Wednesday, July 27, 2011

Suspension and Debarment - Part II

Suspension and debarment are two classifications that contractors never want to have associated with themselves. To be suspended or debarred from Government contracting affects profitability and in some cases, even the continued existence of a going concern.

Yesterday, we listed the events and criteria that could eventually lead to a suspension as well as some of the circumstances that could stave off such a determination. The burden of proof is quite low. In some situations, an indictment is sufficient to suspend a contractor from further work with the Government. Today we will discuss the administrative procedures that must precede a suspension determination and opportunities for contractors to wage a defense. Tomorrow we will discuss "debarment".

Every agency has its own internal procedures governing the suspension decision making process. FAR only requires that these procedures be as informal as is practicable, consistent with principles of fundamental fairness. These procedures must afford the contractor an opportunity following the imposition of a suspension, to submit, in person, in writing, or through a representative, information and argument in opposition to the suspension.

If the Government decides to suspend a contractor, it sends written notification stating the basis for the suspension (e.g. an indictment or other adequate evidence that the contractor has committed irregularities of a serious nature in business dealings with the Government or serious reflecting on the propriety of further Government dealings with the contractor). While this notice may not be comprehensive, it must be sufficient to put the contractor on notice without disclosing the Government's evidence. Subsequent to official notice, the contractor has 30 days to respond and provide any information that raises a genuine dispute over the material facts described in the Government's suspension letter.

As a practical matter, if the suspension is based on an indictment or on the basis of the Department of Justice advice, or if the contractor's submission does not raise a genuine dispute over material facts, the notice of suspension becomes final - the "Suspending Official" makes a decision to suspend. For situations where additional proceedings are necessary as to disputed material facts, the suspending official will base his/her decision on the facts as found, together with any information and argument submitted by the contractor and any other information in the administrative record.

Based on review of all the data, the suspending official may modify or terminate the suspension or leave it in force. In no case may a suspension extend beyond 18 months unless legal proceedings have been initiated within that period. If so, the suspension continues until the proceedings are completed.

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