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Floor Speech
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Mr. WILLIAMS of Texas. Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 1804) to amend the Small Business Act to require a report on 7(a) agents, and for other purposes.
The Clerk read the title of the bill.
The text of the bill is as follows: H.R. 1804
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE.
This Act may be cited as the ``7(a) Loan Agent Oversight Act''. SEC. 2. REPORT ON 7(A) AGENTS.
Section 47 of the Small Business Act (15 U.S.C. 657t) is amended by adding at the end the following new subsection:
``(j) Annual Report.--
``(1) In general.--The Director shall submit to Congress, in addition to the report required under subsection (h)(2), an annual report including, for the calendar year covered by the report--
``(A) the number of 7(a) agents assisting applicants for loans under section 7(a), disaggregated by the type of 7(a) agents consistent with information reported on the Fee Disclosure and Compensation Agreement, or any subsequent agreement forms that collect such information;
``(B) the number of fraudulent loans made for which an applicant used services of a 7(a) agent;
``(C) the purchase rate by the Administrator of loans for which an applicant used services of a 7(a) agent;
``(D) the number and aggregate dollar value of referral fees paid to 7(a) agents, disaggregated by whether the applicant or 7(a) lender paid such fees;
``(E) without identifying individual 7(a) agents by name, a consolidated analysis of the risk created by the individual 7(a) agents responsible for not less than 1 percent of--
``(i) the dollar value of loans made with the assistance of 7(a) agents; and
``(ii) the number of loans made with the assistance of 7(a) agents;
``(F) an analysis of interest rates on loans for which an applicant or 7(a) lender used services of an agent; and
``(G) a description of how the Administrator communicates with 7(a) agents.
``(2) Definitions.--In this subsection:
``(A) 7(a) agent.--The term `7(a) agent' means a person who provides covered services on behalf of a lender or applicant.
``(B) Covered services.--The term `covered services' means--
``(i) assistance with completing an application for a loan under section 7(a) (including preparing a business plan, cash flow projections, financial statements, and related documents); or
``(ii) consulting, broker, or referral services with respect to a loan under section 7(a).''.
Mr. Speaker, I rise today in support of H.R. 1804, the 7(a) Loan Agent Oversight Act, introduced by Representatives Meuser and McIver.
H.R. 1804 is an important piece of legislation that brings an additional layer of transparency in the fight against fraud in the Small Business Administration's flagship 7(a) loan program.
This bill would require the SBA Office of Credit Risk Management to submit annual reports to Congress on the 7(a) loan program. The reports would include the number and dollar value of fraudulent loans associated with loan agents. The SBA already collects this information, and an annual reporting requirement would allow for more effective oversight.
Similar versions of this bill have passed on the House floor with bipartisan support in both the 117th and 118th Congresses. I look forward to seeing the Senate take swift action on this bill, which supports President Trump's agenda to root out fraud and abuse.
Mr. Speaker, I urge my colleagues to support H.R. 1804, and I reserve the balance of my time.
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Mr. WILLIAMS of Texas. Mr. Speaker, I urge my colleagues to support this commonsense legislation, and I yield back the balance of my time.
The SPEAKER pro tempore (Mr. Sessions.) The question is on the motion offered by the gentleman from Texas (Mr. Williams) that the House suspend the rules and pass the bill, H.R. 1804.
The question was taken.
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Mr. WILLIAMS of Texas. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
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