Category: Administrative law

Applying for an SBA loan with a criminal record

*NEW: Applying for SBA COVID-19 relief with a criminal record in 2021 (March 8, 2021) Loans from the U.S. Small Business Administration (SBA) are a key resource for small businesses fighting to survive during this pandemic.  SBA loans are generally loans provided by private lenders and guaranteed by the federal government.  The $2+ trillion stimulus package (the CARES Act) signed into law today, includes more than $300 billion in funding for new SBA loans called the “Paycheck Protection Program,” some of which are eligible for forgiveness. These loans are to be provided under SBA’s primary loan program, the 7(a) loan program, but they increase eligibility for 7(a) loans, extend their allowable uses, and allow for loan forgiveness, among other provisions.  (See H.R. 748, sec. 1102; 15 U.S.C. 636(a)).  Notably, a Paycheck Protection Loan may be used—in addition to already-allowable uses under 7(a)—for payroll support (including paid sick, medical, or family leave, and group health care benefit costs during leave), employee salaries, mortgage payments, rent, utilities, and any other debt incurred before February 15, 2020.  See H.R. 748, sec. 1102.  Further, for all 7(a) loans made between February 15, 2020 and June 30, 2020, loaned funds would be eligible for forgiveness […]

Read more

Will restrictions on banking jobs be relaxed for people with a record?

More than two dozen organizations dedicated to improving employment opportunities for people with a criminal record have written to the FDIC urging that it give regulated financial institutions greater latitude to hire qualified people without having to ask the FDIC’s permission.  The occasion is the FDIC’s proposal to reduce to a formal rule its longstanding policy on employment of convicted individuals by banks, a proposal that suggests the FDIC may be open to giving banks more hiring autonomy by relaxing several controversial provisions.  For 20 years, the FDIC has kept a tight grip on banks, requiring them to obtain a waiver before they may hire anyone with a record even in an entry-level non-professional position.  In operation, this policy has been an effective bar to bank employment for most people with a conviction record (and even for some who have never been convicted). The letter, organized by the National Employment Law Project and the Leadership Conference on Civil and Human Rights, points out that FDIC’s exclusionary policy is not required by its enabling statute, and urges the agency to bring its policy on hiring waivers into line with national efforts to further reintegration, in several different ways, some of which […]

Read more

Broken records: criminal history errors cost jobs and housing

Ariel Nelson of the National Consumer Law Center has authored an important new report, Broken Records Redux, which describes how errors by criminal background check companies harm consumers seeking jobs and housing.  In particular, the report shows how background screeners continue to include sealed and expunged records in criminal background check reports, omit disposition information, misclassify offenses, mismatch the subjects of records, and include other misleading information.  The report also examines problems arising from the use of automated processes to evaluate prospective employees and tenants. This report, a sequel to a 2012 NCLC report on criminal background errors, observes that since 2012 advocates and federal agencies have litigated many actions for violations of the Fair Credit Reporting Act (FCRA), leading to settlements and judgments requiring background screeners to reform their processes and pay millions in penalties and relief to consumers.  Despite these lawsuits, “companies continue to generate inaccurate reports that have grave consequences for consumers seeking jobs and housing.”  Based on these issues, the report recommends a broad array of legislative and regulatory changes at the federal and state level.  Accompanying the report is an article: Fertile Ground for FCRA Claims, which describes FCRA violations that can result from “inaccurate, incomplete, […]

Read more

Model law proposes automatic expungement of non-conviction records

An advisory group drawn from across the criminal justice system has completed work on a model law that recommends automatic expungement of most arrests and charges that do not result in conviction.  Margaret Love and David Schlussel of the Collateral Consequences Resource Center served as reporters for the model law.  It is available in PDF and HTML formats. “Many people may not realize how even cases that terminate in a person’s favor lead to lost opportunities and discrimination,” says Sharon Dietrich, Litigation Director of Community Legal Services of Philadelphia, and one of the advisors of the model law project.  “Over the years, my legal aid program has seen thousands of cases where non-convictions cost people jobs.” In proposing broad restrictions on access to and use of non-conviction records, the project aims to contribute to conversations underway in legislatures across the country about how to improve opportunities for people with a criminal record.  Already in 2019, states have enacted more than 130 new laws addressing the collateral consequences of arrest and conviction.  The group regards its model as the first step in a broader law reform initiative that will address conviction records as well. Law enforcement officials make over 10 million arrests […]

Read more

Administration withdraws proposal to require federal job-seekers to disclose diversions

The Washington Post reports that the White House has directed the Office of Personnel Management (OPM) to drop its proposal to expand the types of criminal records that must be disclosed by applicants seeking federal jobs and contracting work.  OPM’s proposal, which we described in March, would have required applicants for federal jobs and contracting work to disclose participation in pretrial diversion programs in the last 7 years. In March, we launched our non-conviction records project, a major study of the public availability and use of non-conviction records – including arrests that are never charged, charges that are dismissed, deferred and diversionary dispositions, and acquittals.  The appearance of these records in background checks can lead to significant discrimination against people who have never been convicted of a crime, and result unfairly in barriers to employment, housing, education, and many other opportunities.  Our letter opposing the OPM proposal cited our research on diversions and pointed out that while “state lawmakers, judges, and prosecutors favor diversionary dispositions in appropriate cases to help people avoid the restrictions and stigma of a conviction, OPM’s proposal disfavors them by treating them like convictions.” We are pleased to see the administration quash this ill-advised proposal, in the face of opposition from advocates […]

Read more