NOTE: This list of questions and
answers is merely an attempt to summarize the applicable standards to a
suspension or debarment action. It is not intended to create any right or
benefit, substantive or procedural, enforceable at law by a party against
the USDOT, Its operating administrations, its officers, or any persons. In
determining the applicability of, and rights under, any suspension or
debarment, refer to the applicable regulations at 49 C.F.R. PART 29 OR 48
C.F.R. SUBPART 9.4 as appropriate.
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What is
a suspension?
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What is
a debarment?
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What is
the purpose of suspension and debarment?
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Is
suspension and debarment punitive?
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What
type of conduct will lead to a suspension?
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What
type of conduct will lead to a debarment?
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How are
suspensions and debarments initiated?
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How do I
respond to a suspension or debarment notice?
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What
rights do I have if I am suspended or proposed for debarment?
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May I
have legal representation if suspended or proposed for debarment?
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What
types of information does the suspending official consider in a deciding
whether to terminate or modify a suspension?
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What
types of information does the suspending official consider in a debarment
proceeding?
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How long
is the term of debarment?
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How long
is the term of suspension?
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When
does a suspension take effect?
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When
does a debarment take effect?
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May an
agency settle an actual or potential suspension or debarment?
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What is
the effect if my company is suspended or debarred?
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What is
the effect on a company if a principal?
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What is
the effect on an individual if suspended or debarred?
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How does
a State or Federal agency or local government know if a person or company
is debarred?
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What
happens if I do business with a person or company that has been suspended
or debarred?
Q1. What is a suspension?
Answer: A suspension is an action taken by a suspending official that
excludes or disqualifies a person or company from bidding on, receiving, or
participating in Federally funded contracts or grants for a temporary period
of time pending the completion of an investigation or legal or
administrative proceedings. A suspension has government wide effect applying
to all Federal programs and procurement.
Q2. What is a debarment?
Answer: A debarment is an action taken by a debarring official that excludes
or disqualifies a person or company for a specific period of time, generally
not longer than 3 years. A debarment has government wide effect applying to
all Federal programs and procurement.
Q3. What is the purpose of
suspension and debarment?
Answer: The purpose of suspension and debarment is to protect the integrity
of government programs by ensuring that only honest, ethical, and otherwise
responsible persons and companies participate.
Q4: Is suspension and debarment
punitive?
Answer: No. Suspension and debarment are not punitive. Instead, suspension
and debarment are remedial intended to ensure that only responsible persons
and companies participate in government programs.
Q5: What type of conduct will
lead to a suspension?
Answer: The most common basis for a suspension is an indictment for a crime.
Such offenses may include fraud, antitrust violations, forgery, bribery,
falsification of records, making false statements, making false claims,
conspiracy, failure to comply with applicable environmental requirements
(such as the proper storage, transportation, and disposal of hazardous
waste), failure to pay the predetermined minimum wage, and other offenses
indicating a lack of business integrity or business honesty that seriously
and directly affects a person's or company's present responsibility. In
addition to an indictment, a person or company may be suspended whenever the
agency has other adequate evidence to suspect that a crime or some other
serious cause that affect a person's of company's present responsibility may
have occurred.
Q6: What type of conduct will
lead to a debarment?
Answer: The basis for a debarment can be for either a conviction or a civil
judgment. Criminal convictions that lead to a debarment may include fraud,
antitrust violations, forgery, bribery, falsification of records, making
false statements, making false claims, conspiracy, failure to comply with
applicable environmental requirements (such as the proper storage,
transportation, and disposal of hazardous waste), failure to pay the
predetermined minimum wage, and other offenses indicating a lack of business
integrity or business honesty that seriously and directly affects a person's
or company's present responsibility. Civil judgments that lead to a
debarment typically include qui tam actions for making false claims under
the False Claims Act, 31 U.S.C. 3729 et seq. In addition to a civil judgment
or conviction, a person or company may be debarred whenever the agency can
show by a preponderance of the evidence that some other serious cause that
affect a person's of company's present responsibility has occurred.
Q7: How are suspensions and
debarments initiated?
Answer: Suspensions and debarments are initiated by sending notice to the
person or company that is suspended or proposed for debarment.
Q8: How do I respond to a
suspension or debarment notice?
Answer: You may respond to a suspension or debarment notice either in person
or in writing, or both. However, any information that is provided orally you
consider important for the suspending or debarring official's consideration
must also be submitted in writing for the record.
Q9: What rights do I have if I
am suspended or proposed for debarment?
Answer: If you are suspended or proposed for debarment, then, within 30 days
after receipt of the notice, you have the right to respond in person, in
writing, or both. However, any information that you provide orally and
consider important for the suspending or debarring official's consideration
must also be submitted in writing for the record. Additionally, in cases
that are not based on an indictment, conviction, or civil judgment, and
where the suspending or debarring official determines that your response has
raised a genuine dispute over facts material to the suspension or proposed
debarment, you have the right to a separate fact-finding proceeding at which
you may present witnesses, documents, and other evidence as to the material
facts that the suspending or debarring official has identified as being in
dispute.
Q10: May I have legal
representation if suspended or proposed for debarment?
Answer: Yes. You may have legal representation if you are suspended or
proposed for debarment. However, the government is not obligated to provide
legal representation to you. If you desire legal representation, you must
retain your own representation at your expense.
Q11: What types of information
does the suspending official consider in a deciding whether to terminate or
modify a suspension?
Answer: In a suspension proceeding, the suspending official will consider
any relevant information. Such information may include information that
addresses the government's immediate interests that are at risk. If a
respondent can demonstrate that protective action has been taken to
eliminate, or reduce to an acceptable level, the government's risk pending
the completion of the investigation or legal proceedings, then a suspension
may be terminated or modified even though there is adequate evidence to
support the suspension.
Q12: What types of information
does the suspending official consider in a debarment proceeding?
Answer: The debarring official will consider any information that is
relevant to the determination of present responsibility. Such information
may include the seriousness of the acts or omissions that are at issue and
any relevant mitigating or aggravating factors. Relevant mitigating or
aggravating factors may include the actual or potential harm or impact that
results from the act or omission; whether you have accepted responsibility
for the wrongdoing and recognize the seriousness of the conduct; whether you
have paid all criminal, civil and administrative liabilities for the
improper activity; the extent of cooperation during the investigation or
legal or administrative proceeding; whether the wrongdoing was pervasive
with the organization; the kind of positions held by the individuals
involved in the wrongdoing; whether the organization has taken appropriate
corrective action; whether the principals tolerated the offense; whether the
activity was brought to the attention of the appropriate government agency
in a timely manner; whether you have fully investigated the wrongful
activity and made those results available to the relevant authorities;
whether you have taken appropriate disciplinary action against the
individuals involved; and whether you have had adequate time to eliminate
the circumstances leading to the cause for debarment. A listing of the
relevant aggravating and mitigating factors that the debarring official may
consider can be found at 49 C.F.R. 29.860.
Q13: How long is the term of
debarment?
Answer: Debarments generally do not exceed 3 years unless the debarring
official determines that the circumstances warrant a longer period of time.
Q14: How long is the term of
suspension?
Answer: Suspensions are only for a temporary period of time pending the
outcome of an investigation or legal or administrative proceedings. In the
case of an investigation, the suspension will not last longer than 12
months, unless a prosecuting official submits a written request for an
extension to the suspending official. In such cases, the suspension may not
be extended beyond an additional 6 months. In cases where a legal or
administrative proceeding have been initiated, such as where an indictment
has been filed or where a person has been proposed for debarment, the
suspension will continue until the conclusion of those proceedings.
Q15: When does a suspension take
effect?
Answer: A suspension takes effect immediately upon the signature of the
notice by the suspending official. The person or company that has been
suspended will not have an opportunity to respond until after the suspension
has been imposed.
Q16: When does a debarment take
effect?
Answer: A debarment imposed under the nonprocurement debarment process at 49
C.F.R. Part 29 does not take effect until the debarment proceedings have
been concluded. The person or company that has been proposed for debarment
will have an opportunity to respond prior to the imposition of the
debarment. Likewise, a debarment under the Federal Acquisition Regulations
(FAR) at 48 C.F.R. 9.4 will not take effect until after the debarment
proceedings have been concluded. However, like a suspension, a notice of
proposed debarment under the FAR at 48 C.F.R. Subpart 9.4 will have
immediate effect and the person or company will be excluded for the duration
of the debarment proceedings.
Q17: May an agency settle an
actual or potential suspension or debarment?
Answer: Yes. An agency may settle an actual or potential suspension or
debarment if it is in the best interests of the Federal Government to do so.
Q18: What is the effect if my
company is suspended or debarred?
Answer: If you company is suspended or debarred, then you company may not
bid on or receive any federally funded contracts. Your company may also not
receive any Federal grants, cooperative agreements, scholarships,
fellowships, contracts of assistance, loans, loan guarantees, subsidies, or
insurance.
Q19: What is the effect on a
company if a principal?
Answer: If a principal of a company is suspended or debarred, then that
company cannot bid on or receive any Federally funded contracts. The company
may also not receive any Federal grants, cooperative agreements,
scholarships, fellowships, contracts of assistance, loans, loan guarantees,
subsidies, or insurance. A principal is an officer, director, owner,
partner, principal investigator, or other person with management or
supervisory responsibilities related to a covered transaction.
Q20: What is the effect on an
individual if suspended or debarred?
Answer: If an individual is suspended or debarred, then that individual may
not bid on or receive any Federally funded contracts. The individual may
also not receive any Federal grants, cooperative agreements, scholarships,
fellowships, contracts of assistance, loans, loan guarantees, subsidies, or
insurance.
Q21: How does a State or Federal
agency or local government know if a person or company is debarred?
Answer: A State or Federal agency or local government knows if a person or
company is suspended or debarred by checking the Federal Excluded Parties
List System at or by collecting a certification from the person or company
that the person or company, or any of the company's principals, are not
debarred.
Q22: What happens if I do
business with a person or company that has been suspended or debarred?
Answer: If you knowingly do business with a suspended or debarred person,
then the Federal agency may disallow costs, annul or terminate the
transaction, issue a stop work order, initiate suspension or debarment
proceedings, or take other remedies as appropriate.