PETALUMA,Calif., Aug. 20, 2014 /PRNewswire-USNewswire/ -- A survey by theAmerican Small Business League (ASBL)of over 2000 Chambers of Commerce across the country found overwhelmingopposition to the Small Business Administration's (SBA's) proposed "safe harbor from fraud" policy.

Overthe course of two months the ASBL contacted a sampling of Chambers of Commercein all fifty states. Most of the chambers contacted were shocked that such apolicy had even been proposed.

Undersection 16 (d) of the Small Business Act, any firm thatmisrepresents itself as a small business to illegally receive federal smallbusiness contracts can be punished by up to ten years in prison, a fine of notmore than $500,000 or both.

Underthe proposed "safe harbor from fraud" policy, a large business thatis caught misrepresenting itself as a small business to illegally land afederal small business contract can avoid any jail time or fines by simplyclaiming they "acted in good faith".

In1995, the SBA Inspector General began sounding the alarm on large businesses fraudulently misrepresenting themselves to hijack federalsmall business contracts. In 2005, in Report 5-15, the SBA Office of InspectorGeneral describes the diversion of federal small business contracts to largebusinesses as, "One of the most important challenges facing the SmallBusiness Administration (SBA) and the entire Federal Government today…"

EverySBA Inspector General since 2005 has continued to name the diversion of federalsmall business contracts to large businesses as the number one challenge at the SBA.

Report 5-16 from the SBA Inspector General found largebusinesses were fraudulently landing federal small business contracts by making"false certifications."

PresidentObama acknowledged the magnitude of fraud and abuse at the SBAwhen he released the statement, "It istime to end the diversion of federal small business contracts to corporategiants."

Fox News, CNBC, MSNBC, NBC, ABC, CBS and CNN haveall covered the diversion of federal small business contracts to Fortune 500firms and thousands of large businesses.

TheSBA has refused to adopt any polices to halt the rampant fraud. Instead the SBAis taking public comment on the "safe harbor from fraud" policy thatwill likely encourage fraud in federal small business contracting programs.

Individualsthat wish to send the SBA a comment on the "safe harbor from fraud"policy can do so going to the proposed rule's website. The comment period will end thisupcoming Monday, August 25.

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