Walking the Tightrope: Procurement Compliance and Over-Compliance

Striking a balance between conservatively following government contract regulations and allowing government procurement processyour business to run effectively without over-compliance is not an easy road to hoe.

Whether your business’ procurement compliance program is non-existent and may result in government authority knocking at the door at any moment or is over-burdensome and may lead to missed business opportunities and reduced revenues as a result of unnecessarily stringent internal policies — you need an objective eye to evaluate your business and its compliance approach.

As a bare-bones starting point, businesses looking to increase profits by engaging in government contracts must adhere to the following:

• False Claims Act (FCA)
• Foreign Corrupt Practices Act (FCPA)
• Truth in Negotiations Act (TINA)
• International Traffic in Arms Regulations (ITAR)

However, this is by no means an all-inclusive list of the applicable federal statutes and regulations. When management must allocate corporate resources sparingly, relying on industry professional government contracts attorneys is critical to getting the most bang for your buck.

Which types of procurement investments – technology, personnel, etc. provide the most benefit for the least cost – which area(s) of procurement – is it the sourcing process, the buying process, etc. are a crucial focal point of government enforcement?

Cornerstones of procurement and FAR compliance in the government contracts procurement process must include more than merely rules to follow.  The rules must adapt and change along with continually evolving reporting requirements and regulations. Employees must have proper training.

Training is critical because following laws in the abstract is much simpler than adhering to the practical details of those laws. For example, employees likely understand that bribing public officials is a violation of law. But, less obvious is the fact that bribery can encompass even such seemingly innocuous acts as buying lunch for a government official.

Additional aspects of an effective procurement compliance plan include a code of ethics with teeth – internal consequences for employees that fail to adhere and even a reward structure for successful compliance; this carrot and stick approach works effectively. Importantly, employees must have a mechanism for reporting improper conduct, and the company must engage in timely reporting.

The bottom line: if your company is looking to avoid suspension and debarment or looking to streamline your procurement, we can help.

For immediate assistance in procurement implementation or streamlining, call our Government Procurement Attorneys at 1-866-601-5518.