QUESTION: What is meant by the references to "Sex Offender" in the GAO document "SMALL BUSINESS LENDING: Opportunities Exist to Improve Performance Reporting of Treasury’s Programs" released Dec 2012? Page-10 of this document says:
As mandated by the act, Treasury requires each SBLF participant to submit two annual certifications:(1) Any businesses receiving a loan from an SBLF participant using SBLF funds must certify to the institution that the principals of the business have not been convicted of a sex offense against a minor. Under the Securities Purchase Agreement, annually until redemption, the SBLF participant is required to provide the certifications to Treasury that businesses receiving loans from the bank have certified that their principals have not been convicted of a sex offense against a minor.
(2) Each SBLF participant must certify that it is in compliance with the requirements of the Customer Identification Program, which is intended to enable the bank to form a reasonable belief that it knows the true identity of each customer.
ANSWER: When a Small Business applies for a SBA Loan at a local bank, they must complete certain application forms. One of those forms now is a form to certify that, none of the PRINCIPALS (Owners) of that business has been previously convicted of a sex offense against a minor as defined in the Adam Walsh Act (42 USC 16911). In addition, those owners, until the loan is paid back, must ANNUALLY sign that form, to prove no sex offense against a minor has occurred in the past year.
In the last Congress (111th) they passed a bill which added that requirement to Small Business Loans. If you want to read more about what happened BACK then use these two links: HERE and HERE you should be able to get the gist of what Congress did back then.
Definitions:
Minor in AWA: A person under 18;
Read 42 USC 16911 HERE it is quite long.
Small Business Lending Fund (SBLF)
New website for Self Employment Assistance Center
