Who this affects

Arrest records and small business

Checked 2026-08-25

In 2024 the SBA made a past conviction irrelevant to a 7(a) loan and to a guaranteed surety bond — but kept "under indictment" as a disqualifier in both. The window between charge and disposition is the only period that shuts off SBA credit and bonding at once.

What changed, and what did not

The SBA's 2024 rule on criminal justice reviews, effective 30 May 2024, rewrote the eligibility test. Under 13 CFR § 120.110(n) a business is ineligible where an Associate is currently incarcerated, serving a sentence imposed on adjudication of guilt, or is under indictment for a felony or any crime involving or relating to financial misconduct or a false statement. Probation and parole status went, and prior convictions as a standalone bar went with them. A completed sentence no longer disqualifies.

Surety bonding matches it: 13 CFR § 115.13(a)(2)(i) applies the same standard to Principals: 13 CFR § 115.13 sets that at 20% or more, officers, directors and general partners.

SBA Form 1919 now asks exactly one question about this, and it is the indictment question. There is no longer a question about past arrests or past convictions on the form.

The practical consequence is precise: the charge is the disqualifier, and it disqualifies while it is unresolved — which is exactly the period during which nothing has been proven.

The charge attaches to the company

Federal contracting makes this explicit. FAR 52.209-5 requires an offeror to certify whether it and its principals are presently indicted for, or otherwise criminally or civilly charged by a governmental entity with, the enumerated offences — with principal defined to include an officer, director, owner or partner. The owner's pending charge is certified on behalf of the business, and the offeror must give written notice if the certification becomes erroneous before award.

Note the asymmetry with FAR 52.209-7, which requires disclosure of a criminal conviction for larger contract holders. One clause is charge-keyed; the other is conviction-keyed. The charge-keyed one bites first.

State licensing can publish the pending matter too. California's contractor board is required by B&P § 7124.6 to disclose complaints referred for accusation or under enforcement investigation — pending accusations become public before any final discipline — and its lookup is searchable by contractor personnel name, tying the individual to the licence.

Where the search result costs money

For an owner, the record does not stay personal. It attaches to the business name in search, sits next to your reviews, and reaches customers, lenders, landlords and partners who never learn the disposition.

That layer — aggregator copies, people-search profiles, local coverage — is what removal work addresses. The federal certifications and the licensing board's own publications are not removable, and the honest advice is to handle those with counsel and treat the search results as the separate, solvable problem.

Two programmes with their own, narrower rules

The headline eligibility test is not the only one, and the adjacent programmes are more forgiving than the one people read about.

Microloans apply a current-incarceration test alone, with a narrow probation and parole carve-out limited to childcare businesses and offences against children. Disaster loans likewise turn on current incarceration. So an applicant who is ineligible for one product may be eligible for another, and the question is worth asking product by product rather than being answered once.

On hiring, the federal bonding programme is the least-known useful thing here. It issues fidelity bonds covering employer loss from employee dishonesty — theft, forgery, larceny, embezzlement — at 100 per cent with no deductible, covering the first six months of employment at no cost to either the employer or the applicant. If a record is making someone hard to hire, or making you hard to hire, that is the instrument built for it.

Licensing is the remaining exposure and it varies by state. A majority of states now require that a conviction bear a direct or substantial relationship to the occupation before it can bar a licence — though many licensing statutes keep a good-character clause that can still reach a non-conviction record.

Try the free route first

Google removes your home address, phone number, email and — since February 2026 — government ID numbers at no cost. More than 10 million people have used it. It does not cover arrest records, and it will not touch a government or newspaper page, but it is free and it is worth running first.

Open Google’s Results about you tool

Sources

• 13 CFR § 120.110
• 13 CFR § 115.13 — surety bond good character
• SBA final rule — criminal justice reviews (89 FR 34094)
• SBA Form 1919
• FAR 52.209-5
• Cal. Bus. & Prof. Code § 7124.6
• 13 CFR 120.707 — microloan eligibility
• DOL — Federal Bonding Program
• Council of State Governments — fair chance licensing across states

Every claim on this page traces to the sources above, checked on 2026-08-25. Rules in this area change — several of the ones on this page changed in the last three years. If you find something here that is out of date, tell us and we will fix it.