Monday, August 1, 2011

Suspension and Debarment - Part V

We've come to the last part of our short series on suspension and debarment. The Government's decision to suspension or debarment depends primarily on the sufficiency of the evidence. Suspension requires adequate evidence while debarment requires the preponderance of evidence. A suspension lasts up to 18 months while debarment lasts up to three years. Either one can be extended if litigation is going on that is related to the activity causing the action. Both suspension and debarment actions can be mitigated if a contractor takes remedial action and seems contrite.

The most effective steps a contractor can take to avoid or protect against suspension and debarment are actions that demonstrate they are responsible contractors. Here are a few rules for guarding against a future suspension or debarment.

  • Develop and maintain effective standards of conduct and an effective internal control system.
  • Take appropriate disciplinary action against individuals in your organization that are responsible for wrongdoing.
  • Implement correct actions following the discovery of wrongdoing.
  • Continuously review internal control procedures and revise when necessary.
  • Implement an ethics training program (now contractually required in many contracts).
  • Develop an internal program that illustrates management's commitment to ethical behavior. Set the proper tone at the top.

Establishing these rules is no guarantee that a contractor can avoid a suspension or debarment. Because of this fact and because the financial effect of either action can be devastating, contractors should involve legal counsel in any matter that could lead to a suspension or debarment.

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