SUSPENSION OR DEBARMENT BECOMING A COURSE OF FIRST ACTION
Government contractors should be aware that federal agencies are more frequently pursuing suspension or debarment as a first step in compliance efforts, and not just a potential final action after the conclusion of any legal proceedings or internal investigation. Suspension and debarment actions are up, overall, as well. Violations of the Services Contract Act, mentor-protégé program misrepresentations, and a failure to update reps and certs in SAM.gov are just three focus areas. It’s not just large businesses that are subject to these actions. Small businesses, 8(a) firms, and even unsuccessful offerors may find themselves in front of a suspension and debarment official. Government contract attorneys say that the best defense against suspension or debarment proceedings is a good offense. Having policies, procedures, and regular training on compliance can all be the difference between being sidelined or not, even when things go wrong. If a company is notified of a suspension or debarment action, contrition and cooperation are recommended. Government contractors should also make sure they check the list of people and companies on SAM’s suspension and debarment list to ensure that they are not doing, or contemplating, business with a suspended or debarred entity. Suspension or debarment can be “a stain that spreads” according to Maria Panichelli, an attorney at McCarter & English. This means that JV partners, teammates, subsidiaries and different corporate divisions can all potentially tarnish your reputation if they are subject to suspension or debarment, even if you’re compliant. Notably, government agencies can take this action for issues that have nothing to do with performance on a government contract and suspension or debarment may take place years after an initial problem, depending on how long it takes an agency to conduct an internal review. Contractors should ensure that they train their people on compliance and ethics requirements, conduct their own due diligence, and communicate any issues regularly with the appropriate contracting officer. No company wants to find itself sidelined, or worse, by a suspension or debarment action.