer, director, or key employee who has been convicted of such a crime.

What changes is this bill making?

1. Individuals convicted of financial misconduct or false statements related to loans or grants cannot receive any financial assistance from the Small Business Administration. 2. Small businesses with associates who have been convicted of fraud are also ineligible for financial assistance, except for specific types of aid. 3. The bill defines 'associate' to include officers, directors, and key employees owning more than 20% of the business. 4. The prohibition applies to loans and grants related to COVID-19 relief and other specific programs. 5. The law does not affect contracts or agreements made by the government before this bill is enacted.