1. Suspension and Debarment How does it work? Randy Sawyer, ICE SDO

2. ICE CONTEXT Communication 4 Remedies What, Why, Who, When, Where

3. ICE Authority and Types Authority Inherent - Necessarily incidental to effective administration of the statutory scheme Express - Derives from statute or Executive Order Type Administrative – discretionary Statutory – “thou shall be debarred”

4. ICE A Privilege Not a Right Perkins v. Lukens Steel Co., 310 U.S. 115  Contracting with the Government is a privilege not a right. The Government enjoys unrestricted power to determine with whom it wishes to conduct business.

5. ICE PURPOSE Not punishment! The Government must protect the public interest by conducting business or conferring benefits only with presently responsible parties.

6. ICE Basic Authorities Federal Acquisition Regulation ( FAR or 48 C. F. R. § 9) Nonprocurement Common Rule (2 C. F. R. § 180) There are some differences, but both provide similar protection to the government. The rules are reciprocal.

7. ICE Definition of Contractor (FAR 9.403) “Contractor” means any individual or other legal entity that— (1) Directly or indirectly (e.g., through an affiliate), submits offers for or is awarded, or reasonably may be expected to submit offers for or be awarded, a Government contract, including a contract for carriage under Government or commercial bills of lading, or a subcontract under a Government contract; or (2) Conducts business, or reasonably may be expected to conduct business, with the Government as an agent or representative of another contractor.

8. ICE Definition of Participant (2 C.F.R. § 180.980) “Participant” means any person who submits a proposal for or who enters into a covered transaction, including an agent or representative of a participant.

9. ICE What is Suspension and Debarment? Suspension  An action taken to address an immediate need to mitigate risk to the Government  Standard of Proof = Adequate evidence + immediate need Debarment  An action taken for a specified amount of time to address issues of present responsibility  Standard of Proof = Preponderance of evidence

10. ICE Suspension: FAR 9.407 & 2 C.F.R. § 180.700 Suspension is a serious action, imposed based on “adequate evidence” and when immediate action is necessary to protect the Government’s interest. Is for a temporary period pending the completion of the investigation and any ensuing legal proceedings.

11. ICE Debarment: FAR 9.406 & 2 C.F.R. § 180.800 May be imposed only upon a debarring official’s finding that: 1. a cause for debarment exists; and, 2. debarment is in the government’s interest. A cause for debarment may be established either upon 1. a criminal conviction or civil judgment; or, 2. a “preponderance of the evidence.” The burden is on the contractor to present evidence of present responsibility.

12. ICE Suspension & Debarment Causes Suspend: FAR 9.407-2 & 2 C.F.R. 180.700 Debar: FAR 9.406-2 & 2 C.F.R. 180.800 Criminal and Civil Violations  Violations Relating to Public Contracts and Transactions (fraud; anti-trust; theft; bribery; false statements; etc.)  Violations of Certain Statutes (Made in America; Drug Free Workplace; CWA, CAA, etc.)  Other Offenses Indicating a Lack of Business Honesty

13. ICE Suspension & Debarment Causes (cont.) Performance of Public Contracts and Transactions (willful failure to perform; history of failure to perform) Certain Labor and Trade Violations (FAR 9.403) Additional Causes Under 2 C.F.R § 180.700 and.800 Failure to pay a single substantial debt Violation of a material provision of any settlement of a debarment or suspension action Other Serious or Compelling Causes

14. ICE Period of Suspension FAR 9.407-4 and 2 C.F.R. § 180.760 For a temporary period. Initially no more than 12 months. If legal proceedings are not initiated within 12 months after the suspension notice, it may be extended an additional 6 months if an Assistant Attorney General requests. Suspension may not exceed 18 months unless legal proceedings have been initiated within that period.

15. ICE Period of Debarment The period of debarment is commensurate with the seriousness of the cause. FAR 9.406-4 and 2 C.F.R. §180.865 both state the period is generally not more than 3 years. However, some violations have statutorily imposed longer or shorter periods. Mitigating circumstances and remedial measures may be considered. The period of suspension must be considered.

16. ICE Adequate Evidence FAR 9.403 & 2 C.F.R. § 180.700 Information sufficient to support reasonable belief that a particular act or omission has occurred. Sufficient: Indictment, search warrant, IG report, IG audit Not sufficient: News article, civil settlement w/o admission guilt

17. ICE Immediate Need Not defined in the FAR or the NCR No specific finding necessary, may be inferred from facts and circumstances and obvious from the record Decision to suspend is prudent given the risk potential under the circumstances

18. ICE Scope of Suspension & Debarment Fraudulent, criminal, or other seriously improper conduct may be imputed:  from individual to contractor;  from contractor to individual; or  from a contractor in a joint venture or similar arrangement to other participating contractors.

19. ICE Imputed Conduct and Debarment Knowledge Not defined but authorized under FAR 9.406-5 and 2 C.F.R. § 180.630 Hold another entity responsible for acts of offending entity such that both entities are deemed culpable or blameworthy of the offending act Reason to know. Not - should have known.

20. ICE Affiliates Control Relationship between one entity and another that extends government business risk beyond the offending party itself FAR 9.403 & 2 C.F.R. § 180.905 Nothing to do with culpability or blameworthiness Solely about subject to control of another person who is culpable

21. ICE De-Facto Debarment Withholding a Government contract or assistance award from an otherwise eligible entity based on its lack of business integrity without resorting to the debarment process; or, Repeatedly using the CO “responsibility determination” to deny awards in place of an official debarment decision.

22. ICE Referrals normally include: Signed referral for suspension or debarment Copies of investigative reports Summary of pertinent evidence and status of legal proceedings Docket number and court Referrals can be conviction-based or fact-based

23. ICE Referrals (con’t) Status of Respondent company (new owner) Status of Respondent individual (in custody, employed) Respondent information (name, DOB, address, SSN, DUNS) Link analysis, if performed Did Respondent Cooperate? Any other appropriate exhibits or documents

24. ICE Initial Steps by SD Basic research/analysis Establish Nexus Actionable misconduct on grants and awards with a lower standard for suspensions Prepare Administrative file/SD file Include affiliates/impute? Which rule to use? Interagency Suspension and Debarment Committee (ISDC) Lead Agency email Database tracking

25. ICE Administrative Options “Request For Information” or “Show Cause” letter Suspension (adequate) Propose for Debarment (preponderance) No Action/Transfer to another Agency Find Responsible/Voluntary Exclusion Debar Administrative Compliance Agreement

26. ICE Research Websites 1. Central Contractor Registration (CCR); https://www.sam.gov/portal/SAM/#1https://www.sam.gov 2. Dun & Bradstreet (D&B); http://www.dnb.com/us/http://www.dnb.com/us/ 3. System for Award Management (SAM); https://sam.gov/portal/SAM/#1https://sam.gov 4. Agency contract writing program can be checked to see if your agency has any current contracts 5. Federal Procurement Data System (FPDSNG); http://www.fpdsng.comhttp://www.fpdsng.com 6. Electronic Data Gathering, Analysis, and Retrieval System (EDGAR); http://www.sec.gov/edgar.shtml http://www.sec.gov/edgar.shtml 7. Business Identification Number Cross Reference System (BINCS); http://www.bpn.gov/bincs/http://www.bpn.gov/bincs/ 8. USAspending.gov; http://www.usaspending.govhttp://www.usaspending.gov 9. State Websites, Ex. http://sos.iowa.gov/http://sos.iowa.gov/ 10. Public Access to Court Electronic Records (PACER); https://pacer.login.uscourts.gov/cgi-bin/login.plhttps://pacer.login.uscourts.gov/cgi-bin/login.pl

27. ICE Process Write Action Referral Memoranda (ARM) and Notice Letter for legal review and SDO signature/concurrence. Discuss aggravating and mitigating circumstances. Determine debarment period. SAM entry (FAR based) and send USPS Certified. No response is default debarment. Write Decision Letter and reference initial ARM. Response requires addressing all points raised. Assertions vs. proof. With reply: Debar; Administrative Compliance Agreement; Voluntary Exclusion; Find Responsible.

28. ICE Remedial Measures/Mitigating Circumstances FAR subpart 9.406-1 & 2 C.F.R § 180.860 Effective internal controls and standards Brought activity to GOV attention – timely manner Fully investigated – shared investigation results Fully cooperated during investigation

29. ICE Remedial Measures/Mitigating Circumstances (con’t) FAR subpart 9.406-1 & 2 C.F.R § 180.860 Paid criminal, civil and admin fines – prison/probation Appropriate disciplinary action Remedial measures & internal control procedures Adequate time to reflect Recognize and understand seriousness of misconduct

30. ICE Aggravating Circumstances Actual or potential harm or impact? Frequency of incidents/duration? Pattern of wrongdoing? Excluded/convicted before for same/similar activity? To what extent Respondent involved? Accepted Responsibility? Individual’s position in company? Action pervasive within company?

31. ICE Best Practices Actionable Referrals Proper Guidance Clear Communication

32. ICE Questions?