The recently revised DoD Directive 5106.01 which sets forth the responsibilities of the Inspector General, DoD, designates the Inspector General DoD as the initial point of contact of possible fraud in connection with DoD contracts.  While the IG had this responsibility since July 1986, pursuant to direction from Deputy Secretary of Defense Taft, it had never been set forth in a DoD Directive until April 2006.

Defense contractors are encouraged to report potential criminal or civil fraud matters they identify through their self-governance efforts.  Matters that are purely administrative in nature should be presented to the appropriate contracting officer or a Defense Contract Audit Agency auditor.

The policy of encouraging companies to disclose potential misconduct and violations of the law is expressed in a number of Government policy issuances including Federal Acquisition Regulation 9.406-1, Defense Federal Acquisition Regulation Supplement 203.7001(a)(6), Chapter 8 of the Federal Sentencing Guidelines, the January 20, 2003 , memorandum of the Deputy Attorney General Thompson, “Principles of Federal Prosecution of Business Organizations”, and now DoD Directive 5106.01.

When a company makes a fraud disclosure and requests admission to the Voluntary Disclosure Program, the OIG will conduct an initial inquiry to confirm that the disclosure is voluntary, prepare a Voluntary Disclosure Agreement admitting the company to the Voluntary Disclosure Program, and oversee investigative and remedial action.  The Voluntary Disclosure Guidelines describe in detail the responsibilities and expectations of the Government and the company with respect to voluntary disclosures.

To see a copy of the DoD Voluntary Disclosure Program Guidelines click (here).