Procurement suspension or debarment from government contracts come into play when you do not comply with the terms and conditions of your contract. Not all companies understand what has to be done to overcome proposals for suspension or debarment or how to meet the preponderance of the evidence standard that can get the process reversed.
The consequences are serious and can severely impact your business revenues. How you respond to a proposed suspension or debarment notice is critical. This can include anything for contract clause compliance or involvement with contract procurement fraud, forgery, false statements and more.
Suspension or debarment of government contractors also give agencies protecting from doing business with individuals/companies/recipients who pose a business risk to the government. Procurement suspension or debarment are not conclusive to what an agency alleges. Instead, the facts and circumstances drive the outcome.
Impact of suspension debarment of government contractors
After you meet the “debarred meaning”, the impact your personal and business’ future can be a very serious matter. As a practical matter, developing internal audit reports and having your company evaluated for compliance can minimize the impact of debarment and suspension of government contractors.
- Consider having a tailored compliance roadmap that minimizes terrible audit reports from DCAA, IG or DOJ.
Suspension debarment of government contractors impact the ability of companies to participate in future government contracts, subcontracts, government loans and other federal programs. (See 2 CFR Part 180 and 2 CFR Part 1532). This can have a crippling effect of a company’s revenues.
When you are involved in criminal indictments, involved in theft, forgery, poor contract performance, of found making false statements to the federal government, suspension actions can last up to one year.
- The action is effective immediately.
Appealing the government’s suspension or debarment action is possible but difficult. When looking at the legal contract suspension definition, concerns arise as to whether government contractors are already guilty without a trial or legal action. However, such a defense will not stand up in court. See information about appeals of suspension or debarment decisions.
Definition of Debarment
Agency proposals for debarment involves more serious consequences. If government contractors are convicted of judgments or involving environmental crimes, contract fraud, embezzlement, theft, forgery, bribery, poor performance, non-performance or making false statements to the federal government, you can be held to permanent debarment from government government contracts and from doing business with the federal government.
Agency Discretion to Recommend Procurement Suspension and Debarment of Government Contractors
The law allows government agencies wide latitude to recommend debarment and suspension of government contractors for issues that are serious and that can seriously impact procurement integrity. This is a broad net. Some of the common actions that can trigger procurement suspension or debarment of government contractors:
- fraud or criminal offenses government wide in connection with obtaining, attempting to obtain, or performing a public contract
- violation of federal or state antitrust laws relating to the submission of offers
- embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, tax evasion, or receipt of stolen property
- violations of the Drug-Free Workplace Act of 1988
- intentional misuse of the “Made in America” designation
- violation of Trade Agreements Act (TAA)
- unfair trade practices, as defined in Section 201 of the Defense Production Act
- other offenses indicating a lack of business integrity or honesty that seriously affect the present contractor responsibility.
if there is evidence of “any other cause of so serious or compelling a nature that affects the present responsibility of a … contractor or subcontractor.”
A suspension lasts only as long as an agency’s investigation of the conduct for which the contractor was suspended, or any ensuing legal proceedings. It may not exceed 18 months unless legal proceedings have been initiated within that period.
Read more about Administrative Agreements During Suspension or Debarment
Find out more about Defending and Responding to Contractor Suspension or Debarment.
For more information about suspension debarment from government contracts or if you are facing indictment, need help navigating through the debarment process or involved in a federal suspension and debarment action, call a suspension debarment lawyer or a white collar criminal defense attorney at 1-866-601-5518.