Kara M. Sacilotto1

I. Introduction

The Federal Acquisition Regulation (FAR), applicable to procurement contracting, and

the Non-Procurement Common Rule (NCR) that applies to non-procurement actions, both allow

for the suspension, proposed debarment, or debarment from contracting or entering into non-

procurement agreements with the United States if the individual or organization is found not

“presently responsible.”2 Although the NCR is more tailored than the FAR in its consideration

of individuals and corporate actors, as discussed further below, both sets of rules are largely

directed at and to corporate actors, not persons, such as company owners, executives, or

employees.3 And, whereas the grounds for suspension and debarment are largely straightforward

as applied to both a corporate entity and an individual, other aspects of the rules have little or no

translation when applied to an individual.4 What, for example, does it mean for suspension or

debarment to be in the “public interest” and “for the Government’s protection,” when applied to

an individual person?5 Further, if a corporate entity is proposed for suspension or debarment, it

can show that despite grounds for exclusion existing, various factors in FAR 9.406-1 or 2 C.F.R.

180.860, commonly referred to as mitigating factors, would suggest that the entity is nonetheless

1 Kara M. Sacilotto is a partner in the Government Contracts Practice Group at Wiley Rein LLP. She is Chair-Elect of the American Bar Association Section of Public Contract Law and a member of the Section’s Debarment and Suspension Committee. The author thanks Mr. Rodney A. Grandon, the former Suspension and Debarring Official for the United States Air Force and now a monitor with Affiliated Monitors, Inc, and Duc H. Nguyen, the Suspension and Debarment Official for the Environmental Protection Agency and former Vice Chair of the ISDC, for their time, for sharing their views on the suspension and debarment system, and for their helpful comments on this article. The author also thanks the ABA Section of Public Contract Law’s Debarment and Suspension Committee for engaging on issues, including the exclusion of individuals, designed to improve the suspension and debarment system and promote engagement between industry, private practice, and Government on issues affecting the suspension and debarment systems. The views expressed in this article are solely those of the author and should not be attributed to Wiley Rein LLP, the ABA Section of Public Contract Law, or any other entity. 2 (a)See, generally, FAR Subpart 9.4 (FAR) and (b) 2 C.F.R. § 180.125(b) (2018) (NCR). 3 (a) FAR 9.403; (b) 2 C.F.R § 180.120(a)(b) (a)ADD CITE (regulation) and (b) ADD CITE (regulation)4 (a)FAR 9.403; (b) 2 C.F.R § 180.120(a)(b) (a)ADD CITE (regulation) and (b) ADD CITE (regulation)5 (a)FAR 9.402(b); (b) 2 C.F.R § 180.700(c)(a) ADD CITE (purpose section of the regulations) and (b) ADD CITE (regulation)

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presently responsible and exclusion is not required to protect the Government.6 Particularly in

the FAR, the mitigating factors are directed at a corporate organization and provide, at best,

rough guidance for assessing how to evaluate whether an individual, despite cause for exclusion

existing, is nevertheless presently responsible.7

Moreover, if a corporate entity is, in fact, excluded from contracting with the

Government, the FAR and NCR provide guidance on the types of activities the excluded entity

cannot undertake (or, more accurately, that the Government should not undertake with respect to

the excluded entity).8 But, neither provides guidance on the restrictions, if any, that should be

placed on an individual’s interactions with the United States. The lack of guidance with respect

to individuals is especially problematic because for many individuals who find themselves

subject to a suspension and debarment action, the FAR’s procedures, in particular immediate

exclusion if an individual or corporate entity is proposed for debarment,9 may present an

immediate career (and livelihood)-ending event that is also difficult to navigate. Although

agency suspension and debarment officials (SDOs) may have developed informal patterns or

practices for how they initiate an inquiry into the present responsibility of individuals who come

before them, neither the FAR nor the NCR provides adequate guidance to that individual facing

potential exclusion.10

Individuals are more vulnerable than corporations because as a group, they tend to lack

access to the resources available to companies, including both counsel and documents, necessary

for their defense.11 Some individuals simply may not respond because they do not understand

6 (a) FAR 9.406-1(a)(10), 9-407-1(b)(2) (b) 2 C.F.R § 180.860 (a) ADD CITE (pull from text) and (b) ADD CITE (regulation)7 ADD CITE (regulation outlining mitigating factors)FAR 9.406-1.8 (a) FAR 9.405-1(b), 9.405(2)ADD CITE and (b) see FAR 9.405.ADD CITE (regulation)9 See FAR 9.405. ADD CITE10 (a)ADD CITE and (b) ADD CITE (regulation)11 ADD CITE

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what facts or information might be relevant or the impact of what it means to be on an excluded

party list.12 Others try to retain counsel, which may be wise (and affordable) for those in

ownership and management positions, but may be cost-prohibitive for “rank-and-file”

employees.13 Yet others, may try to “wing it,” without much insight into what matters to the

evaluation of their present responsibility.14 Still others may be so confused they do not answer at

all.15

Compounding the difficulty of applying the FAR and NCR to individuals, other

regulatory events have made individuals more likely to face the administrative penalties of

suspension and debarment.16 In light of these separate regulatory events and the increase in

suspension and debarment of individuals, it is time to consider changes to the FAR and NCR to

better address the unique circumstances a private person faces when considered for exclusion.

Indeed, several other practitioners have written articles addressing the “disconnect” in the current

regulations as applied to individuals.17

In addition, the American Bar Association Section of Public Contract Law Debarment

and Suspension Committee has devoted significant time to analyzing the issue and discussing

possible regulatory changes to address the different circumstances an individual faces when

proposed for exclusion. Although the rise in exclusionary actions has leveled off in recent years,

as discussed below, individuals still find themselves disproportionately more likely to face

12 ADD CITE13 ADD CITE14 ADD CITE15 ADD CITE16 Yuri Weigel, Note, Is Protection Always in the Best Interestsof the Government: An Argument to Narrow the Scope of Suspension and Debarment, 81 GEO. WASH. L. REV . 627, 631 (2013).ADD CITE17 (a) See, e.g., Daniel E. Schoeni, Note, Personal Debarment For Non-Distributive Corporate Misconduct: On The Efficacy Of Debarring The Individual From Government Contracts For Collective Wrongdoing, 46 Pub. Cont. L.J. 51, 58 (Fall 2016); (b) Warren Bianchi, Equality iIn Exclusion: Empowering Individuals iIn tThe Suspension a And Debarment System, 45 PUB. CONT. L.J. 79 (Fall 2015) [(hereafter “Equality”]).

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suspension or debarment.18 The time is ripe to consider updates to the FAR to reflect modern

practice as well as the different circumstances of an individual facing exclusion. Indeed, Subpart

9.4 of the FAR could use a “refresh,” generally.

This article discusses the current state of the FAR’s rules relating to suspension and

debarment and a few differences present in the NCR, with a focus on application to individuals.

It then identifies changes to the regulatory landscape that have led to more individuals facing

exclusion actions. It ends with considerations for revising the FAR. This final discussion is

divided into the two parts: (1) targeted amendments to better address the different circumstances

of an individual facing exclusion only; (2) overall areas for possible revision based on the

discussion in this article and the evolution of agency suspension and debarment practices.

II. Overview of Suspension Debarment under the FAR and NCR

A. Policy

Under the FAR, it is the policy of the United States to solicit offers from, award contracts

to, and generally only do business with contractors that are responsible.19 Responsibility

includes two general questions: (1) Is the contractor capable of performing the contract? (2) Is

the contractor ethical such that doing business with the contractor is in the interests of the United

States?20 Responsibility is generally considered in two different settings. First, prior to the

award of a government contract, the Contracting Officer must determine that the prospective

awardee is a responsible contractor, and to do so, considers the standards in FAR 9.104-1.21

These factors go to both questions, and ask the Contracting Officer to consider, among other

things, whether the contractor has the financial wherewithal to perform, is able to meet the

proposed delivery or performance schedule, has the organizational experience and production 18 Equality, supra note 17 at 94-95.ADD CITE19 (a) FAR 9.103; (b) FAR 9.402(a).20 FAR 9.104-1.ADD CITE (definition of responsibility)21 FAR 9.103(b).

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capabilities and also whether the contractor has a satisfactory record of integrity and business

ethics.22

If at any time the Government obtains information that may call into question whether a

contractor remains “presently” responsible, the Government may invoke the administrative

remedies of suspension and debarment under FAR subpart 9.4.23 The types of information that

might lead an SDO to question a contractor’s “present” responsibility runs the gamut, and is not

limited at all by the factors in FAR subpart 9.1 or even contracting with the federal government.

They might include an investigation, conviction, or civil matter unrelated to current contract

performance for a particular agency,24 a mandatory disclosure made pursuant to FAR 52.203-

13,25 a matter with the Securities and Exchange Commission,26 again unrelated to performance of

specific government contract, or a matter under the Foreign Corrupt Practices Act.27 In short,

any matter of “so serious or compelling nature that it affects the [contractor’s] present

responsibility.”28 The remainder of this article discusses suspension and debarment when there is

a concern that a contractor is no longer responsible.

B. Who is a “Contractor”?

The FAR defines a contractor to include both “any individual” or “any legal entity” that

“[d]irectly or indirectly (e.g., through an affiliate) submits offers for or is awarded, or may

reasonably be expected to submit offers for or be awarded, a Government contract . . .” or

“conducts business, or reasonably may be expected to conduct business, with the Government as

an agent or representative of another contractor.”29 Thus, from the outset of definitions, the FAR 22 See generally FAR 9.104-123 FAR 9.406-2(a)(5); 9.407-2(a)(9)ADD CITE (pull from text)24 FAR 9.406(2)(a).ADD CITE25 ADD CITE (pull from text)FAR 52.203-13.26 See FAR 9.101.ADD CITE27 15 U.S.C. § 78j (2012).ADD CITE (cite to Foreign Corrupt Practice Act provision on S&D)28 FAR 9.406-2(c). 29 FAR 9.403.

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“lumps” individuals and entities as “contractors,” but defines a contractor almost entirely in

terms of a business entity, as many individuals do not submit offers themselves, receive

contracts, or act as an agent for another contractor, at least not in their individual capacity outside

of an employer.

C. Suspension, Proposed Debarment, and Debarment

Suspension is intended to be a temporary exclusion from government contracting while,

for example, an investigation or criminal or civil proceeding is ongoing, whereas debarment is

for a set term, generally three years.30 The grounds for suspension or debarment are the same

whether the “contractor” is an entity or an individual.31 The evidentiary burden that the

Government must satisfy varies from “adequate evidence”32 for suspensions to

“preponderance”33 for debarment actions.

Under the FAR, a contractor may be, but is not required to be, debarred based on a

conviction or civil judgment for procurement-related misconduct, such as fraud or criminal

conduct in connection with obtaining, attempting to obtain or performing a U.S. government

contract or subcontract, as well as for other federal law violations that might be farther removed

from contract performance, such as antitrust violations and various criminal acts such as

embezzlement, bribery, false statements, tax evasion, receiving stolen property and a “catch all”

of “[c]ommission of any other offense indicating a lack of business integrity or business honesty

that seriously and directly affects the present responsibility of a Government contractor . . .,”

among other things.34 A contractor may be debarred based on a “preponderance of the evidence”

for other types of violations, such as a “willful” failure to perform the terms of a contract, a

30 (a) FAR 9.407-4(a) (period of suspension); (b) FAR 9.406-4(a)(1) (period of debarment).31 FAR 9.403.ADD CITE32 Sloan v. Dept. of Housing and Urban Dev., 236 F.3d 756, 760 (D.C. Cir. 2001). 33 Marshall v. Cuomo, 192 F.3d 473, 478 (4th Cir. 1999). 34 FAR 9.406-2(a)(1)-(3).

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history of poor performance, or delinquent taxes, the knowing failure by a principal to make a

disclosure required under FAR 52.203-13, discussed further below, and a similar “catch all” of

“any other cause of so serious or compelling a nature that it affects the present responsibility of

the contractor. . .,” among other statutory and regulatory violations.35 The grounds for

suspension are similar, but the evidentiary standard that applies is a more lenient “adequate

evidence” standard.36 Under the FAR and NCR, suspension and debarment are reciprocal,

meaning that if an individual or contractor organization is excluded under one set of rules, such

as the NCR, the individual or entity is also excluded from contracting pursuant to the FAR, and

vice-versa.37

These remedies are not intended to be used as an additional form of punishment for

individuals or organizations that have, for example, been convicted of criminal conduct. They

are separate administrative remedies that are intended for use only when necessary to “protect”

the Government’s interests.38 As discussed below, this purpose raises a question of when an

individual poses such a significant risk to the United States that he or she should be excluded

from contracting with the Government.39

Suspension and debarment result in the immediate exclusion of the contractor or

individual from government contracting actions going forward.40 A difference exists between the

FAR and the NCR regarding “proposed debarment,” however. Under the FAR, a contractor

proposed for debarment, even before engaging with the SDO, is immediately excluded and listed

35 FAR 9.406-2(b)(1)(i)(A)-(B), and (v).36 For example, grounds for debarment exist if a contractor has been convicted or received a civil judgment in connection with, for example, fraud relating to a government contract or subcontract. (a) FAR 9.406-2(a)(1)(i)-(iii). A contractor can be suspended, however, based upon “adequate evidence” of the commission of fraud in connection with the performance of a government contract or subcontract. (b) FAR 9.407-2(a)(1)(i)-(iii). An indictment under any of the causes listed in FAR 9.4072 constitutes “adequate evidence.” (c) FAR 9.407-2((b). 37 FAR 9.401. 38 FAR 9.402(b).39 ADD CITE (supra to other section)Cited infra 41.40 FAR 9.405(a).ADD CITE

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on the System for Award Management (“SAM”) excluded parties’ list.41 Under the NCR, by

contrast, proposed debarment does not result in automatic exclusion unless the debarring official

simultaneously issues a suspension in conjunction with the proposed debarment.42 Under both

rules, therefore, an agency debarring official possesses the authority to impose an immediate

exclusion from contracting and non-procurement transactions, even before the contractor has had

an opportunity to respond to the allegations. As discussed below, although immediate exclusion

poses undeniable significant business risks for a contractor organization, it is potentially

catastrophic for an individual.43

D. Imputation of Wrongdoing to and from Individuals

The FAR includes rules that allow for exclusion of related entities through imputation

and affiliation. For example, an affiliate may be suspended or debarred as a result of misconduct

of its parent under the theory that the respondent entity engaged in the misconduct controls or

has the power to control the other affiliated entities or a third party controls or has the power to

control all of them.44

More relevant for individuals, the misconduct of an individual, such as an officer,

director, shareholder, partner or employee of a contractor can be imputed to the contractor

organization if the misconduct occurred during the performance of duties on behalf of the

contractor or with the knowledge and acquiescence of the contractor.45 Likewise, the misconduct

of a corporate contractor may be imputed to an individual, such as an officer, director, employee

41 See FAR 9.404.ADD CITE (FAR provision)42 See 2 C.F.R § 180.810 (2017).ADD CITE (NCR provision)43 Infra Part IVADD CITE (supra to other section)44 (a) FAR 9.403 (definition of affiliates); (b) FAR 9.406-1(b) (debarment decision can extend to affiliates where affiliates are specifically named and given notice of the proposed debarment and an opportunity to respond). One court has held that it is irrelevant whether the affiliate itself ever engaged in misconduct; the fact of affiliation with a suspended (or debarred) entity is sufficient grounds for excluding the affiliate. (c) See Agility Def. & Gov’t Servs. v. Dep’t of Def.ense, 739 F.3d 586, 590 (11th Cir. 2013).45 FAR 9.406-5(a).

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and the like, if the individual “participated in, knew of, or had reason to know of the [corporate]

contractor’s conduct.”46 Where an individual is an officer, but nonetheless did not know or have

reason to know of the misconduct, courts have found exclusion to be inappropriate.47

Courts have also wrestled with whether an individual should be debarred as an “affiliate”

of a contractor organization that is itself excluded.48 Although the term “affiliates” usually

references corporate entities, individuals have been excluded as an affiliate of a suspended or

debarred person or entity. Persons are affiliates of each other if, directly or indirectly, either one

controls or has the power to control the other or a third person controls or has the power to

control both.49 Of course, as noted above, imputation and affiliation are not the only ways an

individual may be excluded; the FAR allows a debarring official to take direct action to exclude

an individual, regardless of imputation or affiliation.50

E. FAR “Mitigating Factors” and NCR Considerations

As discussed above, the FAR includes ten factors that a debarring official should examine

to determine whether, despite grounds for exclusion existing, a contractor is nonetheless

“present[ly] responsib[le].”51 Commonly referred to as “mitigating factors,” these factors are

directed almost exclusively at corporate actors.52 There is debate among practitioners whether

these “factors” in themselves should be revised,53 but for purposes of this article, I accept them as

46 FAR 9.406-5(b).47 See Caiola v. Carroll, 851 F.2d 395, 401 (D.C. Cir. 1988).48 (a) See id. at 400-01 (overturning SDO finding that officers were not “affiliates” of debarred business organization contractor); (b) Int’l Exports, Inc. v. Mattis, Civil Action No. 14–2064 (RBW), 2017 WL 3025837 (D.D.C. July 17, 2017) (upholding SDO finding that two individuals were “affiliates” of debarred business organization contractor). 49 See footnote 3715 (FAR 9.401.), supra. 50 ADD CITE (FAR)FAR 9.406-1(a)51 FAR 9.406-1(a)..52 ADD CITEFAR 9.406-1(a).53 FAR 3.1004.ADD CITE. For example, the FAR’s mitigating factors were established before the FAR was amended to include the provisions requiring contractors performing contracts over 120 days and $5.5 million to have a code of conduct and comply with mandatory disclosure obligations and, except for small businesses and commercial item contracts, establish a system of internal control. Thus, today, having a code, controls, and making disclosures under FAR 52.213-13 is a routine expectation of contract performance. Accordingly, whether meeting what is now a standard requirement should remain a “mitigating factor” is open to debate.

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is. Not infrequently, to respond to an SDO’s concerns while avoiding implicating itself in a

pending civil or criminal proceeding, a corporate contractor will not dispute, or not vigorously

dispute, the underlying facts of the alleged misconduct that has been brought to the attention of

the SDO.54 Instead, it will attempt to demonstrate that despite grounds for suspension or

debarment being potentially met, the contractor is nonetheless presently responsible when its

conduct is considered through the lens of the factors in FAR 9.406-1(a).55 Thus, for a corporate

actor, meeting as many of the mitigating factors as possible is as important, and potentially more

so depending on the facts, as challenging the grounds for exclusion.

With respect to individuals, especially those who may be facing or have faced criminal

prosecution, reliance on the mitigating factors is more challenging. For example, the first

mitigating factor in FAR 9.406-1 asks an SDO to consider whether “the contractor” had

“effective standards of conduct and internal control systems in place at the time of the activity.”56

Clearly, this factor is meaningful only with respect to a corporate actor, which can establish and

demonstrate standards of conduct and internal control systems in place at the time (i.e., that the

organization has not “flying without a net” as a government contractor). But, how would an

individual establish that it had “standards of conduct” or a system of “internal controls”?

The second mitigating factor is “[w]hether the contractor brought the activity cited . . . to

the attention of the appropriate Government agency in a timely manner.”57 A contractor

organization typically can meet this obligation by complying with its mandatory disclosure

obligations under FAR 52.203-13 or otherwise voluntarily bringing misconduct to the attention

of the Government.58 As discussed below, although this article does not necessarily advocate for

54 See FAR 9.406-1. ADD CITE55 See id.ADD CITE56 ADD CITE (FAR from sentence)57 FAR 9.406-1(a)(2).58 ADD CITE (FAR from sentence)

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a similar list of “mitigating factors” for individuals, consideration of transparency and

forthrightness, like the second mitigating factor in the FAR,59 is imminently appropriate.

The third mitigating factor in FAR 9.406-1(a)(3) counsels the SDO to consider whether

the contractor timely investigated the matter and shared the results with the Government.60 This

factor, again, is more squarely applied to a corporate entity, many of which have policies that

encourage employees to report suspected misconduct and internal protocols to investigate those

reports. Generally, an individual does not investigate his or her own misconduct, however.61

The fourth mitigating factor, whether the contractor cooperated with the Government

during any investigation or any court or administrative action,62 sounds, at first blush, like one

that could apply to individuals equally. There is a twist, however: although an SDO could

assess whether an individual cooperated with an investigation or legal proceedings in

determining his or her present responsibility, if there is a criminal prosecution ongoing or

looming in the future, the individual has a right against self-incrimination under the Fifth

Amendment to the U.S. Constitution that may prevent full cooperation as contemplated by the

FAR.63 Thus, an individual may not be able to invoke this mitigating factor, but theoretically the

individuals also should not be penalized for invoking his or her constitutional rights.

The fifth and sixth factors in FAR 9.406-1 – whether the contractor has paid

administrative, civil or criminal penalties or otherwise made restitution and whether the

contractor took appropriate disciplinary action – might be applicable to some, but certainly not

all, individuals.64 Although the owner or majority shareholder of a contractor entity could make

monetary restitution in the form of a payment of damages, refund to the Government, or other

59 Cited infra 185.ADD CITE (cite in article)60 ADD CITE (FAR from sentence)FAR 9.406-1(a)(3).61 See ADD CITEFAR 9.406-1(a)62 FAR 9.406-1(a)(4).63 FAR 52.203-13(c)(2)(ii)(G).ADD CITE64 FAR 9.406-1(a)(5),(6).ADD CITE (FAR from sentence)

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payment, it is less clear whether a “rank and file” contractor employee, like the hypothetical

employee I discuss below in Section __, who does not have financial control within the

contractor organization can make restitution, depending on the nature of the offense that leads to

the exclusion.65 Furthermore, is it really in the interest of the suspension and debarment system –

the goal of which is to protect the Government from contractors who do not behave responsibly66

– to focus on whether an individual can “write a check” to make the exclusion disappear? I

would advocate different factors for an individual. Regarding discipline, the focus of FAR

9.406-1(a)(6), clearly organizations have the ability to discipline their employees and officers

and, frequently, the discipline taken and whether it was directed at all levels of the organization

that led to the debarring official’s concerns is a significant factor. An individual, by contrast,

does not “discipline” herself, at least not in a way that would practically demonstrate present

responsibility to continue contracting with the United States.

The seventh and eighth mitigating factors in FAR 9.406-1 focus on whether the

contractor has implemented or agreed to implement remedial measures and improved internal

controls to prevent a recurrence of the misconduct at issue.67 Once again, the application to a

corporate organization is clear – an SDO would want to know whether the corporate organization

has (without prompting) analyzed the circumstances that led to the SDO’s concerns and

implemented targeted measures to prevent them from recurring. As discussed below, I believe

remediation is a critical factor when considering whether an individual is presently responsible.

The final two FAR 9.406-1 factors do correlate reasonably closely to the type of

considerations an SDO would want to consider in assessing an individual’s present

responsibility. The ninth factor is whether adequate time to eliminate the circumstances that led

65 ADD CITE66 ADD CITE67 ADD CITE (FAR from sentence)FAR 9.406-1(a)(1), (7).

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to the possible exclusion has passed, and the tenth factor addresses whether “the contractor’s

management” understands the seriousness of the misconduct at issue. 68 Thus, it might be

relevant to assessing present responsibility that the events that led to the SDO’s inquiry are long

past without a recurrence of similar or other misconduct. And, a significant indicator of

responsibility is remorse, which is the same as understanding and accepting responsibility for the

misconduct.

Although some of the FAR mitigating factors may translate to individuals better than

others, overall, they are clearly geared to a corporate actor. The NCR also includes mitigating

factors that a debarring official should consider, regardless of grounds for exclusion attaching.69

Some of these NCR mitigating factors would apply more directly to an individual facing

potential exclusion. Relevant factors, different from those in FAR 9.406-1, include:

• The actual or potential harm or impact that results or may result from the wrongdoing.

• The frequency of incidents and/or duration of the wrongdoing.

• Whether there is a pattern or prior history of wrongdoing . . . .

• Whether you are or have been excluded or disqualified by an agency of the Federal Government or have not been allowed to participate in State or local contracts or assistance agreements on a basis of conduct similar to one or more of the causes for debarment specified in this part.

• Whether you have entered into an administrative agreement with a Federal agency or a State or local government that is not government wide but is based on conduct similar to one or more of the causes for debarment specified in this part.

• Whether and to what extent you planned, initiated, or carried out the wrongdoing.

• Whether the wrongdoing was pervasive within your organization.

• The kind of positions held by the individuals involved in the wrongdoing.70

68 FAR 9.406-1(a)(9) and (10).69 2 C.F.R. § 180.860. 70 Id.

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These NCR factors make sense. The impact on the United States should be a relevant factor,

since debarment should only be taken if it is necessary to protect the United States.71 There is a

significant difference between falsifying test reports for a jet engine used by warfighters and

knowingly mischarging eight hours of time. Likewise, it is relevant where the individual sits

within the contractor organization – is she a manager, officer, or owner who has influence over

others or, alternatively, is she an employee with limited or even no ability to direct the contractor

organization as a whole? As discussed below in Section __, several concepts like these from the

NCR would make rational considerations for revisions to the FAR to address individuals facing

exclusion.72

F. Procedures

The procedures for challenging an exclusion action set forth in the FAR could also use a

refresh, generally and as might be appropriate for individuals. The procedures for addressing a

notice of suspension or proposed debarment are set forth in FAR 9.407-3 (suspension)73 and FAR

9.406-3 (debarment).74 Generally, both provisions allow a contractor entity or individual who

has received a notice of suspension or proposed debarment to respond in writing, in person, or

through a representative within 30 days with information and argument in opposition to the

suspension or proposed debarment.75 In actions that are not based on a conviction or civil

judgment, such that there has not been an adjudicated finding of liability, for example, and there

are disputed material facts, the FAR affords contractors and individuals proposed for debarment

the opportunity to appear at a fact-finding hearing before the agency and present and confront

witnesses.76 The debarring agency is required to transcribe the proceedings and prepare findings

71 See generally id.ADD CITE72 Supra Section IV.ADD CITE (supra to lower section)73 ADD CITE74 ADD CITE75 (a) See FAR 9.406-3(c)(4); (b) FAR 9.407-3(c)(5)76 FAR 9.406-3(b)(2)(i).ADD CITE

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of fact in connection with a decision.77 With respect to a suspension, the procedures are slightly

different because of the possibility of ongoing investigative or legal proceedings by the United

States. In this scenario, the FAR provides that if a suspension is not based on an indictment and

the contractor’s submission in opposition raises genuine issues of material fact, the Department

of Justice must weigh in on whether further proceedings would prejudice pending or

contemplated legal action.78 If a fact-finding hearing will not interfere, then similar rights to

present and confront witnesses are available.79

Both FAR 9.406-3 and FAR 9.407-3 provide that agencies should establish procedures

for addressing suspension and debarment that are as informal as practicable.80 These informal

procedures are not always captured in agency-specific regulations, however. As a practical

matter, whether dealing with a multi-billion-dollar corporation or a systems engineer, most

suspension and debarment matters are handled without the type of evidentiary hearing outlined

in the FAR.81 An individual or a corporation typically responds to or challenges the agency’s

action through submission of a written response and additional evidence (perhaps multiple

submissions) and in-person meetings with agency debarring official and her staff.82

But, the FAR says what it says, referring to hearings and witnesses and findings of fact.

These procedures may sound confusing (and daunting) to a layperson who does not understand

terms like “genuine dispute over material fact.”83 A reasonable non-lawyer might also think that

they must retain counsel to respond, given the possibility of a hearing with fact finding and

witnesses – all the trappings of a court proceeding.84 It is not unreasonable to think that some

77 (a) FAR 9.406-3(b)(2)(ii); (b) FAR 9.406-3(d)(2)(i).78 FAR 9.407-3(b)(2).79 FAR 9.407-3(b)(2)(i)-(ii).80 (a) FAR 9.406-3. (b) FAR 9.407-3.81 FAR 302.17.ADD CITE (cite from FAR regulation)82 FAR 302.408.ADD CITE83 ADD CITE (cite from quote of the FAR regulation)FAR 9.407-3(b)(2).84 See ADD CITEFAR 9.406-3(d)(2)(i).

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recipients of such a notice decline to respond, given a perception of expense associated with such

a challenge.85 This is unfortunate and not a benefit to the debarment system. It would benefit

FAR Subpart 9.4 overall to recognize more explicitly that agency debarring officials may have or

should adopt more informal procedures, appropriate for the circumstances, such as information

exchanges and in-person meetings, and that parties are not required to present their opposition

through counsel.

G. Effect of Exclusion

Exclusion is implemented Government-wide by the public listing of the contractor or

individual in the SAM database of excluded contractors and individuals.86 The effects, in terms

of government contracting, of a SAM listing are numerous, but as described in the FAR, they are

relevant primarily to contractor organizations.87 For example, the FAR counsels that agencies

are not to solicit offers from or award contracts to a contractor that is suspended, proposed for

debarment, or debarred.88 Likewise, agencies cannot consent to subcontracts with excluded

contractors, allow such contractors to act as sureties, consider bids in a sealed bidding

competition under FAR Part 14 from an excluded contractor, or evaluate excluded contractors’

proposals, include such contractors in the competitive range, or engage in discussions with them

in negotiated procurements.89

With regard to contracts that have already been awarded and are being performed, the

FAR does not require agencies to terminate those contracts, although an agency could choose to

take that course of action.90 Nonetheless, absent compelling circumstances, agencies are

precluded from expanding work with an excluded contractor by extending the term of a contract,

85 ADD CITE86 FAR 9.404. 87 ADD CITE (cite to referenced FAR provision referenced in the sentence)FAR 9.405.88 FAR 9.405-1(b).89 FAR 9.405-1(c)-(d).90 FAR 9.405-1(a).

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exercising options, adding work to the contract, placing orders under Federal Supply Schedules

or blanket purchase agreements and, in the case of indefinite quantity contracts, placing orders

above the guaranteed minimum.91 And, absent compelling circumstances and with limited

exception, the Government is not supposed to consent to subcontracts with excluded contractors,

and prime contractors are not to award subcontracts to excluded subcontractors.92

As discussed below, these impacts are largely inapplicable to an individual, who, in most

circumstances, does not hold contracts or submit proposals in an individual capacity.93 To be

sure, the FAR does state that contractors who are required to have internal controls pursuant to

FAR 52.203-13(c) should take “reasonable efforts” not to hire as a “principal” someone who due

diligence would have revealed as having engaged in conduct inconsistent with the contractor’s

code of ethics and to certify that no “principal” has been suspended or debarred.94 The FAR

defines a “principal” as “an officer, director, owner, partner or a person having primary

management or supervisory responsibilities within a business unit . . . .”95 But, it does not

identify what restrictions, if any, would apply to a “principal” or lower-level employee without

managerial control who is excluded while already employed in the government contracts space.

As a result, individuals facing exclusion are subject to a wide variety of actions, which differ

more depending on the individual’s position in the organization and the organization’s reaction

to the exclusion than whether they pose a genuine risk to the United States.

91 FAR 9.405-1(b).92 (a) See FAR 9.405-2. (b) FAR 52.209-6. The clause at FAR 52.209-6, Protecting the Government’s Interests when Subcontracting with Contractors Debarred, Suspended, or Proposed for Debarment, creates a narrow exception for excluded subcontractors by prohibiting contractors, absent compelling circumstances, from entering into subcontracts for more than $35,000, other than a subcontract for a commercially-available off-the-shelf item, with an excluded entity. 93 SeeADD CITE (citing to other section in article i)nfra Part IV.94 (a) FAR 52.203-13(c)(2)(ii)(B) and (b) FAR 52.209-5(a)(1).95 FAR 52.203-13(a).

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The NCR is slightly more informative. It states that an excluded person, with limited

exceptions, “may not: (a) Be a participant in a Federal agency transaction that is a covered

transaction; or (b) Act as a principal of a person participating in one of those covered

transactions.”96 The NCR defines a “participant” as “any person who submits a proposal for or

who enters into a covered transaction, including an agent or representative of a participant.”97 A

“principal” is defined as

“(a) An officer, director, owner, partner, principal investigator, or other person within a participant with management or supervisory responsibilities related to a covered transaction; or (b) A consultant or other person, whether or not employed by the participant or paid with Federal funds, who—(1) Is in a position to handle Federal funds; (2) Is in a position to influence or control the use of those funds; or, (3) Occupies a technical or professional position capable of substantially influencing the development or outcome of an activity required to perform the covered transaction.”98

Thus, the NCR’s restrictions appear to be directed at restricting the participation in non-

procurement actions of individuals who enter into covered transactions or are in a position of

influence or control of federal funds or performance.

Whether the FAR should include guidance on how to handle an excluded individual,

follow a model like the NCR, or leave the issue to the corporate entity with which the individual

is associated, either as an officer, shareholder, director, manager, or lower-level employee, is

discussed further below.99

III. How Individuals May Find Themselves Subject to Suspension or Debarment

A. FAR Mandatory Disclosures

On November 12, 2008, the civilian and defense acquisition agencies that manage the

FAR issued the final version of FAR 52.203-13, a clause included in all contracts over $5.5

96 2 C.F.R. § 180.130. 97 2 C.F.R. § 180.980. 98 2 C.F.R.Id. at § 180.995 (emphasis added). 99 Infra Parts IV, V, VIADD CITE (supra to upcoming section)

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million and that require at least 120 days of performance.100 Under the clause, all contractors

must make timely disclosure to an agency Office of Inspector General (OIG) when, among other

things, a principal of the contractor has “credible evidence” of a violation of federal criminal law

involving fraud, conflict of interest, bribery or gratuity violations in Title 18 of the United States

Code or a civil False Claims Act (FCA), 31 U.S.C. §§ 3729-3733.101 Failure to make a timely

disclosure is a cause for suspension and debarment.102 For companies that are not small

businesses and for contracts that are not for commercial items, FAR 52.203-13 includes

minimum requirements for internal control systems.103 In addition to reiterating the timely

disclosure obligation and other controls, this FAR provision requires covered contractors to

establish internal mechanisms by which employees and subcontractors can report suspected

incidents of misconduct and monitoring or auditing capabilities to detect misconduct.104 In lay

terms: contractors are required to make avenues available, such as a phone hotline or website

page, for employees and third parties to report suspected misconduct, investigate those reports,

and if the misconduct is confirmed and falls within the disclosure requirement, report it to the

agency OIG.

The reporting or disclosure requirement from FAR 52.2013-13 is commonly referred to

as the “mandatory disclosure rule.”105 Although it covers several criminal violations, the

overwhelming majority of disclosures relate to FCA-type violations and the type of violations

that would implicate individuals over corporate entities.106 For example, the Department of

Defense OIG’s semiannual report to Congress covering the period of April 1, 2017, through

100 (a) 73 Fed. Reg. 67,064 (Nov. 12, 2008); (b) FAR 3.,1004(a).101 (a) FAR 52.2013-13(b)(3) and (b) FAR 52.2013-13 (c)(2)(ii)(F)102 (a) FAR 9.406-2(b)(vi) and (b) FAR 9.407-2(a)(8).103 FAR 52.203-13-(c).104 (a) FAR 52.203-13(c)(2)(C)(1) and (b) FARFAR 52.203-13(c)(2)(ii)(D). 105 FAR 52.203-13.ADD CITE (cite to FAR regulation mentioned in sentence)106 FAR 52.203.ADD CITE

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September 30, 2017, states that 74% of the contractor disclosures related to labor mischarging, a

violation that a corporate entity would naturally report but that is generally based upon the time

charging violations of individuals.107 Under the False Claims Act, there is no “minimum” or “de

minis” damage level, and Agency OIGs have not adopted a minimum dollar level for

disclosures.108 As a result, it is not uncommon for contractors to report all findings of

mischarging, regardless of the small number of hours or dollar value, based on internal reporting

and investigations, the scope of the FCA, and the breadth of the FAR mandatory disclosure

rule.109

Offices of inspector general also expect that individuals engaged in misconduct will be

specifically identified in contractor disclosures.110 For example, the DoD OIG’s guidance on

making mandatory disclosures instructs contractors, among other things, to provide the “names

of individuals involved and an explanation of their roles in the allegations and the relevant

periods of their involvement.”111 The Department of Commerce OIG provides similar

guidance.112 The General Services Administration and Department of Interior contractor

disclosure forms and websites also ask for the names of individuals involved in the reported

107 Dep’t of Defense Office of Inspector General, Semiannual Report to Congress: April 1, 2017 through September 30, 2017 (Dec. 1, 2017 Dep’t of Def. Office of Inspector Gen., Semiannual Report to Congress: April 1, 2017 through September 30, 2017 61 (2017).)108 See Dietrich Knauth, DOD Doesn’t Want Exemption for Small Fraud Disclosures, Law360, Sept. 29, 2014, http://www.law360.com/articles/580320/dod-doesn-t-want-exemption-forsmall-fraud-disclosures. 109 Id.ADD CITE110 Id.ADD CITE111 Dep’t of Defense Office of Inspector General, Contractor’s Guide to Submitting a Disclosure, at 9 (June 2017), available at: http://www.dodig.mil/Portals/48/Documents/Contractor-Disclosure/Contractor-Disclosure-Program-Guide-1-Jun-17.pdf?ver=2017-06-19-093259-387 (last accessed Jan. 10, 2018). 112 See, e.g., https://www.oig.doc.gov/Documents/FAR-disclosure.pdf (last accessed Jan. 11, 2018).

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misconduct.113 If a contractor omits this information, it is typical to receive a follow up request

for it, often with information about last known address or security clearance status.114

FAR mandatory disclosure reports are routinely routed both to suspension and debarment

officials and the Department of Justice.115 Because individuals engaged in misconduct that is the

subject of the report are generally identified, debarring officials and other enforcement entities

are presented with ready information to proceed against individuals.116

B. Prior Legislative and GAO Focus on Suspension and Debarment Practices

As some have pointed out, a prior legislative focus and GAO reports on the debarment

system generally may have contributed to the increase in exclusion actions, particularly against

individuals.117 According to sources cited by one author, contractor organizations were (and

perhaps still are) incentivized to “throw[] individuals to the wolves” to avoid an action against

the organization, and some believe that agencies have turned to exclusion of individuals in an

effort to increase the number of exclusion actions overall.118

113 (a) See Gen. Servs. Admin. Off. Inspector Gen., Contractor Reporting Form, https://www.gsaig.gov/content/gsa-oig-contractor-reporting-form; (b) Contractor Reporting Form, Office of Inspector General - U.S. Dept. of the Interior, https://forms.doioig.gov/contractorreport_form.aspx (last accessed Jan. 11, 2018).https://forms.doioig.gov/contractorreport_form.aspx (last accessed Jan. 11, 2018).114 Stu Nibley & David Nadler, Mandatory Disclosure for Government Contractors, 2014 Gov’t Conts. Year in Review Briefs 26, 9 (2014).ADD CITE115 ADD CITEId. at 3.116 ADD CITE117 (a) Equality, supra note 17, at 92. 45 Pub. Cont. L.J. at 92-94. (b) See also U.S. GOV’T ACCOUNTABILITY OFF., GAO-11-739, SUSPENSION AND DEBARMENT: SOME AGENCY PROGRAMS NEED GREATER ATTENTION, AND GOVERNMENTWIDE OVERSIGHT COULD BE IMPROVED (2011) [hereinafter GAO-11-739] (Agency OIGs have also audited and recommended improvements to suspension and debarment programs) See also U.S. Gov’t Accountability Office, GAO-11-739, Suspension and Debarment: Some Agency Programs Need Greater Attention, and Governmentwide Oversight Could Be Improved (2011); (c) U.S. Gov’t Accountability Office, GAO-09-174, Excluded Parties List System: Suspended and Debarred Businesses and Individuals Improperly Receive Federal Funds (2009). Agency OIGs have also audited and recommended improvements to suspension and debarment programs. (d) See, e.g., Dep’t of Agriculture, Implementation of Suspension and Debarment Tools in the U.S. Department of Agriculture, Audit Report 50016-0001-23 (Sept. 2017); (e) DOD, OFFICE OF INSPECTOR GENERAL, D-2011-083, ADDITIONAL ACTIONS CAN FURTHER IMPROVE THE DOD SUSPENSION AND DEBARMENT PROCESS (2011).Dep’t of Defense Office of Inspector General, D-2011-083, Additional Actions Can Further Improve the DoD Suspension and Debarment Process (July 2011).118 Equality, supra note 17, at 94-95 (citing Dietrich Knauth, Calls for Contractor Debarment Carry Political Appeal, LAW360 (May 13, 2013, 10:38 PM) http://law360.com/articles/440772/calls-for-contractor-debarment-carry-political-appeal).45 Pub. Cont. L.J. at 94-95.

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C. Department of Justice “Yates” Memorandum

On September 9, 2015, then-Deputy Attorney General Sally Q. Yates issued a

memorandum entitled, “Individual Accountability for Corporate Wrongdoing” to guide

Department of Justice attorneys handling corporate matters.119 As the title to the memorandum

suggests, the Yates Memo in premised on the belief that: “[o]ne of the most effective ways to

combat corporate misconduct is by seeking accountability from individuals who perpetrated the

wrongdoing.”120

The Yates Memo was intended to outline “six key steps” intended to ensure that

Department attorneys handle corporate investigations, both criminal and civil, consistently across

the Department.121 Relevant to how the Yates Memo might intersect with the suspension and

debarment system, some of the six outlined steps include: (a) to be eligible for cooperation

credit under the United States Attorney’s Manual and its Principles of Federal Prosecution of

Business Organizations (USAM 9-28.000 et seq.), corporations must provide the Department of

Justice with all relevant facts regarding individuals involved in corporate misconduct.122 The

Yates Memo provides that this requirement for cooperation applies equally for civil matters,

including under the False Claims Act, 31 U.S.C. § 3729(a)(2); (b) both criminal and civil

corporate investigations should focus on individuals from the inception of the investigation; (c)

absent extraordinary circumstances, no corporate resolution should provide protection from

criminal or civil liability for any individuals; (d) Department attorneys should not resolve

corporate matters without a clear plan to resolve cases involving individuals; and (e) civil

attorneys should “consistently focus on individuals as well as the company and evaluate whether

119 Memorandum from Sally Quillian Yates, Deputy Att’y Gen., U.S. Dep’t of Justice, to All U.S. Att’ys et al., Individual Accountability for Corporate Wrongdoing (Sept. 9, 2015) (hereinafter “Yates Memo”), available at: https://www.justice.gov/archives/dag/file/769036/download (last accessed AprJan. 153, 2018). 120 ADD CITE (Yates memo)121 Id.122 ADD CITE

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to bring suit against an individual based on considerations beyond that individual's ability to

pay.”123

D. Likely Impact

The Interagency Suspension and Debarment Committee (“ISDC”) was established

pursuant to Executive Order No. 12549 regarding government-wide suspension and

debarment.124 The ISDC’s mission is to serve as “a Federal forum to discuss Government-wide

non-procurement and procurement suspension and debarment related issues . . . , facilitate lead

agency coordination, and assist in developing unified Federal policy.”125 In addition, the ISDC

serves as a forum to discuss suspension and debarment issues, to provide training, and to share

best practices.126 The ISDC reports annually to Congress regarding the status of the suspension

and debarment system pursuant to Section 873 of Public Law 110-417 and, in doing so, provides

statistics on exclusion actions taken by Executive agencies.127 Since it began collecting data, in

fiscal year 2009, the ISDC reports a general increase in the number of exclusions by federal

agencies.128 Comparing statistics from 2009 to its most recent report for fiscal year 2016, the

ISDC reported that in fiscal year 2016, there were 718 suspension actions, 1855 proposed

123 Id.124 (a) Section 4 of Executive Order No. 12549Exec. Order No. 12,549, 3 C.F.R. § 181 (1986). Section 4 of the Executive Order on debarment and suspension directed the establishment of the ISDC. The Order directs Executive agencies to participate in a Government-wide system for debarment and suspension from programs and activities that involve federal funding; issue regulations with Government-wide criteria and minimum due process procedures to be given when considering debarment of suspension actions; and enter excluded parties on SAM. The ISDC also serves to coordinate lead agency identification when many agencies may be affected by a potential exclusion, provide training to agency debarring officials and their staffs, serve as a forum for discussion of issues relating to suspension and debarment, and assist in developing federal policy. (b) See Gen. Serv. Admin., About the ISDC, Acquisition.Gov, https://isdc.sites.usa.gov/ (last visited Jan. 2, 2018). -See https://isdc.sites.usa.gov/ (last accessed Jan. 2, 2018). 125 Id. 126 See ISDC Report to Congress, dated Jan. 12, 2017, available at: https://s3.amazonaws.com/sitesusa/wp-content/uploads/sites/272/2017/03/873-Report-FY-2016.pdf (last accessed Jan. 21, 2018) (“Over the past several years, the ISDC has placed particular emphasis on promoting best practices and on helping agencies with developing programs to leverage the experience of agencies with well-established programs.”) (hereafter “FY 2017 ISDC Report to Congress”).127 See, generally, id.128 David M. Sims & Lori Y. Vassar, FY16 Report by the Interagency Suspension and Debarment Committee on Federal Agency Suspension and Debarment Activities (2017).ADD CITE

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debarments, and 1676 debarments.129 In fiscal year 2009, by contrast, there were 417

suspensions of contractors, 750 proposed debarments, and 669 debarments.130 Although the

ISDC gathers information on the suspension and debarment of individuals, and instructs agencies

how they should “count” any exclusions of individuals,131 the ISDC provides overall figures for

suspensions, proposed debarments, and debarments by agency; it does not report on the

breakdown of these exclusions between individual and corporate entity contractors.

Practitioners, nonetheless, anecdotally have maintained that the increase in suspension

and debarment actions since 2009 is attributable to more exclusions of individuals (and small

businesses) than large corporate actors who might have the largest dollar value contracts or the

most repeat business with the United States.132 One attempt to discern the number of exclusions

of individuals for fiscal year 2017 relied on information reported in SAM.133 Although

admittedly imperfect,134 this analysis of SAM determined that nearly 800 individuals (793 to be

precise) had been excluded out of a pool of approximately 1,256 total exclusions.135 Thus,

approximately 63% of the exclusions in fiscal year 2017 appear to have affected individuals.136

With more individuals than other types of contractors affected, at least in recent years, it makes

sense to consider whether the FAR (and the NCR for that matter) should be revised to account

129 Id.ADD CITE130 See id. at 1. (look to ISDC report)131 See id. at 6 (look to ISDC report)132 See , generally, Equality, supra note 17..133 See David Robbins, Suspension and Debarment: FY 2017 By the Numbers, LAW 360 (Nov. 3, 2017), https://www.crowell.com/files/20171103-Suspension-And-Debarment-FY-2017-By-The-Numbers.pdf., Law360, Nov. 3, 2017.134 See id. Mr. Robbins provides a “few important caveats” to the data he analyzed, including the fact that some agencies, such as the General Services Administration, is listed twice as an excluding agency, some agencies include numerous aliases and spelling variations for individuals, and inactive agencies are excluded.135 See id. Mr. Robbins explains that the Department of Navy appears to include multiple spelling variations for the names of individuals entered into SAM. Attempting to account for those duplicate entries for the same individual reduced the number of actions taken against individuals from 1,415 to 793.136 Id. If the raw numbers Mr. Robbins analyzed are used, not corrected for the Navy’s practice of listing multiple aliases, the overall percentage of actions against individuals as compared to exclusions overall is 75%. Id.

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for the differences between an individual and corporate actor when it comes to suspension and

debarment.

IV. Application of the FAR to Individuals and a Hypothetical

As discussed above, the FAR’s guidance regarding the effect of exclusion in FAR 9.405

is largely unhelpful when trying to determine what an individual listed as excluded in SAM can

and cannot do in the government contracting arena.137 This vacuum is undoubtedly relevant for

those individuals who own or control companies that do business with the Government, but the

void is arguably more troublesome for individuals who may not be in a position to control a

corporate organization, but nonetheless are employed in the government contracting industry.

With respect to the former category of individuals – owners, shareholders, officers, and

executives – there may be a reason for insulating the corporate entity (and thus the United States)

from the influence or control of such debarred individuals. Especially when the contractor

organization can be deemed responsible “but for” the conduct of such owners or executives,

agencies take different approaches based on preferences, experience, or the facts of the case.138

For owners of closely-held businesses, for example, some debarring officials have required a

debarred owner to refrain from serving in a position of influence or control over the organization

and even to place his or her interests in a form of trust, with an independent, presently-

responsible trustee, to ensure that the individual is truly separated from the company financially

and operationally while excluded.139 Some owners have simply sold the business rather than try

to hew to restrictions that would be imposed.140

For implicated officers or directors, some agencies have approved a change in

management of the organization or specific removal of the excluded individual from any position 137 See id.ADD CITE (supra to section discussing this above)138 ADD CITE139 ADD CITE140 ADD CITE

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of operational control.141 These types of arrangements may be implemented through an

administrative agreement, both with the individual and the organization, to allow the

organization to remain “off” the SAM excluded party list and able to do business with the

Government.

None of these “remedies” appears in the FAR. They have arisen on case-by-case bases,

based on the facts of each case, through sharing of administrative agreements, or sharing of best

practices through organizations like the ISDC.142 Although word-of-mouth and anecdotal

experience is helpful, a reasonable question is whether the FAR or NCR, and the debarment

process as a whole, would be improved by acknowledging the options available in a toolbox or at

least the possibility an organization can retain its present responsibility status by insulating itself

from the influence and control of a debarred individual who has the ability to control or influence

it.

So, whereas an argument can be made that an individual who has the ability to influence

and control an organization, whether in their role as a major or sole shareholder, director, or

officer, should be “excluded” from influencing and controlling the organization for the

organization to remain responsible, the argument becomes murkier and more complicated as one

proceeds down the organizational “chain of command.”

Consider this hypothetical scenario:

Connie Contractor is a financial analyst who has been employed for three years by a mid-sized contractor that provides accounting and other financial consulting services to commercial and government customers. Connie works on site at a Government facility.

As a result of a finding of misconduct relating to 42 hours of mis-reported time arising from an internal investigation conducted by her prior employer, Connie’s

141 ADD CITE142 ADD CITE

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employment was terminated from her prior job, and the mischarging was reported to an agency office of inspector general pursuant to FAR 52.203-13.143

Two and a half years after the disclosure, and after she has secured employment with her current employer, Connie receives a notice of proposed debarment.

Connie is not an owner, shareholder, officer, director of her current or prior employer, nor was she or is she a manager of other employees. She has worked in the federal sector her entire working career.

Upon issuance of the notice of proposed debarment, Connie is immediately listed on SAM’s excluded party list – even before she has received the notice.

When Connie informs her supervisor of the notice, she is terminated from her employment with the mid-sized accounting and financial consulting firm.

This scenario raises a host of questions and, unfortunately, it is not uncommon.

So what questions arise? A threshold question is why it is necessary at all to exclude

Connie Contractor -immediately – from contracting to “protect” the Government’s interests144,

even before considering a response from her? There are no criteria for making this threshold

determination in the FAR. This is so whether the party being considered for exclusion is a

corporate organization or an individual.

But for an individual, at least one former SDO believes that the default position should be

an action short of exclusion.145 As a matter of experience and through training by the ISDC,

more debarring officials are refraining from taking immediate actions that would result in an

exclusion by, for example, issuing requests for information, show cause notices, or even less

formal communications expressing concerns regarding (usually) a corporate entity’s or

individual’s present responsibility.146 These practices have developed precisely because it is not

always necessary to exclude an entity or individual from contracting with the United States

143 ADD CITE144 ADD CITE (FAR outlining the purpose of debarment)145 Telephone Interview with Rodney A. Grandon, Affiliated Monitors, Inc. (January 18, 2018).Grandon Interview.146 ADD CITE

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immediately.147 But, none of these less draconian options appear in the FAR or the NCR

(although, again, proposed debarment under the NCR, unlike the FAR, does not lead to

immediate exclusion). Although some argue that SDOs should have flexibility to employ a

variety of “tools” to address present responsibility issues,148 and so these alternative means of

initiating an inquiry into present responsibility do not need to be codified, it is hard to see why

they should not. The tools listed in the FAR need not, nor should they, be an exhaustive or

exclusive list; rather, they would be examples of approaches, short of immediate exclusion, that

an SDO could consider on a case-by-case basis.

A reasonable argument can be made that when deciding this threshold issue of imminent

harm to the United States, there should be some basis for believing the individual, based upon

her role in the alleged misconduct, the timing of the action, and her position in the organization

in which she is employed, could actually “harm” the United States, such that immediate

exclusion is appropriate, or might not be an immediate threat and so additional information

gathering might be appropriate. Moreover, listing the options that an SDO should consider

before suspending or proposing an entity or individual for debarment does not “box in” an

SDO’s decision-making any more than the consideration of the mitigating factors in FAR 9.406-

1.149 In other words, the tools in the toolbox can be identified so that all participants in the

system know about them without dictating the tool that must be used, if for no other reason than

to give an SDO cover if he or she chooses to employ one and is later questioned.

The next question is whether Connie’s employer really needed to terminate her

employment, either before she has responded or even if eventually excluded. On the one hand,

many government contractors have policies in place that state that they will not hire someone

147 Equality, supra note 17, at 83.ADD CITE148 ADD CITEId. at 96-97.149 ADD CITE (FAR mitigating factors)

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who has been suspended, proposed for debarment, or debarred.150 Contractor organizations also

terminate employees under their disciplinary policies and to ensure that the entity itself, should

the bright light of the SDO’s office turn in its direction, can tell the SDO that it took appropriate

discipline and is itself presently responsible.151 As the Suspension and Debarment Official for

the Environmental Protection Agency and former Vice-Chair of the ISDC, Duc H. Nguyen

points out, an adverse employment action, such as a termination, may be a collateral

consequence of an exclusion, exercised at the contractor’s discretion, and therefore one that the

Government does not (and should not) control.152

On the other hand, the FAR is specifically meant not to “punish” contractors but solely to

protect the United States.153 In addition, the FAR allows the Government to continue contracts in

place with contractor entities that have been excluded.154 Why, then, should a different rule

apply to an individual, such that they are almost always terminated if they inform their employer

of their exclusion? To be sure, the contractor entity is operating pursuant to a contract, and it is

very likely that Connie is not. And, there are labor law issues that are certainly beyond the scope

of this article. Still, individuals like Connie may not automatically find themselves terminated,

and unlikely to land a job in the government contracting industry (before they have even had an

opportunity to present their case to an SDO) if the FAR acknowledged that a corporate

contractor should consider (i) whether an excluded individual is in a position of influence or

control over the performance of a government contract; (ii) whether an individual can be re-

assigned so that they cannot exercise such influence or control; (iii) whether the individual can

perform work in a commercial sector while excluded, or (iv) other relevant factors.

150 ADD CITE151 ADD CITESchoeni, supra 17, at 64-67. 152 Telephonic Interview withof Duc H. Nguyen, Suspension and Debarment Official, Environmental Protection Agency (Jan.uary 25, 2018) (hereafter “Nguyen Interview”) (on file with author).Nguyen Interview. 153 FAR 9.402(b)154 FAR 9.405-1(a).

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These issues are thorny, but the FAR today is essentially a vacuum. The FAR Council155

(or other appropriate body if the FAR and NCR were to be taken up together) . could initiate a

rulemaking, accept comments from government, industry, and labor law experts, and consider

whether guidance can be provided that recognizes that not every employee noticed for proposed

debarment, or even excluded, should automatically be terminated and effectively precluded from

earning a livelihood in the government contracting industry. The FAR could recognize that it

does not require termination, at a minimum.

With respect to the business owner, director, or executive, there is more of a track record

of how to act, even if it is not set forth in the FAR. Administrative agreements for corporate

actors sometimes require that an implicated owner or director is removed from a position of

influence or control156 or, in the case of a closely-held business where the implicated individual is

a major, active shareholder, SDOs have required the implicated owner to put her shares into a

voting trust with an independent trustee, again as a means of avoiding the implicated individual

from exercising influence or control over the organization.157 For the same reasons as discussed

above, it would make sense to amend the FAR to state that when an individual has been

suspended, proposed for debarment or debarred, she should not be in a position to exercise

155 The FAR Council was established to assist in the direction and coordination of Government-wide procurement policy and Government-wide procurement regulatory activities in the Government, in accordance with the Office of Federal Procurement Policy (OFPP) Act, 41 U.S.C.§ 421. The FAR Council manages, coordinates, controls, and monitors the maintenance and issuance of changes in the FAR. See https://obamawhitehouse.archives.gov/omb/procurement_far_council (last visited Jan. 31, 2018). The FAR Council is made up of representatives from the Department of Defense, the National Aeronautics and Space Administration, and the General Services Administration. 156 Administrative Combliance Agreement Between U.S. Gen. Serv. Admin. and Symplicity Corp. 1, 12 (Jan. 7, 2016) [hereinafter Symplicity Agreement]ADD CITE157 (a) Symplicity Agreement, supra note 156, at 22.ADD CITE (for the SDO information) (b) Nguyen Interview. Mr. Nguyen does not agree with this type of administrative agreement provision. In his view, a contractor should be taking such steps voluntarily if necessary to demonstrate its present responsibility. He also opines that it may be inappropriate for the Government to dictate employment arrangements or inject itself into personnel and management decisions that are central to corporate governance.

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influence or control over the contractor organization. How to achieve that “protection” can

differ on a case-by-case basis.

When Connie Contractor presents her story in opposition to the proposed debarment,

what factors should an SDO consider? As set forth above, the “mitigating factors” in FAR

9.406-1 are, at best, inelegant when applied to individuals and, at times, not applicable at all.158

Furthermore, an individual may have personal circumstances that are either mitigating or

even aggravating but would never apply to a corporate actor. For example, should the fact that

Connie was going through a messy divorce at the time of the mischarging be a factor or that she

had a hospitalized child? Would it matter that Connie had been disciplined in the past for similar

(or dissimilar) conduct? Is it relevant that Connie’s supervisor encouraged mischarging to

increase her own performance metrics? Or, is it relevant that Connie had a substance abuse issue

and subsequently received treatment such that she is in place of recovery? Would it matter if

Connie had served in the military with distinction? Does it matter if Connie has received

pastoral counseling that has led her to become more involved in her church? These factors might

be relevant on a case-by-case basis to assess whether Connie, two years later, is “presently

responsible” but are very different from what is currently in the FAR.159

Although not advocating changes to the FAR to address individuals, Mr. Nguyen, posits

that if changes are contemplated, the FAR Council should avoid creating a list of “factors.”160

Rather than creating a “check list,” he proposes broad considerations that establish a flexible

framework that includes four broad categories: what happened and how was the contractor

involved; was the misconduct preventable; what was the immediate response to the misconduct;

158 ADD CITE (FAR 9.406-1.)159 Id.ADD CITE160 Nguyen Interview.Telephonic Interview of Duc H. Nguyen, Suspension and Debarment Official, Environmental Protection Agency (January 25, 2018) (hereafter “Nguyen Interview”) (on file with author).

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and what steps has the contractor taken to prevent a recurrence.161 Whether “list” or

“framework,” I would advocate for the inclusion of a “catchall” to capture any other facts that

might reflect on a person’s present responsibility (or a corporate entity’s, for that matter).

There is some merit to this approach because it would allow for flexibility and could be

applied to both corporate actors and individual persons. As applied to the Connie Contractor

hypothetical, these three primary considerations that would encompass many concepts used to

assess present responsibility:

What was the misconduct and what was the individual’s role in that misconduct

o This consideration would encompass inquiries from the NCR such as whether and to what extent Connie Contractor planned, initiated, or carried out the wrongdoing, and her position in the organization (including, for example, her relationship to those around her who might have either encouraged misconduct, turned a blind eye to misconduct).162

Was the misconduct preventable?

o Was the misconduct knowing and intentional or was Connie Contractor negligent or uniformed? Did Connie have adequate training such that she knew or should have known that her conduct was wrong. Alternatively, was Connie’s training absent or inadequate?

What was the immediate response to the misconduct?

o When confronted with the allegations or fact of misconduct, how did Connie respond? Did she accept responsibility or otherwise express remorse and an understanding that what she did was wrong? Did she lie? Did she try to cover up the misconduct? Did she cooperate with her employer’s investigation?

o This would also capture some of the FAR concepts like whether sufficient time has passed since the misconduct, whether any personal or exigent circumstances that might have contributed to the misconduct are or are no longer present,163 Connie’s position today and her record of compliance (or non-compliance) at her current job. For Connie or even someone who might have faced a more severe penalty, such as criminal prosecution and

161 ADD CITE (interview)Id.162 ADD CITE163 ADD CITE (likely from the FAR)FAR 9.406-1.

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sentencing, what has the individual learned from the experience? How is Connie (or the criminally prosecuted) different today?

What steps did the contractor take to prevent recurrence?

o Did Connie proactively take classes or training to help her understand the technical requirements of her job? Did she take all the training necessary to ensure future compliance? Did she take ethics training tailored to her field or industry?

Are there any other circumstances that reflect on the individual’s present responsibility?

The benefit of a short, broad list of considerations, versus a list of “factors,” is that it

provides maximum flexibility to consider the wide variety of facts that might touch on an

individual’s present responsibility. A shorter set of considerations would provide a structure as

opposed to a list in the model of FAR 9.406-1, with the goal of having an SDO consider more

than just the listed 10 factors.164

Former Air Force SDO and former Vice-Chair of the ISDC, Rodney A. Grandon,

however, believes that a set of factors for individuals in the FAR, similar to those currently in

place that have more direct applicability to business entities, would be appropriate so as to

promote consistency and predictability in the debarment process.165 In addition, an SDO decision

made in accordance with a detailed framework may make judicial review easier and less subject

to variance by reviewing courts.166 Furthermore, if there is turnover in the SDO position or staff,

a list of factors likely lessens the learning curve.167

If a more detailed list were to be developed, relevant factors might include the following:

What was the individual’s role in the misconduct and position at the time of the misconduct

164 ADD CITE 165 Interview with Rodney A. Grandon, supra note 145.Telephonic Interview with Rodney A. Grandon, Affiliated Monitors, Inc., held January 18, 2018 (hereafter “Grandon Interview”) (on file with author).166 Id. 167 Id.ADD CITE

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What is the impact to the United States of the misconduct

o This is an NCR consideration, and it makes sense.168 Determining whether someone presents such a risk to the United States that they should be excluded from contracting with the Government should include an assessment of the seriousness of their misconduct, including its impact

Whether the individual had adequate training or experience such that she knew or should have known that her conduct was improper

Whether the individual has a pattern of wrongdoing or has been disciplined in the past for misconduct

Whether the individual cooperated with any investigations of the misconduct

Whether the individual has taken remedial measures to prevent a recurrence of the misconduct

Whether the individual understands the seriousness of the misconduct and expresses remorse

Whether there are any other circumstances that reflect on the individual’s present responsibility

o Whether “structure” or “factors,” there should be a catch all to capture considerations that may be unique to each case and individual set of facts.

Both the “framework approach” and “set of factors” positions have merit. Regardless,

because the existing mitigating factors do not apply well to individuals, and some factors, even if

broad, would help individuals in responding to notices of potential exclusion, changes to the

FAR should be considered to recognize that individuals present a necessarily different set of

issues to consider.169 In addition, given the myriad individual circumstances, it would make

sense for any regulatory provision to include a “catch all” factor, similar to the catch-all grounds

in FAR 9.406-2(c) and FAR 9.407-2(c), that allows an SDO to consider “any other facts that

might bear on an individual’s present responsibility.”170

168 Id.ADD CITE169 See also EqualityEquality, supra note 17, at 96 (“Regulations should give SDOs and individual contractors more clarity up front in the form of mitigating factors that are more readily applicable to individuals. This would increase predictability and provide meaningful options to contractors facing proposed debarment, avoiding a mere ‘arms race of how many training classes [the contractor] can take’ to show present responsibility.”)170 (a) FAR 9.406-2(c). (b) FAR 9.407-2(c)-2(c)3(e)(1).

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Finally, this article has referred to “administrative agreements,” although FAR Subpart

9.4 references them only elliptically.171 Would such an agreement be appropriate for Ms.

Contractor? While an SDO, Mr. Grandon preferred more informal “letter agreements” if his

office wanted an individual respondent to commit to certain measures.172 Mr. Nguyen believes

that administrative agreements may be appropriate for some, but not necessarily all, individuals

faced with an exclusion, just as not all corporate contractors are appropriate candidates for such

an agreement.173

As defined by the ISDC, an administrative agreement is “a document that is ordinarily

negotiated after the recipient has responded to a notice of suspension or proposed debarment.” 174

The option of entering into an administrative agreement is “solely within the discretion of the

SDO, and will only be used if the administrative agreement appropriately furthers the

government’s interest.”175 According to the ISDC, although administrative agreements vary

according to an SDO’s concerns regarding each respondent, “these agreements typically mandate

the implementation of several provisions to improve the ethical culture and corporate governance

processes of a respondent in a suspension or debarment proceeding.”176 In addition,

“[a]greements may also call for the use of independent third party monitors or the removal of

171 (a) FAR 9.406-3(f). (b) 9.407(e)(1). Without actually defining what an administrative agreement is, its intent, or purpose, FAR 9.406-3(f) and 9.407(e)(1) instruct SDOs that if a contractor enters into an administrative agreement with the Government in order to resolve a suspension or debarment proceeding, the debarring official shall post the agreement on the Federal Awardee Performance and Integrity Information System (FAPIIS) within three working days. Despite the increased use of administrative agreements, these are the sole references to administrative agreements in Subpart 9.4. (c) But see 48 C.F.R. § § 1409.406-3 and (d)1409.407-3 (Department of Interior FAR Supplement, describing an administrative agreement as follows: “Administrative Agreements. Matters may be resolved through an administrative agreement at any stage of proceedings in resolution of a [suspension or debarment] action where a contractor agrees to appropriate terms. The specific effect of administrative agreements that incorporate terms regarding eligibility for [Department of Interior] contracting will vary with the terms of the agreements. In general, such agreements resolve [suspension or debarment] concerns and thereby terminate award ineligibility.”)172 Interview with Rodney A. Grandon, supra note 145.Grandon Interview.173 Nguyen Interview. 174 FY 2017 ISDC Report to Congress at 5.175 Id.176 Id.

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individuals associated with a violation from positions of responsibility within a company.”177

Pursuant to FAR 9.406-3(f), administrative agreements are posted publicly in the Federal

Awardee Performance and Integrity Information System (FAPIIS) database.178

As the ISDC definition reveals, even administrative agreements are most often

considered with an eye towards a corporate actor – by referencing monitors and improvements to

corporate governance. Some agencies, however, have used administrative agreements to allow

individuals to avoid exclusion.179 Mr. Grandon, when the Air Force SDO, preferred “letter

agreements” with individuals whereby the individual would agree to undertake certain actions as

a condition of having an exclusion lifted.180 The benefit of a letter agreement is that the

document can be scoped to address limited measures appropriate for an individual – measures

that different significantly than those that would be appropriate for a business entity, as currently

contemplated by policy and practice, and it is not necessarily posted to FAPIIS; the downside,

according to some, is that a “letter agreement” is an administrative agreement in all but name.181

It would make sense, generally, for the FAR Council to consider revisions to the FAR to

recognize the existence and purpose of administrative agreements. The Council could then

consider whether administrative agreements or some other mechanism – periodic reporting to the

SDO, providing information on training taken, or simply staying out of trouble – should be

considered for individuals.

V. A Call for Change Part I: Addressing Individual Exclusion Only (One Small Step)

There is a downside to a “patchwork” approach to amending the FAR, but given the gaps

that exist today, one first step would be for the FAR Council to initiate a rulemaking to consider

177 Id. 178 FAR 9-406.3(f).ADD CITE179 ADD CITEGrandon Interview, supra note 165.180 Interview with Rodney A. Grandon, supra note 145.Grandon Interview. 181 Id.

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revisions to the FAR that more directly and appropriately address the unique circumstances of an

individual facing exclusion. Potential changes, discussed above, are summarized below. If the

FAR Council were to undertake a rulemaking, however, it (or other regulators) may wish to

consider a broader action that these proposed changes suggest. Those global issues are discussed

in the next section.182

(The One Small Step Approach) Changes to Address Individuals. Undertake a

rulemaking to consider more specifically:

When it might be necessary to immediately exclude an individual to protect the interests of the United States and, by corollary, when it may be more appropriate to take interim action that does not result in immediate exclusion. Here, the FAR Council could consider the suggestion made by Mr. Grandon that the default position for individuals should not be immediate exclusion and SAM listing or it could consider the alternatives available or the NCR proposed debarment posture;183

What an exclusion means for an individual with respect to employment, bearing in mind the policy that debarment is not meant as punishment and concepts of influence or control;184

The factors (mitigating or aggravating) that an SDO should consider to assess whether an individual is presently responsible and whether those factors should be a broader set of considerations or a more specific list, similar to FAR 9.406-1;185

That an individual need not respond through counsel to present its opposition;

Whether administrative agreements or some other mechanism might be appropriate as a resolution in lieu of exclusion for an individual.

Although this article advocates generally for consideration of changes to the FAR to

provide more guidance to individuals, practitioners, and the suspension and debarment

community for addressing the exclusion of individual persons, this is not a universally-held

belief. Mr. Nguyen, for example, believes that the existing rules, combined with internal policies

182 ADD CITE (supra)See supra Part IV.183 Interview with Rodney A. Grandon, supra note 145.ADD CITE (grandon interview)184 ADD CITE (FAR 9.402.)185 ADD CITE (FAR 9.406.1.)

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and ISDC training, are sufficiently robust that SDOs can address the circumstances of an

individual.186

VI. A Call for Change Part II: If the FAR Suspension and Debarment Provisions are to

be Amended, Go Big

If the FAR Council (or other regulator) were to initiate a rulemaking, it makes sense to

consider broader changes to the FAR, not limited to exclusion of individuals, since some of the

changes recommended above rely on concepts and practices not currently defined by regulation

(or at least by the FAR). Messrs. Grandon and Nguyen would endorse a complete overhaul that

establishes one set of suspension and debarment rules, as opposed to the bifurcated FAR and

NCR, although which proponent in Government would champion this combined set of rules is an

open question.187 A single suspension and debarment regime has appeal. First, as noted above,

the FAR and NCR provide reciprocal treatment for an exclusion under either set of rules; this

argues in favor of one set of rules.188 Second, eliminating potentially duplicative regulations, or

combining two sets of regulations into one, would be consistent with the Administration’s

Executive Order No. 13771, “Reducing Regulation and Controlling Regulatory Costs,” which

instructs agencies to eliminate two regulations for every one adopted.189 Third, a combined

system would promote uniformity and consistency and would be easier for SDOs, their staff,

practitioners, and contractors to learn. Fourth, the NCR has many valuable concepts that are not

186 Nguyen Interview. 187 (a) Interview with Rodney A. Grandon, supra note 145Grandon Interview; (b) Nguyen Interview;. (c) See also Robert F. Muenier and Trevor B. A. Nelsona, “Is It Time For A Single Federal Suspension And Debarment Rule?,” 46 Pub. Cont. L.J. 553, 587 (Spring 2017) (analyzing, but not advocating for or opposing, a single Uniform Suspension and Debarment Rule).188 FAR 9.401. ADD CITE (FAR and NCR that shows similar treatment)189 Exec. Order No. 13771, Reducing Regulation and Controlling Regulatory Costs, issued on Jan. 30, 2017, 82 Fed. Reg. 9339 (Feb. 3, 2017).

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unique to the nonprocurement world and could benefit the procurement system, but this overhaul

is beyond the scope of this article (other than to acknowledge the suggestion and its appeal).

Assuming no uniform FAR/NCR, if the FAR Council were to open a FAR Case to

address the circumstances of individuals, it might as well consider a broader slate of

improvements and updates to FAR Subpart 9.4. I recommend that the FAR Council consider

these additional topics in a rulemaking:

(The Go Big Approach) Changes to FAR Subpart 9.4 (overall). Undertake a rulemaking

to consider an overall update to Subpart 9.4 that addresses:

Recognize the “informal” practice of using actions short of exclusion when there are concerns regarding present responsibility, such as requests for information, show cause notices, or simple letters of concern, but not an immediate need to suspend a contractor. Indeed, the ISDC reports that it encourages its members to consider, as appropriate, “alternative tools to promote contractor and participant responsibility that do not necessarily require or result in the imposition of suspension or debarment.”190 These tools allow an agency to develop information to better assess the risk to the Government and determine what measures, if any, are necessary to protect the Government’s interest “without immediately imposing an exclusion.”191 Given that the ISDC encourages the use of these alternatives,192 they should be recognized in the FAR. At a minimum, this would give those alternatives regulatory gravitas. It would also assist with fostering more continuity in practice between agencies and in the event of turnover in an SDO office. As an aside, if the FAR were to be combined with the NCR and adopt the NCR rule that a proposed debarment does not result in an automatic and immediate exclusion, the need for recognizing these alternatives would be less immediate.

Revising the procedures in FAR 9.406-3 and 9.407-3 to recognize that many, if not most, SDOs address exclusion proceedings informally through information exchanges or in-person meetings as opposed to hearings.193

Whether there should be modifications to the mitigating factors in FAR 9.406-1.194 In addition to considering factors relevant to individuals, it might make

190 FY 2016 ISDC 2016 Report to Congress, supra note 126, at 2ADD CITE191 Id.ADD CITE192 ADD CITE193 (a) Todd J. Canni, Shoot First, Ask Questions Later: An Examination and Critique of Suspension and Deabrment Practice Under the FAR Including a Discussion of the Mandatory Disclosure Rule, The IBM Suspension and Other Noteworthy Developments, 38 PUB. CONT. L.J. 547, 551 n.9 (2009)ADD CITE FAR 9.406-3; (b) FAR 9.407-3.ADD CITE 9.407-3194 FAR 9.406-1.ADD CITE

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sense to revisit the existing mitigating factors since the passage of FAR 52.203-13, which as discussed above requires many contractors to have internal control systems and make required disclosures.195 It might also be appropriate to include a “catch all” mitigating factor, as discussed above, and to consider whether the FAR should include aggravating factors, similar to the NCR.

What an administrative agreement is, its purpose, and that each administrative agreement should be tailored to the circumstances of each respondent. Unlike some who have proposed that the FAR should define specific provisions for an administrative agreement,196 regulatory “terms” are neither warranted nor appropriate. Every respondent is different and the needs, resources, and existing compliance framework of contractors differ dramatically. Moreover, the FAR should retain flexibility to change with time and as experience under administrative agreements evolves.

VII. Conclusion

The time is ripe to consider modifications to the FAR to address more directly the

circumstances of an individual facing suspension or debarment. With more individuals than

organizations facing potential exclusion, the rules should address the differences that are present

when assessing the risks that a single individual presents to the Government than an

organizational actor and how an individual actor could reasonably establish present

responsibility, even if cause for debarment might exist. While doing so, regulators should take

the opportunity to acknowledge some of the informal practices used by agency SDOs and to

consider abandoning the dual set of exclusion regulations in the FAR and NCR.197 Although

experienced, mature SDO programs may operate well with the current combination of the FAR

rules, discretion, agency-specific policies, and informal use of best practices when considering

an individual’s exclusion, members of the public, particularly those coming into contact with the

debarment system for the first time and potentially facing exclusion, are left out of that loop.

195 ADD CITEFAR 52.203.13.196 See Equality at 97.Equality, supra note 17, at 97. 197 ADD CITE

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It may be that a flexible approach wins the day over a set of regulations, and it may be

that some issues cannot and should be “regulated” by the Government, but the debarment system

will not advance, and individuals will continue to face correctable ambiguities in the process, if

we do not even consider the possibility of improvements.

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