Sec. 2107. CONTRACTOR MALFEASANCE
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## SEC. 2107 CONTRACTOR MALFEASANCE Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) is amended by inserting before the undesignated matter following paragraph (12), as added by section 2101 of this Act, the following: > > #### “(13) Supplemental assistance for contractor malfeasance > > > ##### “(A) In general > > If a contractor or other person engages in malfeasance in connection with repairs to, rehabilitation of, or replacement of real or personal property relating to which a loan was made under this subsection and the malfeasance results in substantial economic damage to the recipient of the loan or substantial risks to health or safety, upon receiving documentation of the substantial economic damage or the substantial risk to health and safety from an independent loss verifier, and subject to subparagraph (B), the Administrator may increase the amount of the loan under this subsection, as necessary for the cost of repairs, rehabilitation, or replacement needed to address the cause of the economic damage or health or safety risk. > > > ##### “(B) Requirements > > The Administrator may only increase the amount of a loan under subparagraph
(A)upon receiving an appropriate certification from the borrower and person performing the mitigation attesting to the reasonableness of the mitigation costs and an assignment of any proceeds received from the person engaging in the malfeasance. The assignment of proceeds recovered from the person engaging in the malfeasance shall be equal to the amount of the loan under this section. Any mitigation activities shall be subject to audit and independent verification of completeness and cost reasonableness.” > .
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Sec. 2107
CONTRACTOR MALFEASANCE
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