Small Business Lending Fraud Prevention Act

H.R. 7401, the Small Business Lending Fraud Prevention Act, would establish new ethics requirements for Small Business Administration employees involved in loan origination, review, and approval. Specifically, the bill would require SBA employees to certify in writing that they have no conflicts of interest prohibited under federal law before personally and substantially participating in any loan decisions. This certification requirement would take effect 270 days after the bill becomes law. The bill has passed committee review and is eligible for a floor vote in the House. If enacted, this measure would aim to strengthen transparency and accountability in how the SBA administers its lending programs by ensuring that employees making loan decisions do not have financial or personal interests that could influence their decisions. The practical effect would be to add an additional layer of ethics oversight to SBA loan processing.