New Suspension And Debarment Bill: Positive Changes, Causes For Concern
In a recent client update, we discussed proposed legislation, entitled the Comprehensive Contingency Contracting Reform Act of 2012, that would provide for the automatic suspension of a contractor in a variety of situations, including when the federal government merely alleges fraud against a contractor in a civil or criminal proceeding related to a federal contract. We noted that the proposed legislation was roundly criticized by representatives of the affected agencies: the Department of Defense, the Department of State and the U.S. Agency for International Development. See "Shift to 'Automatic' Ineligibility Determinations Poses Increased Risk to Federal Contractors".
Now a new bill changes the automatic suspension into an automatic referral to suspension and debarment officials for final decision making.
The following persons would be subject to these referrals:
A person who has been charged with a federal criminal offense relating to the award or performance of a contract of a covered agency. A person who has been alleged, in a civil or criminal proceeding brought by the United States, to have engaged in fraudulent actions in connection with the award or performance of a contract of a covered agency. A person who has been determined by the head of a contracting agency of a covered agency to have failed to pay or refund amounts due or owed to the federal government in connection with the performance of a contract of the covered agency. The words "brought by the United States" within the second basis for referral suggest that referrals will not extend to all qui tam cases brought by relators but only to those in which the government has intervened in a qui tam action or has brought an independent lawsuit. This would be a welcome and rational limitation, assuming this interpretation prevails.
The third basis, however, is cause for contractor concern because it seems to include legitimate...
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