IIB 
118TH CONGRESS 
1ST SESSION H. R. 5427 
IN THE SENATE OF THE UNITED STATES 
NOVEMBER 29, 2023 
Received; read twice and referred to the Committee on Small Business and 
Entrepreneurship 
AN ACT 
To prohibit individuals convicted of defrauding the Govern-
ment from receiving any assistance from the Small Busi-
ness Administration, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
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SECTION 1. ASSISTANCE PROHIBITED AFTER FRAUD CON-
VICTION. 
(a) IN GENERAL.—Section 16 of the Small Business 
Act (15 U.S.C. 645) is amended by adding at the end the 
following new subsection: 
‘‘(h) FINANCIAL ASSISTANCE PROHIBITION.— 
‘‘(1) IN
GENERAL.—An associate of a small 
business concern who is finally convicted of any 
crime involving or relating to financial misconduct or 
a false statement with respect to a covered loan or 
grant shall be ineligible to receive any financial as-
sistance from the Administrator, other than financial 
assistance under section 7(b). 
‘‘(2) BUSINESS CONCERNS.—A small business 
concern that has as an associate an individual sub-
ject to paragraph (1) shall be ineligible to receive 
any financial assistance from the Administrator, 
other than financial assistance under section 7(b). 
‘‘(3) DEFINITIONS.—In this subsection: 
‘‘(A) ASSOCIATE.—The term ‘associate’ 
means, with respect to a small business con-
cern— 
‘‘(i) an officer, director, or owner of 
more than 20 percent of the equity of, or 
a key employee of, such small business 
concern; 
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‘‘(ii) any entity not less than 20 per-
cent owned or controlled by one or more 
individuals referred to in clause (i); and 
‘‘(iii) any other individual or entity in 
control of or controlled by such small busi-
ness concern, except for a licensed small 
business investment company (as defined 
in section 103(3) of the Small Business In-
vestment Act of 1958 (15 U.S.C. 662(3)). 
‘‘(B) COVERED
LOAN
OR
GRANT.—The 
term ‘covered loan or grant’ means— 
‘‘(i) a loan made under— 
‘‘(I) paragraph (36) or (37) of 
subsection (a) of section 7 of the 
Small Business Act (15 U.S.C. 636); 
or 
‘‘(II) subsection (b) of such sec-
tion in response to the COVID–19 
pandemic; or 
‘‘(ii) a grant made under— 
‘‘(I) section 5003 of the Amer-
ican Rescue Plan Act of 2021 (15 
U.S.C. 9009c); or 
‘‘(II) section 324 of the Eco-
nomic Aid to Hard-Hit Small Busi-
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nesses, Nonprofits, and Venues Act 
(15 U.S.C. 9009a). 
‘‘(C) FINALLY CONVICTED.—The term ‘fi-
nally convicted’ means, with respect to an indi-
vidual or entity, that such individual or entity 
has been convicted of an offense and such con-
viction— 
‘‘(i) has not been appealed and is no 
longer appealable because the time for tak-
ing an appeal has expired; or 
‘‘(ii) has been appealed and the ap-
peals process for such conviction is com-
pleted.’’. 
(b) APPLICABILITY.—Subsection (h) of section 16 of 
the Small Business Act (15 U.S.C. 645), as added by sub-
section (a) of this Act, shall not apply to any contract or 
other agreement entered into by the Government prior to 
the date of the enactment of this Act. 
Passed the House of Representatives November 28, 
2023. 
Attest: 
KEVIN F. MCCUMBER, 
Clerk. 
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