I 

118TH CONGRESS 

1ST SESSION H. R. 5427 

To prohibit individuals convicted of defrauding the Government from receiving 

any assistance from the Small Business Administration, and for other 

purposes. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 13, 2023 

Mr. WILLIAMS of Texas (for himself, Mr. MFUME, and Mr. BEAN of Florida) 

introduced the following bill; which was referred to the Committee on 

Small Business 

A BILL 

To prohibit individuals convicted of defrauding the Government from receiving any assistance from the Small Business Administration, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. ASSISTANCE PROHIBITED AFTER FRAUD CON4 VICTION. 

5 (a) IN GENERAL.—Section 16 of the Small Business 

6 Act (15 U.S.C. 645) is amended by adding at the end the 

7 following new subsection: 

8 ‘‘(h) FINANCIAL ASSISTANCE PROHIBITION.— 


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1 ‘‘(1) IN GENERAL.—An associate of a small 

2 business concern who is finally convicted of any 

3 crime involving or relating to financial misconduct or 

4 a false statement with respect to a covered loan or 

5 grant shall be ineligible to receive any financial as6 sistance from the Administrator, other than financial 

7 assistance under section 7(b). 

8 ‘‘(2) BUSINESS CONCERNS.—A small business 

9 concern that has as an associate an individual sub10 ject to paragraph (1) shall be ineligible to receive 

11 any financial assistance from the Administrator, 

12 other than financial assistance under section 7(b). 

13 ‘‘(3) DEFINITIONS.—In this subsection: 

14 ‘‘(A) ASSOCIATE.—The term ‘associate’ 

15 means, with respect to a small business con16 cern— 

17 ‘‘(i) an officer, director, or owner of 

18 more than 20 percent of the equity of, or 

19 a key employee of, such small business 

20 concern; 

21 ‘‘(ii) any entity not less than 20 per22 cent owned or controlled by one or more 

23 individuals referred to in clause (i); and 

24 ‘‘(iii) any other individual or entity in 

25 control of or controlled by such small busiVerDate Sep 11 2014 18:12 Sep 16, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H5427.IH H5427

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1 ness concern, except for a licensed small 

2 business investment company (as defined 

3 in section 103(3) of the Small Business In4 vestment Act of 1958 (15 U.S.C. 662(3)). 

5 ‘‘(B) COVERED LOAN OR GRANT.—The 

6 term ‘covered loan or grant’ means— 

7 ‘‘(i) a loan made under— 

8 ‘‘(I) paragraph (36) or (37) of 

9 subsection (a) of section 7 of the 

10 Small Business Act (15 U.S.C. 636); 

11 or 

12 ‘‘(II) subsection (b) of such sec13 tion in response to the COVID–19 

14 pandemic; or 

15 ‘‘(ii) a grant made under— 

16 ‘‘(I) section 5003 of the Amer17 ican Rescue Plan Act of 2021 (15 

18 U.S.C. 9009c); or 

19 ‘‘(II) section 324 of the Eco20 nomic Aid to Hard-Hit Small Busi21 nesses, Nonprofits, and Venues Act 

22 (15 U.S.C. 9009a). 

23 ‘‘(C) FINALLY CONVICTED.—The term ‘fi24 nally convicted’ means, with respect to an indi25 vidual or entity, that such individual or entity 


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1 has been convicted of an offense and such con2 viction— 

3 ‘‘(i) has not been appealed and is no 

4 longer appealable because the time for tak5 ing an appeal has expired; or 

6 ‘‘(ii) has been appealed and the ap7 peals process for such conviction is com8 pleted.’’. 

9 (b) APPLICABILITY.—Subsection (h) of section 16 of 

10 the Small Business Act (15 U.S.C. 645), as added by sub11 section (a) of this Act, shall not apply to any contract or 

12 other agreement entered into by the Government prior to 

13 the date of the enactment of this Act. 

Æ 


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