Harry Cassin Publisher and Editor

Andy Spalding Senior Editor

Jessica Tillipman Senior Editor

Richard L. Cassin Editor at Large

Elizabeth K. Spahn Editor Emeritus 

Cody Worthington Contributing Editor

Julie DiMauro Contributing Editor

Thomas Fox Contributing Editor

Marc Alain Bohn Contributing Editor

Bill Waite Contributing Editor

Shruti J. Shah Contributing Editor

Russell A. Stamets Contributing Editor

Richard Bistrong Contributing Editor 

Eric Carlson Contributing Editor

Bill Steinman Contributing Editor

Aarti Maharaj Contributing Editor

FCPA Blog Daily News

« Brazil interim president denies graft allegations in Petrobras scandal | Main | NYPD deputy chief, three others charged with ‘cops on call’ corruption »

New ISDC debarment report: Diversifying the government toolbox to protect taxpayer dollars

Last week, the U.S. Interagency Suspension & Debarment Committee (ISDC) released its FY2015 report. The annual report to Congress describes the status of the U.S. suspension and debarment system. 

While the full report is informative, I found one area to be particularly illuminating: its discussion of appropriate metrics and agencies' expanding use of diverse suspension & debarment tools.

For years, Congress has placed an unreasonable and detrimental emphasis on annual suspension and debarment numbers. This myopic focus on "numbers" has ignored the great strides many agencies have made in recent years to improve their programs and protect the government's interests. 

I applaud the committee for continuing to emphasize this point: "...the ISDC does not consider the overall number of suspensions and debarments to be a metric of success or failure. Rather, the appropriate level of discretionary suspension and debarment activity in any given year is purely a function of need." As my former colleague David Robbins has said, "This is akin to measuring the effectiveness of a general surgeon by counting the number of appendectomies she performed, or of a firefighter by the number of times he slid down his firehouse pole."

Rather than focus exclusively on the number of suspension and debarments in any given year, Congress/auditors should evaluate whether an agency's overall "level of activity is reflective of what is necessary to protect their agency and the government from harm." 

As I discuss in my articles, A House of Cards Falls: Why 'Too Big to Debar' is All Slogan and Little Substance and The Congressional War on Contractorssuspension and debarment officials have access to a panoply of tools that enable them to protect their agencies and taxpayer dollars.

While suspension and debarment are critical to the procurement system, they should be used only when necessary -- not to punish contractors or alleviate political pressure. In many instances, other remedies are far more effective at protecting the government and enhancing contractor ethics and compliance. 

The report's focus on the other (non-exclusionary) remedies available to suspension and debarment officials highlights the benefits of maintaining a diverse toolbox. For example, agencies' increasing use of pre-notice engagement letters (i.e., show cause letters, pre-notice investigative letters) provides suspension and debarment officials with the opportunity to engage with contractors in a proactive manner and create unique solutions to prevent misconduct going forward. They are also a highly effective driver of corporate cultural change. 

Moreover, the use of administrative agreements provides suspension and debarment officials with the discretion to determine the best solutions to enhance compliance for a particular contractor and to improve that contractor’s internal ethics and compliance program in a targeted manner. 

Most importantly, these flexible tools ensure that suspension and debarment officials have the discretion to exclude contractors that continue to pose a threat to the government, while working to ensure that responsible contractors remedy issues, improve their ethics and compliance programs, and continue to provide critical goods and services to the government. This system recognizes that putting imperfect companies out of business is not a productive method of effectuating change. Rather, it emphasizes the development of robust corporate compliance regimes and ethical corporate behavior.

The ISDC's annual report provides a window into the recent activities of agency suspension and debarment programs. It is clear that the committee and its member agencies have taken steps in recent years to improve the efficacy, transparency and efficiency of the suspension and debarment system. It is also refreshing to see that the committee has, among other things, spent time addressing the importance of diversified remedies in its formal report to Congress. I am hopeful that future reports will expand on these important issues as the system continues to improve and mature. 


Jessica Tillipman is a Senior Editor of the FCPA Blog and Assistant Dean at The George Washington Univeristy Law School. You can follow her on Twitter at @jtillipman.