WEBVTT 00:00:00.283 --> 00:00:04.388 (upbeat music) 00:00:29.459 --> 00:00:31.456 - Hello, and thank you for joining today's 00:00:31.456 --> 00:00:33.314 acquisition seminar hosted by 00:00:33.314 --> 00:00:35.775 the Federal Acquisition Institute. 00:00:35.775 --> 00:00:38.585 Today's seminar entitled Suspension and Debarment: 00:00:38.585 --> 00:00:41.348 What Makes a Successful Meeting will give us a glimpse 00:00:41.348 --> 00:00:43.972 into the minds of Suspension and Debarment Officials 00:00:43.972 --> 00:00:45.644 in the Federal Government, 00:00:45.644 --> 00:00:47.548 and a beind the closed door look 00:00:47.548 --> 00:00:48.918 at a successful meeting between 00:00:48.918 --> 00:00:51.007 a Suspension and Debarment Official 00:00:51.007 --> 00:00:53.562 and contractor representatives. 00:00:53.562 --> 00:00:56.023 Suspension and debarment, two terms that 00:00:56.023 --> 00:00:58.624 probably strike terror into the heart of 00:00:58.624 --> 00:01:00.272 any company or individual that wants to 00:01:00.272 --> 00:01:02.641 do business with the Federal Government. 00:01:02.641 --> 00:01:05.938 But suspension and debarment aren't meant to be punitive. 00:01:05.938 --> 00:01:08.545 And meetings with Suspension and Debarment Officials 00:01:08.545 --> 00:01:12.283 are not meant to be contentious or antagonistic. 00:01:12.283 --> 00:01:13.955 Suspension and debarment are used 00:01:13.955 --> 00:01:16.254 only as a last resort to protect 00:01:16.254 --> 00:01:19.087 the interests of the Federal Government. 00:01:19.087 --> 00:01:21.246 More often than not, a meeting with 00:01:21.246 --> 00:01:22.988 a Suspension and Debarment Official 00:01:22.988 --> 00:01:25.287 is an opportunity to help an individual 00:01:25.287 --> 00:01:28.561 or company get back on track. 00:01:28.561 --> 00:01:30.209 To enlighten us on the implications 00:01:30.209 --> 00:01:32.392 of suspension and debarment, we have a team of 00:01:32.392 --> 00:01:36.270 officials from agencies across the Federal Government. 00:01:36.270 --> 00:01:38.894 First we'll present two Suspension and Debarment Officials 00:01:38.894 --> 00:01:42.237 as they discuss, among other things, what they look for 00:01:42.237 --> 00:01:44.234 when they're determining a contractor's 00:01:44.234 --> 00:01:46.904 present responsibility and how members of 00:01:46.904 --> 00:01:49.389 the acquisition workforce can help. 00:01:49.389 --> 00:01:52.431 Then we'll present an example of a contractors meeting 00:01:52.431 --> 00:01:55.565 with a Suspension and Debarment Official. 00:01:55.565 --> 00:01:58.514 These closed door meetings have wide ranging effects 00:01:58.514 --> 00:02:02.276 on Federal Government procurement across all agencies. 00:02:02.276 --> 00:02:04.203 The meetings are necessarily private, 00:02:04.203 --> 00:02:07.454 but they are one of a Suspension and Debarment Official's 00:02:07.454 --> 00:02:09.683 most useful and effective tools 00:02:09.683 --> 00:02:13.236 for enhancing contractor responsibility. 00:02:13.236 --> 00:02:15.720 I think our presentations will help de-mistify 00:02:15.720 --> 00:02:18.228 suspension and debarment, and what officials 00:02:18.228 --> 00:02:21.943 are looking for when they meet with a contractor. 00:02:21.943 --> 00:02:24.405 And they'll shed light on what contractors can do 00:02:24.405 --> 00:02:26.703 to most effectively work with government 00:02:26.703 --> 00:02:29.560 to prevent exclusion. 00:02:29.560 --> 00:02:31.882 Before we begin, let me remind you that we will 00:02:31.882 --> 00:02:34.134 hold a live question and answer session 00:02:34.134 --> 00:02:36.363 at the end of today's presentation. 00:02:36.363 --> 00:02:39.056 If you have questions about anything you see or hear, 00:02:39.056 --> 00:02:41.564 we encourage you to submit them at any time 00:02:41.564 --> 00:02:44.345 using the survey link to the right of the video screen. 00:02:45.694 --> 00:02:47.485 We will collect and review your questions 00:02:47.485 --> 00:02:49.947 during the presentations, take a short break, 00:02:49.947 --> 00:02:53.151 and then we'll return to answer as many as we can. 00:02:53.151 --> 00:02:55.937 And with that, let's get started. 00:02:55.937 --> 00:02:58.167 I'm very pleased to introduce to you now, 00:02:58.167 --> 00:03:00.837 Maria Swaby, Suspension and Debarment Official 00:03:00.837 --> 00:03:03.391 for the U.S. General Services Administration 00:03:03.391 --> 00:03:06.177 and Rod Grandon, Suspension and Debarment Official 00:03:06.177 --> 00:03:08.897 for the U.S. Air Force. 00:03:08.897 --> 00:03:11.623 - Hello I'm Maria Swaby, the suspension and debarment 00:03:11.623 --> 00:03:14.308 official for the General Services Administration, 00:03:14.308 --> 00:03:16.769 and I'm here with Rod Grandon from the Air Force, 00:03:16.769 --> 00:03:18.325 and he's also the Air Force's 00:03:18.325 --> 00:03:20.345 Suspension and Debarment Official. 00:03:20.345 --> 00:03:21.831 Today we're going to have a conversation 00:03:21.831 --> 00:03:23.956 about suspension and debarment from the perspective 00:03:23.956 --> 00:03:26.040 of the Suspension and Debarment Official. 00:03:26.040 --> 00:03:28.402 You will hear me refer to the Suspension and Debarment 00:03:28.402 --> 00:03:31.142 Official as the SDO during this process, 00:03:31.142 --> 00:03:34.718 and we're going to talk about present responsibility 00:03:34.718 --> 00:03:37.435 as that's the lynchpin of the decisions 00:03:37.435 --> 00:03:40.859 that the SDO has to make, and we're going to 00:03:40.859 --> 00:03:42.995 examine the suspension and debarment process, 00:03:42.995 --> 00:03:45.317 and talk about the whys and the hows, 00:03:45.317 --> 00:03:47.175 and just get into the mind of the SDO 00:03:47.175 --> 00:03:50.333 and how he ultimately, or she ultimately makes a decision 00:03:50.333 --> 00:03:53.560 regarding the present responsibility of a contractor. 00:03:53.560 --> 00:03:56.277 So with that as an introduction, Rod I'd like to start off 00:03:56.277 --> 00:03:59.087 by asking you to define present responsibility. 00:03:59.087 --> 00:04:01.153 - All right, well it's very interesting that even though, 00:04:01.153 --> 00:04:03.080 as you point out, present responsibility 00:04:03.080 --> 00:04:05.356 is the cornerstone of the suspension and debarment 00:04:05.356 --> 00:04:08.142 decision making process, it is not defined 00:04:08.142 --> 00:04:10.789 in any authorities that I'm aware. 00:04:10.789 --> 00:04:12.531 Instead, suspending and debarring officials 00:04:12.531 --> 00:04:15.016 have to look basically across a horizon 00:04:15.016 --> 00:04:17.918 at various different authorities to get an idea of, 00:04:17.918 --> 00:04:20.751 what are some of the elements or factors 00:04:20.751 --> 00:04:25.256 that are part of the responsibility determination? 00:04:25.256 --> 00:04:27.183 We can look to Federal Acquisition Regulation 00:04:27.183 --> 00:04:31.455 Subpart 9.1, which covers the contracting officer's 00:04:31.455 --> 00:04:35.054 affirmative responsibility determinations 00:04:35.054 --> 00:04:37.818 as part of the source selection process. 00:04:37.818 --> 00:04:41.068 We can look to FAR Subpart 9.4, 00:04:41.068 --> 00:04:43.228 which is the suspension and debarment language, 00:04:43.228 --> 00:04:47.547 and within that subpart you find factors, 00:04:47.547 --> 00:04:50.496 10 factors that are laid out that are very useful 00:04:50.496 --> 00:04:53.886 for assessing present responsibility. 00:04:53.886 --> 00:04:58.739 You can also look to the FAR clause 52.203-13 00:04:58.739 --> 00:05:02.942 that lays out certain portions of our considerations 00:05:02.942 --> 00:05:05.356 for the integrity elements of how 00:05:05.356 --> 00:05:08.187 a business does conduct itself. 00:05:08.187 --> 00:05:09.945 Does it have an integrity program? 00:05:09.945 --> 00:05:12.848 Does it have a business conduct ethics program? 00:05:12.848 --> 00:05:15.750 We can also look to the U.S. Federal Sentencing Guidelines 00:05:15.750 --> 00:05:19.187 where again there are a host of considerations set forth 00:05:19.187 --> 00:05:24.187 that, again, focus on corporate elements of responsibility. 00:05:24.713 --> 00:05:28.382 But, using these various sources, we really come down to 00:05:28.382 --> 00:05:31.447 some basic nuggets that we focus on. 00:05:31.447 --> 00:05:35.324 Integrity: is there integrity in the decision making, 00:05:35.324 --> 00:05:38.877 whether it's organizational or individual? 00:05:38.877 --> 00:05:40.201 Is there a willingness to be 00:05:40.201 --> 00:05:42.801 candid and honest with the customer? 00:05:42.801 --> 00:05:45.750 Are the products that are provided of quality? 00:05:45.750 --> 00:05:48.142 Or are there shortcuts that are being made? 00:05:48.142 --> 00:05:49.999 Again, we're fundamentally looking at 00:05:49.999 --> 00:05:53.622 various elements of integrity, honesty, 00:05:53.622 --> 00:05:57.237 and essentially good customer relationships. 00:05:57.237 --> 00:05:58.338 - Okay, all right. 00:05:58.338 --> 00:06:00.380 So the term "present responsibility" has the word 00:06:00.380 --> 00:06:02.742 present in it, is there an element of time 00:06:02.742 --> 00:06:04.664 that's considered when you're making 00:06:04.664 --> 00:06:06.266 a present responsibility determination? 00:06:06.266 --> 00:06:07.149 - Absolutely. 00:06:07.149 --> 00:06:09.610 For suspension and debarment purposes we are focused 00:06:09.610 --> 00:06:14.300 on what is occurring today and going forward. 00:06:14.300 --> 00:06:17.644 So the present in present responsibility has a lot 00:06:17.644 --> 00:06:20.523 of impact on the decision making. 00:06:20.523 --> 00:06:22.799 And just to illustrate, if we have misconduct 00:06:22.799 --> 00:06:26.142 that occurred years before, five years before 00:06:26.142 --> 00:06:28.650 where we have definite acts of misconduct, 00:06:28.650 --> 00:06:31.437 the challenge for the suspending and debarring official 00:06:31.437 --> 00:06:35.779 is to figure out, what does that set of events 00:06:35.779 --> 00:06:39.525 five years ago have to do with conduct today? 00:06:39.525 --> 00:06:40.942 What changes have occurred? 00:06:40.942 --> 00:06:42.544 Have people been hired, fired? 00:06:42.544 --> 00:06:44.703 Have new processes been put into place? 00:06:44.703 --> 00:06:48.511 So, the present responsibility determination 00:06:48.511 --> 00:06:51.971 does have a very significant present day 00:06:51.971 --> 00:06:55.772 impact on the decision making process. 00:06:55.772 --> 00:06:56.848 - Okay, thank you. 00:06:56.848 --> 00:06:58.997 All right, we talked about you determining 00:06:58.997 --> 00:07:01.213 the present responsibility of a contractor. 00:07:01.213 --> 00:07:03.326 We all know contractor is a very broad term. 00:07:03.326 --> 00:07:06.414 Could you define what contractor means? 00:07:06.414 --> 00:07:09.502 - Yeah, well contractor actually is defined (laughs) 00:07:09.502 --> 00:07:12.451 in Federal Acquisition Regulation subpart 9.4 00:07:12.451 --> 00:07:16.282 and it is an incredibly broad definition. 00:07:16.282 --> 00:07:21.205 It includes individuals, it includes business entities, 00:07:21.205 --> 00:07:24.645 it includes prime contractors, subcontractors. 00:07:24.645 --> 00:07:29.645 Frankly, anywhere in the contracting supply chain. 00:07:29.660 --> 00:07:32.563 It also includes those competing for 00:07:32.563 --> 00:07:35.860 federal business opportunities, those preforming 00:07:35.860 --> 00:07:39.366 federal business opportunities, and includes those 00:07:39.366 --> 00:07:43.941 who may at some point in the future try to 00:07:43.941 --> 00:07:47.563 secure some sort of federal opportunity. 00:07:47.563 --> 00:07:50.744 So the definition is just very very broad. 00:07:50.744 --> 00:07:53.136 - Right, and I think some people might 00:07:53.136 --> 00:07:55.527 have difficulty with the definition being 00:07:55.527 --> 00:08:00.055 someone who may, or may reasonably be expected, 00:08:00.055 --> 00:08:02.447 to conduct business with the government in the future. 00:08:02.447 --> 00:08:05.164 Could you give an example of one of those, 00:08:05.164 --> 00:08:06.719 what that would look like? 00:08:06.719 --> 00:08:08.345 - Right, well let me just explain. 00:08:08.345 --> 00:08:10.876 What we try to do through the suspension and debarment 00:08:10.876 --> 00:08:13.012 process, and I think largely succeed, is we try to 00:08:13.012 --> 00:08:18.012 eliminate risk to our federal contracting processes. 00:08:18.747 --> 00:08:21.854 We don't want to do business with contractors that don't 00:08:21.854 --> 00:08:25.058 have the appropriate levels of integrity and honesty. 00:08:25.058 --> 00:08:27.450 Just like you or me going out to buy a house or a car, 00:08:27.450 --> 00:08:32.372 if we believe that the seller is not trustworthy 00:08:32.372 --> 00:08:33.945 and is trying to sell us something bad, 00:08:33.945 --> 00:08:36.128 or is going to give us a bad product, 00:08:36.128 --> 00:08:38.217 we're not gonna deal with them. 00:08:38.217 --> 00:08:40.330 Same thing in the federal marketplace, 00:08:40.330 --> 00:08:42.652 only because we're the Federal Government 00:08:42.652 --> 00:08:45.648 there's a lot of process that comes into play. 00:08:45.648 --> 00:08:50.338 But what we're really focussed on is trying to acheive 00:08:52.348 --> 00:08:56.004 getting rid of risk, trying to buy down risks 00:08:56.004 --> 00:08:59.441 so that contracting officers and the acquisition community 00:08:59.441 --> 00:09:02.320 can approach their business transactions 00:09:02.320 --> 00:09:05.199 with a certain degree of comfort that the business 00:09:05.199 --> 00:09:08.805 with whom they're going to work with are going to 00:09:08.805 --> 00:09:11.297 provide the quality products and services we expect, 00:09:11.297 --> 00:09:14.153 will do so in a timely manner, and that we can expect 00:09:14.153 --> 00:09:17.891 reasonably good customer-supplier relations. 00:09:17.891 --> 00:09:19.052 - So in terms of- 00:09:19.052 --> 00:09:22.419 Let me ask you this, is a Federal Government employee 00:09:22.419 --> 00:09:25.484 at any time can be considered a contractor? 00:09:25.484 --> 00:09:27.202 - That's an interesting question because 00:09:27.202 --> 00:09:29.107 under my definitional construct, 00:09:29.107 --> 00:09:32.752 active Federal Government employees are about the only 00:09:32.752 --> 00:09:35.608 people in the world that cannot be contractors. 00:09:35.608 --> 00:09:36.583 - [Maria] Right. 00:09:36.583 --> 00:09:40.995 - But, recognize that should a federal employee 00:09:40.995 --> 00:09:43.131 engage in some type of misconduct, 00:09:43.131 --> 00:09:46.614 that would impact their overall integrity, 00:09:46.614 --> 00:09:50.510 and they'd get fired from their federal job. 00:09:51.537 --> 00:09:53.395 They're very likely to be the target of a 00:09:53.395 --> 00:09:54.904 suspension and debarment action 00:09:54.904 --> 00:09:58.874 because in many many cases, those federal employees 00:09:58.874 --> 00:10:02.218 go out and work for contractors, 00:10:02.218 --> 00:10:04.610 and that is exactly the type of risk 00:10:04.610 --> 00:10:09.610 we do not want our contractors to assume. 00:10:09.625 --> 00:10:13.316 - Right, so that would be an example of a person 00:10:13.316 --> 00:10:16.522 or individual likely to do business with the government, 00:10:16.522 --> 00:10:18.193 if they're a former Federal Government employee. 00:10:18.193 --> 00:10:19.656 - And another example, I mean the supply chain 00:10:19.656 --> 00:10:22.861 starts at the top with our prime contractor relationship, 00:10:22.861 --> 00:10:26.971 but if we have a subcontractor or supplier 00:10:26.971 --> 00:10:28.944 three or four tiers down that is 00:10:28.944 --> 00:10:32.613 providing questionable products, is being difficult, 00:10:32.613 --> 00:10:35.771 and delaying what's going on in terms of 00:10:35.771 --> 00:10:39.649 the overall ability of the prime to successfully perform, 00:10:39.649 --> 00:10:43.573 that's a concern to us as the customer. 00:10:43.573 --> 00:10:45.941 That is a risk to our ability to acquire 00:10:45.941 --> 00:10:48.430 products and services when we need them. 00:10:48.430 --> 00:10:49.388 - [Maria] Mm-hmm. 00:10:49.388 --> 00:10:51.646 - That is another example of the risk 00:10:51.646 --> 00:10:55.686 that we have the ability to deal with 00:10:55.686 --> 00:10:58.449 through the suspension and debarment process. 00:10:58.449 --> 00:11:01.886 Again, not because they're a contractor 00:11:01.886 --> 00:11:04.045 in the traditional sense, but because they are 00:11:04.045 --> 00:11:06.553 participating in that federal marketplace. 00:11:06.553 --> 00:11:07.714 - Understood. 00:11:07.714 --> 00:11:10.756 All right, let's turn now to the acquisition workforce 00:11:10.756 --> 00:11:13.612 and their role in suspension and debarment. 00:11:13.612 --> 00:11:16.027 To whom should an acquisition workforce professional 00:11:16.027 --> 00:11:18.837 report misconduct or poor performance. 00:11:18.837 --> 00:11:22.157 - Okay, I believe there's two reporting schemes 00:11:22.157 --> 00:11:25.617 that should come into play for the acquisition community. 00:11:25.617 --> 00:11:28.543 First of all, if you have suspected misconduct, 00:11:28.543 --> 00:11:31.236 and again, I'm not saying wait until you have 00:11:31.236 --> 00:11:34.533 in your own mind confirmed that misconduct has occurred, 00:11:34.533 --> 00:11:37.482 but if you believe there has been misconduct on the part 00:11:37.482 --> 00:11:42.141 of a contractor as a business entity, or subcontractor 00:11:42.141 --> 00:11:45.516 as a business entity, or any employee of a contractor 00:11:45.516 --> 00:11:49.673 or subcontractor, if you suspect it, report it. 00:11:49.673 --> 00:11:51.461 In the case of the Air Force we have our 00:11:51.461 --> 00:11:54.224 Office of Special Investigations, or OSI that is 00:11:54.224 --> 00:11:57.335 responsible for conducting investigations 00:11:57.335 --> 00:12:00.075 of suspected procurement fraud. 00:12:00.075 --> 00:12:02.374 In fact, we have a branch within the organization 00:12:02.374 --> 00:12:04.510 dedicated to procurement fraud. 00:12:04.510 --> 00:12:06.368 And I believe a lot of the other federal agencies 00:12:06.368 --> 00:12:08.945 are organized somewhat similarly, 00:12:08.945 --> 00:12:12.147 so there are folks who understand how to conduct 00:12:12.147 --> 00:12:15.354 a procurement related investigation. 00:12:15.354 --> 00:12:18.628 But often times when a contracting professional 00:12:18.628 --> 00:12:21.948 sees something that they suspect to be a misconduct, 00:12:21.948 --> 00:12:24.201 it's usually in the form of a dot, 00:12:24.201 --> 00:12:26.964 a small you know, perhaps a small mis-charging. 00:12:29.064 --> 00:12:32.294 If it's not reported, we don't know if that's just 00:12:32.294 --> 00:12:35.986 a single dot out there, or if that's just a dot on a line 00:12:35.986 --> 00:12:39.980 that indicates some sort of a trend of a contractor's 00:12:39.980 --> 00:12:44.878 larger acts of not being honest to its customer. 00:12:46.833 --> 00:12:50.781 So it's critical that suspected misconduct 00:12:50.781 --> 00:12:53.172 be reported to the appropriate officials, 00:12:53.172 --> 00:12:54.612 and again I believe in most cases 00:12:54.612 --> 00:12:56.864 those should be the investigators. 00:12:56.864 --> 00:12:59.256 When it comes to poor performance, 00:12:59.256 --> 00:13:02.669 investigators may not be as anxious to look into 00:13:02.669 --> 00:13:05.316 performance related matters, simply because 00:13:05.316 --> 00:13:08.916 from their perspective they are law enforcement officials 00:13:08.916 --> 00:13:11.168 and this is really an acquisition issue. 00:13:11.168 --> 00:13:14.628 Most agencies, including the Air Force, have procedures 00:13:14.628 --> 00:13:18.018 in place that provide a way and means 00:13:18.018 --> 00:13:21.869 for contracting officials to report to either 00:13:21.869 --> 00:13:23.939 the suspending and debarring official, 00:13:23.939 --> 00:13:26.377 or perhaps the Inspector General's office, 00:13:26.377 --> 00:13:29.047 someone else in the organization, 00:13:29.047 --> 00:13:32.252 this poor performance on the part a contractor, 00:13:32.252 --> 00:13:36.060 so that again, the folks who are responsible 00:13:36.060 --> 00:13:38.101 for assessing whether we should continue 00:13:38.101 --> 00:13:41.215 to do business with those individuals can do their jobs. 00:13:41.215 --> 00:13:42.237 - Okay, well thank you. 00:13:42.237 --> 00:13:44.234 All right, so for the acquisition workforce 00:13:44.234 --> 00:13:48.312 is there a dollar threshold or a certain level of misconduct 00:13:48.312 --> 00:13:50.172 that should trigger reporting? 00:13:50.172 --> 00:13:53.817 - No, if we had a dollar threshold involved, 00:13:53.817 --> 00:13:56.185 what we would essentially be doing is condoning 00:13:56.185 --> 00:14:00.319 small scale misconduct, and again, that is not 00:14:00.319 --> 00:14:02.803 the purpose of suspension and debarment. 00:14:02.803 --> 00:14:05.172 It is to get rid of risks in the supply chain, 00:14:05.172 --> 00:14:07.145 whether large or whether small, 00:14:07.145 --> 00:14:09.955 whether at our prime level, whether at somewhere 00:14:09.955 --> 00:14:13.252 in that lower tier structure, or whether it's 00:14:13.252 --> 00:14:15.992 an employee somewhere in between. 00:14:15.992 --> 00:14:17.478 So, no dollar thresholds. 00:14:17.478 --> 00:14:19.684 - Okay, so how does acquisition workforce 00:14:19.684 --> 00:14:21.960 know whether something is worth reporting? 00:14:21.960 --> 00:14:23.817 What I mean is, how do they know- 00:14:23.817 --> 00:14:25.350 how do they distinguish between 00:14:25.350 --> 00:14:28.392 our run of the mill incompetence, and actual bad behavior 00:14:28.392 --> 00:14:30.296 and misconduct that should be reported? 00:14:30.296 --> 00:14:32.810 - You know, I think in most cases you're really 00:14:32.810 --> 00:14:34.300 talking about a spectrum. 00:14:34.300 --> 00:14:35.022 - [Maria] Yeah. 00:14:35.022 --> 00:14:39.669 - And my sense is, a contracting official probably could 00:14:39.669 --> 00:14:43.245 take the time and make the effort to try to figure out, 00:14:43.245 --> 00:14:45.753 was this just a mistake, incompetence, 00:14:45.753 --> 00:14:47.471 or is this something intentional? 00:14:47.471 --> 00:14:51.994 But the bigger point is, that is really not their role. 00:14:52.835 --> 00:14:54.855 And it also takes away from their time 00:14:54.855 --> 00:14:57.316 that they need to do their other jobs. 00:14:57.316 --> 00:14:59.476 So rather than a contracting official, 00:14:59.476 --> 00:15:04.476 who already has a tremendous burden on their efforts, 00:15:04.886 --> 00:15:08.880 trying to figure this out, much better to make that report. 00:15:08.880 --> 00:15:11.643 Whether to the SDO's office, the IG on the performance side 00:15:11.643 --> 00:15:14.569 or to the investigators on the misconduct side 00:15:14.569 --> 00:15:18.052 and let those individuals whose job it is 00:15:18.052 --> 00:15:21.140 to figure those things out, do their job. 00:15:21.140 --> 00:15:22.162 - Okay, thanks. 00:15:22.162 --> 00:15:24.693 So there are a lot of members of the acquisition workforce 00:15:24.693 --> 00:15:27.595 who think that, you know, because there is no 00:15:27.595 --> 00:15:30.033 privity of contract between the government 00:15:30.033 --> 00:15:33.795 and say a second or a third tier subcontractor, 00:15:33.795 --> 00:15:38.795 there is no duty to report, is that actually the case or no? 00:15:40.041 --> 00:15:42.410 - Again, going back to my earlier comments, 00:15:42.410 --> 00:15:44.267 absolutely not. - [Maria] Right. 00:15:44.267 --> 00:15:48.122 - The supply chain is a continuum. 00:15:48.122 --> 00:15:51.396 The prime has to rely on its suppliers, 00:15:51.396 --> 00:15:54.182 and so forth throughout the chain, so if you've got 00:15:54.182 --> 00:15:58.524 misconduct at anywhere within that supply chain, 00:15:58.524 --> 00:16:02.100 that affects the ultimate products or services 00:16:02.100 --> 00:16:05.003 that are provided to the government customer. 00:16:05.003 --> 00:16:09.438 So if a contracting officer or an acquisition professional 00:16:09.438 --> 00:16:13.803 sees misconduct, again at any place in that supply chain, 00:16:13.803 --> 00:16:17.402 it is critical to identify it, to raise the concern, 00:16:17.402 --> 00:16:19.469 and let those folks whose job it is 00:16:19.469 --> 00:16:21.814 to look into that do their jobs. 00:16:21.814 --> 00:16:24.577 - All right, let's go back to the topic of 00:16:24.577 --> 00:16:27.201 present responsibility, sounds rather fluid 00:16:27.201 --> 00:16:29.128 'cause there's no clear definition. 00:16:29.128 --> 00:16:30.986 So how does an SDO determine 00:16:30.986 --> 00:16:32.936 whether or not it's appropriate to initiate 00:16:32.936 --> 00:16:36.048 a suspension or debarment action against a contractor? 00:16:36.048 --> 00:16:38.695 - All right, what you're really, when you say it's fluid, 00:16:38.695 --> 00:16:41.226 what you're really hitting on is it is highly discretionary. 00:16:41.226 --> 00:16:42.271 - [Maria] Right. 00:16:42.271 --> 00:16:44.964 - Very very discretionary, and there is not 00:16:44.964 --> 00:16:48.494 a lot of legal authority that says, 00:16:48.494 --> 00:16:51.791 this is the triggering element or this is what 00:16:51.791 --> 00:16:54.322 you should do in a given case. 00:16:54.322 --> 00:16:58.478 But there are, generally accepted, a two tier process 00:16:58.478 --> 00:17:01.613 and this is common throughout the Federal Government. 00:17:01.613 --> 00:17:04.887 The first tier is whether or not the information 00:17:04.887 --> 00:17:06.652 that has been provided to 00:17:06.652 --> 00:17:10.413 the supsension and debarment official in record form, 00:17:10.413 --> 00:17:13.269 and I emphasize, in record from, we can only 00:17:13.269 --> 00:17:17.588 make decisions based on what is in the documentation. 00:17:17.588 --> 00:17:20.769 'Cause ultimately if our decisions are reviewed 00:17:20.769 --> 00:17:23.997 by court, that's all they're going to look at. 00:17:23.997 --> 00:17:27.016 So it is strictly a record review process, 00:17:27.016 --> 00:17:29.221 but we review the record to determine 00:17:29.221 --> 00:17:31.241 whether there's adequate evidence 00:17:31.241 --> 00:17:33.865 or preponderance of the evidence. 00:17:33.865 --> 00:17:36.930 Adequate evidence to support a suspension, 00:17:36.930 --> 00:17:40.367 or a preponderance of the evidence to support a debarment. 00:17:40.367 --> 00:17:44.059 Whether the cause is supported, whether the evidence 00:17:44.059 --> 00:17:47.403 supports a cause by those evidentiary standards. 00:17:47.403 --> 00:17:49.121 - Now before you go on, can you give an example 00:17:49.121 --> 00:17:51.095 of what constitutes adequate evidence? 00:17:51.095 --> 00:17:52.511 An example of that. 00:17:52.511 --> 00:17:54.786 - So for a suspension, adequate evidence is 00:17:54.786 --> 00:17:57.410 recognized as an indictment, very simple. 00:17:57.410 --> 00:18:00.104 That's in the regulations, but in many cases 00:18:00.104 --> 00:18:02.867 we're not necessarily waiting for an indictment, 00:18:02.867 --> 00:18:06.582 so we look and we see, an example is, 00:18:06.582 --> 00:18:10.739 an affidavit by an investigator that says, 00:18:10.739 --> 00:18:15.313 this company has engaged in this type of misconduct. 00:18:15.313 --> 00:18:17.426 It's that statement, that statement alone. 00:18:17.426 --> 00:18:20.863 It doesn't tell me what the sources are for that. 00:18:20.863 --> 00:18:24.206 There's no independent corroborating evidence, 00:18:24.206 --> 00:18:28.154 but it is an affidavit, a sworn statement 00:18:28.154 --> 00:18:32.705 made by an investigator, and whom I'm going to assume 00:18:32.705 --> 00:18:35.166 is doing their job and doing it correctly, 00:18:35.166 --> 00:18:38.208 and that this is the best information available to them. 00:18:38.208 --> 00:18:41.157 In my view, that clears that probable cause, 00:18:41.157 --> 00:18:45.243 evidentiary hurdle of adequate evidence. 00:18:45.243 --> 00:18:49.353 Now, ideally we'd want a little more supporting information, 00:18:49.353 --> 00:18:54.296 but if not there, that would be a useful tool 00:18:54.296 --> 00:18:56.935 for making that adequate evidence determination. 00:18:56.935 --> 00:18:59.326 As we go to the preponderance standard, 00:18:59.326 --> 00:19:01.462 there's a higher standard, and again, 00:19:01.462 --> 00:19:03.529 the preponderance standard is what is necessary 00:19:03.529 --> 00:19:05.781 to support a debarment. - [Maria] Mm-hmm. 00:19:05.781 --> 00:19:08.544 - A preponderance is essentially 50% 00:19:08.544 --> 00:19:11.122 or more of the evidence, weight of the evidence, 00:19:11.122 --> 00:19:13.467 indicates that something is more likely than not. 00:19:13.467 --> 00:19:17.345 So again, it's a higher burden, and to go back to 00:19:17.345 --> 00:19:21.176 that example, that isolated affidavit from the investigator, 00:19:21.176 --> 00:19:24.148 I would have a little bit of trouble saying 00:19:24.148 --> 00:19:26.679 that that would clear that preponderance standard. 00:19:26.679 --> 00:19:30.023 I would want to see supporting information 00:19:30.023 --> 00:19:33.669 that collaborates, or corroborates excuse me, 00:19:33.669 --> 00:19:37.314 what is in that declaration or that affidavit. 00:19:37.314 --> 00:19:40.960 So again, the first tier of the analysis is, 00:19:40.960 --> 00:19:43.328 does the evidence support a cause? 00:19:43.328 --> 00:19:45.650 Now just because a cause is established 00:19:45.650 --> 00:19:48.227 does not mean the suspending and debarring official 00:19:48.227 --> 00:19:49.644 has to take action, in fact that's 00:19:49.644 --> 00:19:52.616 very clearly stated in the FAR. 00:19:52.616 --> 00:19:56.401 It leads to the next analysis, 00:19:56.401 --> 00:19:58.793 and that is not withstanding the cause, 00:19:58.793 --> 00:20:01.852 is there a need to protect the government's interests? 00:20:02.740 --> 00:20:05.851 If that answer is also yes, then it would be appropriate 00:20:05.851 --> 00:20:09.079 to go ahead and initiate that action. 00:20:09.079 --> 00:20:10.402 - [Maria] Right and if not then, 00:20:10.402 --> 00:20:12.214 you terminate the review at that time? 00:20:12.214 --> 00:20:14.814 - Or if not I would give it back to the stakeholder that 00:20:14.814 --> 00:20:16.602 brought it to my attention in the first place, 00:20:16.602 --> 00:20:20.248 talk to them about what was missing from the record, 00:20:20.248 --> 00:20:22.848 why I made that decision, and if they think that there's 00:20:22.848 --> 00:20:25.635 more information to be developed, let them do so, 00:20:25.635 --> 00:20:28.560 and then bring it back again if they would like. 00:20:28.560 --> 00:20:29.396 - Okay, all right. 00:20:29.396 --> 00:20:32.438 So say we're at the stage where you do have cause 00:20:32.438 --> 00:20:35.341 and you do have evidence meeting the evidentiary standards 00:20:35.341 --> 00:20:37.756 to take action, what's the next step? 00:20:37.756 --> 00:20:40.937 - The next step then is to start complying with 00:20:40.937 --> 00:20:43.561 the process requirement set out in the FAR. 00:20:43.561 --> 00:20:46.556 And fundamental to most of 00:20:46.556 --> 00:20:49.784 the American process is to provide notice. 00:20:49.784 --> 00:20:53.011 Agencies approach the notice obligation differently. 00:20:53.011 --> 00:20:56.053 In the Air Force we have, essentially, two documents. 00:20:56.053 --> 00:20:59.652 We have a notice letter that identifies 00:20:59.652 --> 00:21:03.994 that we're taking the action, the consequences of the action 00:21:03.994 --> 00:21:08.383 and the process that is available to the respondent. 00:21:08.383 --> 00:21:11.633 Separately we have a memorandum that lays out 00:21:11.633 --> 00:21:16.633 the factual allegations and the causes for the action. 00:21:16.997 --> 00:21:20.109 Now, some agencies combine those into a single document, 00:21:20.109 --> 00:21:23.035 but the critical piece is that 00:21:23.035 --> 00:21:25.745 the Suspending and Debarring Official provides 00:21:25.745 --> 00:21:28.700 the contractor with enough information that 00:21:28.700 --> 00:21:33.196 the contractor knows the basis for the cause for the action 00:21:33.196 --> 00:21:35.507 so that they can respond appropriately. 00:21:35.507 --> 00:21:37.971 - In your experience, do most contractors 00:21:37.971 --> 00:21:41.245 or individuals who get these notices respond? 00:21:41.245 --> 00:21:43.149 - Interestingly, no. 00:21:43.149 --> 00:21:46.191 Most contractors do not respond, 00:21:46.191 --> 00:21:48.977 and that's interesting because our practice 00:21:48.977 --> 00:21:53.782 in the Air Force is, as I said earlier, all of these actions 00:21:55.083 --> 00:21:58.486 are based on a set of documents, the record. 00:21:58.486 --> 00:22:01.406 We do not provide the record with our notice letter. 00:22:02.781 --> 00:22:05.057 Because in most cases that would just be wasted 00:22:05.057 --> 00:22:08.441 time and effort because most contractors do not respond. 00:22:09.979 --> 00:22:12.417 But we make it very clear that the contractor 00:22:12.417 --> 00:22:16.086 may request the record, and then we'll provide the record. 00:22:16.086 --> 00:22:19.174 But it is interesting, most contractors for whatever reason 00:22:19.174 --> 00:22:21.566 do not respond to those causes, and I think that's 00:22:21.566 --> 00:22:23.610 not just the Air Force experience. 00:22:23.610 --> 00:22:25.305 - [Maria] Right, that's consistent. 00:22:25.305 --> 00:22:27.325 - That's kind of the same across the federal agencies. 00:22:27.325 --> 00:22:28.300 - Yes, that's correct. 00:22:28.300 --> 00:22:30.134 And in cases where they do not respond? 00:22:30.134 --> 00:22:31.806 - And in cases where they do not respond, 00:22:31.806 --> 00:22:34.569 then we will go ahead and take the adverse action 00:22:34.569 --> 00:22:37.332 against them to suspend or to debar. 00:22:37.332 --> 00:22:40.328 - Okay, so let's talk about the contractors that do respond. 00:22:40.328 --> 00:22:42.743 Tell me some more about what form their responses take. 00:22:42.743 --> 00:22:45.413 What do those responses look like? 00:22:45.413 --> 00:22:49.616 - The regulatory structure, again, allows the contractor 00:22:49.616 --> 00:22:52.634 to respond in writing, in person 00:22:52.634 --> 00:22:56.210 through a meeting in opposition, or both. 00:22:56.210 --> 00:23:00.111 And frequently, of those that do respond, 00:23:00.111 --> 00:23:03.060 they respond with both the written submission 00:23:03.060 --> 00:23:05.661 and a request for the live meeting. 00:23:05.661 --> 00:23:08.424 It's interesting, as I said earlier, 00:23:08.424 --> 00:23:11.442 the suspending and debarring offices are not 00:23:11.442 --> 00:23:13.927 structured, we don't have the resources, the personnel, 00:23:13.927 --> 00:23:17.201 the funding, to investigate these matters. 00:23:17.201 --> 00:23:21.543 So when contractors respond with written submissions, 00:23:21.543 --> 00:23:25.351 we are not, we the suspending and debarring officials 00:23:25.351 --> 00:23:27.673 and our offices, are not in a good position to 00:23:27.673 --> 00:23:30.576 confirm or deny, or really to assess 00:23:30.576 --> 00:23:33.362 the quality of that information. 00:23:33.362 --> 00:23:35.336 So when we receive these responses, 00:23:35.336 --> 00:23:37.565 we frequently look back to the stakeholder 00:23:37.565 --> 00:23:40.096 that brought the matter to our attention in the first place. 00:23:40.096 --> 00:23:42.999 If it's the acquisition community, we go back 00:23:42.999 --> 00:23:45.506 to the acquisition community, provide them with 00:23:45.506 --> 00:23:49.314 the written response, and invite them to submit comments. 00:23:49.314 --> 00:23:51.636 Ideally comments saying, well yes that makes sense, 00:23:51.636 --> 00:23:54.934 or that's right, or in many cases no, 00:23:54.934 --> 00:23:57.372 that's not at all what occurred. 00:23:57.372 --> 00:24:00.646 But again, to provide some degree of verification 00:24:00.646 --> 00:24:05.429 or denial of what's being represented by the contractor. 00:24:05.429 --> 00:24:08.564 Likewise, when we have these live meetings, 00:24:08.564 --> 00:24:10.839 the Air Force practice, and again, this is not 00:24:10.839 --> 00:24:13.045 the same across the Federal Government, 00:24:13.045 --> 00:24:15.623 but the Air Force practice is to invite the 00:24:15.623 --> 00:24:18.014 acquisition community if they were the source 00:24:18.014 --> 00:24:22.194 of the initial referral, or the investigators if they were 00:24:22.194 --> 00:24:25.537 the source of the referral, to participate in that meeting, 00:24:25.537 --> 00:24:27.720 whether live or telephonically or otherwise, 00:24:27.720 --> 00:24:31.064 but to listen to what the contractor is representing 00:24:31.064 --> 00:24:34.524 and then, again, to provide comments to our office 00:24:34.524 --> 00:24:38.239 as to whether or not what was being represented makes sense, 00:24:38.239 --> 00:24:41.513 whether it was true, or whether it was not true. 00:24:41.513 --> 00:24:45.855 But ultimately if that live meeting process is 00:24:45.855 --> 00:24:48.061 going to be included in the record, 00:24:48.061 --> 00:24:51.753 those pieces of information that either party, 00:24:51.753 --> 00:24:54.934 the government or the contractor wants into the record 00:24:54.934 --> 00:24:58.022 have to be reduced to writing and made a part 00:24:58.022 --> 00:25:00.321 of the official record for the SDO, 00:25:00.321 --> 00:25:02.434 and ultimately should the court review, 00:25:02.434 --> 00:25:04.245 for the court to review. 00:25:04.245 --> 00:25:06.172 - Right, okay, so based on what you just said, 00:25:06.172 --> 00:25:07.960 it seems that the building of the administrative record 00:25:07.960 --> 00:25:10.329 is an iterative process, you go back and forth, 00:25:10.329 --> 00:25:13.371 so it is kind of evolving at some point. 00:25:13.371 --> 00:25:16.459 Is there a point, when is the administrative record deemed 00:25:16.459 --> 00:25:19.449 to be complete and that the SDO can make a final decision? 00:25:21.246 --> 00:25:23.246 - To clarify, it is an iterative process. 00:25:24.111 --> 00:25:26.967 When we receive the submission from the contractor 00:25:26.967 --> 00:25:29.730 we look to the government stakeholder that brought 00:25:29.730 --> 00:25:32.098 the matter to our attention to provide comments. 00:25:32.098 --> 00:25:35.001 If we receive those comments, we are then obligated 00:25:35.001 --> 00:25:39.320 to provide those comments to the contractor, and we invite 00:25:39.320 --> 00:25:42.640 the contractor to provide comments on the comments. 00:25:42.640 --> 00:25:46.077 So this iterative process potentially could go on 00:25:46.077 --> 00:25:49.142 for a very long time, but generally it doesn't. 00:25:49.142 --> 00:25:51.557 Maybe one or two rounds, but at some point 00:25:51.557 --> 00:25:54.831 it's clear we're not getting any new information. 00:25:54.831 --> 00:25:56.595 Either the parties are just done, 00:25:56.595 --> 00:25:58.383 they don't have anything else to give us, 00:25:58.383 --> 00:26:01.843 or I make the conclusion or I reach the conclusion 00:26:01.843 --> 00:26:04.003 that this isn't going anywhere. 00:26:04.003 --> 00:26:08.066 And in the Air Force, our practice is to close the record, 00:26:08.066 --> 00:26:09.831 to make it clear to the government side 00:26:09.831 --> 00:26:12.803 and to the contractor that we have all of the evidence 00:26:12.803 --> 00:26:16.031 that we're going to collect, and by making that 00:26:16.031 --> 00:26:19.258 representation that the record is closed, I then start 00:26:19.258 --> 00:26:23.809 my clock under the FAR, my 30 working-day clock, 00:26:23.809 --> 00:26:26.781 within which I must make that decision. 00:26:26.781 --> 00:26:28.151 - Okay, all right. 00:26:28.151 --> 00:26:30.566 Well, so we already discussed the definition of 00:26:30.566 --> 00:26:34.142 contractor, at least for suspension and debarment purposes, 00:26:34.142 --> 00:26:37.950 and that includes contracting and subcontracting 00:26:37.950 --> 00:26:40.435 companies as well as individuals. 00:26:40.435 --> 00:26:43.407 Do the procedures you outlined apply the same 00:26:43.407 --> 00:26:45.938 to individuals as it does to companies? 00:26:45.938 --> 00:26:49.653 - Now, the procedures, the authorities that 00:26:49.653 --> 00:26:52.416 govern the process, absolutely, they are the same 00:26:52.416 --> 00:26:56.340 procedures for individuals or for business entities. 00:26:56.340 --> 00:26:59.220 The application of these procedures or these 00:26:59.220 --> 00:27:02.308 legal authorities, very different. 00:27:02.308 --> 00:27:05.001 As I indicated earlier, the authorities that 00:27:05.001 --> 00:27:08.322 we look to for present responsibility considerations 00:27:08.322 --> 00:27:11.573 are very much focused on what businesses 00:27:11.573 --> 00:27:16.193 can do or should do to establish present responsibility. 00:27:16.193 --> 00:27:19.491 By way of example, we expect businesses 00:27:19.491 --> 00:27:21.348 that do business with the Federal Government 00:27:21.348 --> 00:27:23.508 to have ethics programs in place, 00:27:23.508 --> 00:27:25.667 we expect them to have strong compliance programs, 00:27:25.667 --> 00:27:29.034 and we expect them to take appropriate steps 00:27:29.034 --> 00:27:33.789 to prevent misconduct or poor performance from occurring. 00:27:35.768 --> 00:27:38.368 We expect them to report discrepancies 00:27:38.368 --> 00:27:42.780 or misconduct when identified, and we expect companies 00:27:42.780 --> 00:27:46.658 to respond appropriately when they identify problems. 00:27:46.658 --> 00:27:49.398 That they cooperate fully with their government customer, 00:27:49.398 --> 00:27:51.557 whether it's investigators, Department of Justice, 00:27:51.557 --> 00:27:53.345 suspending and debarring officials, 00:27:53.345 --> 00:27:55.737 or the contracting community. 00:27:55.737 --> 00:27:58.175 So companies have a lot of tools 00:27:58.175 --> 00:28:00.567 in which to accomplish these objectives. 00:28:00.567 --> 00:28:02.262 They can hire people, they can fire people, 00:28:02.262 --> 00:28:04.143 they can develop policies, they can do training. 00:28:04.143 --> 00:28:08.020 They can have their leadership suddenly 00:28:08.020 --> 00:28:10.900 take on a brand new marketing campaign 00:28:10.900 --> 00:28:15.033 within the organization to promote ethics and compliance. 00:28:15.033 --> 00:28:19.793 A lot of tools are available to the business entities. 00:28:19.793 --> 00:28:21.465 - Before you move on to the individuals, 00:28:21.465 --> 00:28:23.276 let me go back to the businesses. 00:28:23.276 --> 00:28:25.598 You have large businesses and small businesses. 00:28:25.598 --> 00:28:27.734 Could you talk about your expectations 00:28:27.734 --> 00:28:30.497 as it relates to the size of the business, 00:28:30.497 --> 00:28:32.726 or any different or scaled- 00:28:32.726 --> 00:28:35.745 When you talk about ethics and compliance programs 00:28:35.745 --> 00:28:37.278 for example, can you give me- 00:28:37.278 --> 00:28:39.065 - Yes, in my view the simple answer's that 00:28:39.065 --> 00:28:41.736 these programs are necessary whether you're 00:28:41.736 --> 00:28:43.686 a small business or a large business, 00:28:43.686 --> 00:28:45.567 but they're scaleable. 00:28:45.567 --> 00:28:49.863 A very large business, defense contractor for example, 00:28:49.863 --> 00:28:52.951 most of them have spent a lot of money 00:28:52.951 --> 00:28:55.691 to build an infrastructure within their organizations 00:28:55.691 --> 00:28:58.617 to promote sound ethics and compliance 00:28:58.617 --> 00:29:01.612 and to develop very robust internal controls. 00:29:01.612 --> 00:29:06.529 And that same effort should be alive and well 00:29:07.635 --> 00:29:11.188 within small business concerns, but because it is smaller 00:29:11.188 --> 00:29:14.462 in terms of population, in terms of revenue, 00:29:14.462 --> 00:29:16.644 in terms of business operations, 00:29:16.644 --> 00:29:20.754 they don't need the infrastructure of a large business. 00:29:20.754 --> 00:29:22.960 In fact, for a very small business it may be 00:29:22.960 --> 00:29:25.839 nothing more than that senior leader of that organization 00:29:25.839 --> 00:29:28.841 to set the right tone and say, we're gonna do these things 00:29:28.841 --> 00:29:31.180 according to our contract, we're gonna be honest 00:29:31.180 --> 00:29:33.873 and open with our customer, and that may be 00:29:33.873 --> 00:29:37.101 more than enough to carry that business, 00:29:37.101 --> 00:29:39.678 but it's a spectrum. 00:29:39.678 --> 00:29:42.488 We expect more out of our large business suppliers, 00:29:42.488 --> 00:29:46.644 but we expect the same attention to promoting ethics, 00:29:46.644 --> 00:29:50.894 to promoting compliance by our small business concerns. 00:29:50.894 --> 00:29:52.078 - Okay, thank you. 00:29:52.078 --> 00:29:53.773 And so back to the individual, to the process. 00:29:53.773 --> 00:29:55.331 - Back to the individuals, yes. 00:29:55.331 --> 00:29:58.675 So again, the individuals, an individual can't hire or fire, 00:29:58.675 --> 00:30:03.458 can't write policies, so there's really not a lot of tools 00:30:03.458 --> 00:30:07.173 set forth in the various legal authorites 00:30:07.173 --> 00:30:11.469 that individuals can use, but with one major exception, 00:30:11.469 --> 00:30:16.469 and that is recognizing and taking responsibility for 00:30:16.508 --> 00:30:20.757 the underlying, either poor performance or misconduct. 00:30:20.757 --> 00:30:24.844 That's sort of the basic element if the evidence suggests 00:30:24.844 --> 00:30:28.141 or indicates by either preponderance or whatever 00:30:28.141 --> 00:30:31.000 the appropriate side it's in, that the individual 00:30:31.000 --> 00:30:33.096 has engaged in misconduct, and they wanna 00:30:33.096 --> 00:30:36.045 continue to fight about it, that's probably not 00:30:36.045 --> 00:30:38.947 a very productive conversation. 00:30:38.947 --> 00:30:41.685 But that's a factual dispute, and we can 00:30:41.685 --> 00:30:43.925 entertain facts to try to work through that 00:30:43.925 --> 00:30:46.270 and make appropriate conclusions. 00:30:46.270 --> 00:30:48.337 When you get to the responsibility side, though, 00:30:48.337 --> 00:30:50.682 it's much more difficult, again, can't hire, 00:30:50.682 --> 00:30:53.190 can't fire, can't discipline. 00:30:53.190 --> 00:30:56.069 But the acceptance of responsibility is 00:30:56.069 --> 00:30:59.691 a very helpful first step, and then my practice 00:30:59.691 --> 00:31:02.594 is actually to find out what the individual 00:31:02.594 --> 00:31:06.472 can do with this situation. 00:31:06.472 --> 00:31:10.210 They've just been subjected to suspension and debarment, 00:31:10.210 --> 00:31:12.393 there have probably been other consequences 00:31:12.393 --> 00:31:14.831 for instance they've been fired from their employer, 00:31:14.831 --> 00:31:18.802 so what can they do with these very unfortunate 00:31:18.802 --> 00:31:22.911 set of circumstances today and going forward? 00:31:22.911 --> 00:31:24.908 Can they identify lessons learned, 00:31:24.908 --> 00:31:28.461 and carry those forward in their careers? 00:31:28.461 --> 00:31:31.015 Not only for themselves and how they conduct themselves 00:31:31.015 --> 00:31:34.498 but perhaps training those that they work with 00:31:34.498 --> 00:31:37.145 and those that work for them. 00:31:37.145 --> 00:31:38.817 What goodness in others- 00:31:38.817 --> 00:31:40.930 what goodness can come out of this thing? 00:31:40.930 --> 00:31:44.343 If an individual can articulate that type of a vision, 00:31:44.343 --> 00:31:46.387 that's very helpful. 00:31:46.387 --> 00:31:47.548 - Okay, thanks. 00:31:47.548 --> 00:31:49.405 Well I have one more question for you. 00:31:49.405 --> 00:31:51.356 This is an issue that has come up 00:31:51.356 --> 00:31:53.655 from the acquisition workforce too, 00:31:53.655 --> 00:31:57.493 several SDO offices, and that question is, 00:31:57.493 --> 00:32:00.621 when a contracting officer is settling a claim, 00:32:00.621 --> 00:32:05.265 or a controversy, can that contracting officer 00:32:05.265 --> 00:32:09.444 include language in that settlement that insulates 00:32:09.444 --> 00:32:12.231 the contractor from suspension and debarment? 00:32:12.231 --> 00:32:14.529 - Ah, no. 00:32:14.529 --> 00:32:16.457 I would say they absolutely can not. 00:32:16.457 --> 00:32:19.847 A contracting officer derives their authority 00:32:19.847 --> 00:32:22.865 to obligate the government in these financial transactions 00:32:22.865 --> 00:32:25.280 through their warrant, and their warrant is- 00:32:25.280 --> 00:32:28.554 there are dollar thresholds that are associated with it, 00:32:28.554 --> 00:32:32.891 and it allows them to obligate financial relationships. 00:32:34.475 --> 00:32:36.890 The authority of the Suspending and Debarring Official 00:32:36.890 --> 00:32:39.537 does not travel through that warrant process. 00:32:39.537 --> 00:32:40.884 It is an independent authority 00:32:40.884 --> 00:32:43.438 that is vested with the agency head. 00:32:43.438 --> 00:32:46.480 In the case of the Air Force, the Secretary of the Air Force 00:32:46.480 --> 00:32:49.684 has delegated the suspension and debarment authority 00:32:49.684 --> 00:32:52.239 to the General Counsel, and the General Counsel 00:32:52.239 --> 00:32:55.420 in turn to me and my office. 00:32:55.420 --> 00:32:58.276 It is a line of authority very separate and distinct 00:32:58.276 --> 00:33:01.829 from that of the warranted contracting officer. 00:33:01.829 --> 00:33:04.104 So, bottom line is contracting officers 00:33:04.104 --> 00:33:06.844 do not have the authority to make those type 00:33:06.844 --> 00:33:10.025 of determinations and to provide that type of relief 00:33:10.025 --> 00:33:11.999 to the contractors when settling claims 00:33:11.999 --> 00:33:14.971 or other related disputes. 00:33:14.971 --> 00:33:17.386 - Right, and neither does the Department of Justice. 00:33:17.386 --> 00:33:19.220 - And neither does the Department of Justice, 00:33:19.220 --> 00:33:21.310 and for the most part they're pretty good at that. 00:33:21.310 --> 00:33:23.005 - Right, right. 00:33:23.005 --> 00:33:24.979 Well Rod, this has been very helpful. 00:33:24.979 --> 00:33:29.414 It is a good refresher on present responsibility 00:33:29.414 --> 00:33:32.897 and also a good insight into the mind of an SDO, 00:33:32.897 --> 00:33:35.637 and what he or she thinks about when making 00:33:35.637 --> 00:33:38.377 responsibility determinations or determinations 00:33:38.377 --> 00:33:40.606 to take exclusion actions. 00:33:40.606 --> 00:33:42.997 It's also been helpful for the acquisition workforce 00:33:42.997 --> 00:33:44.948 to realize that they actually do play 00:33:44.948 --> 00:33:46.945 an important role- - [Rod] A huge roll. 00:33:46.945 --> 00:33:49.685 - in that process, and we depend on them greatly 00:33:49.685 --> 00:33:52.123 in having our program a success 00:33:52.123 --> 00:33:54.236 and protecting the government's interests. 00:33:54.236 --> 00:33:55.632 So thank you very much for your time. 00:33:55.632 --> 00:33:57.439 - Thank you Maria. 00:33:57.439 --> 00:33:59.738 - Now that Maria and Rod have laid the foundation, 00:33:59.738 --> 00:34:01.944 let's see what happens, or should happen, 00:34:01.944 --> 00:34:04.196 in a meeting between a contractor 00:34:04.196 --> 00:34:07.029 and a Suspension and Debarment Official. 00:34:07.029 --> 00:34:08.492 Again, these closed door meetings 00:34:08.492 --> 00:34:10.837 have wide ranging effects on federal government 00:34:10.837 --> 00:34:14.134 procurement across all agencies. 00:34:14.134 --> 00:34:16.177 They're necessarily private, but these meetings 00:34:16.177 --> 00:34:18.824 are one of the most useful and effective tools 00:34:18.824 --> 00:34:22.006 the Suspension and Debarment Officials have 00:34:22.006 --> 00:34:25.233 in enhancing contractor responsibility. 00:34:25.233 --> 00:34:27.137 Please note that today's mock meeting 00:34:27.137 --> 00:34:29.808 features members of various Suspension and Debarment 00:34:29.808 --> 00:34:32.501 Offices from across the Federal Government 00:34:32.501 --> 00:34:34.893 playing the roles that normally participate 00:34:34.893 --> 00:34:36.448 in such a meeting. 00:34:36.448 --> 00:34:38.329 They are not actual representatives 00:34:38.329 --> 00:34:41.185 of any contractor, and the contractor's name 00:34:41.185 --> 00:34:43.902 is completely made up, and any similarity 00:34:43.902 --> 00:34:46.874 to actual facts is totally unintended. 00:34:46.874 --> 00:34:50.195 With that, let's see how suspension and debarment meetings 00:34:50.195 --> 00:34:53.515 are supposed to work. 00:34:53.515 --> 00:34:55.373 - Good morning, thanks for coming in to meet with me, 00:34:55.373 --> 00:34:57.439 I really appreciate you taking the time to come 00:34:57.439 --> 00:34:59.715 and talk with me and address my concerns. 00:34:59.715 --> 00:35:01.735 First of all, let's just start off with some introductions. 00:35:01.735 --> 00:35:03.175 As you know, I am Maria Swaby, 00:35:03.175 --> 00:35:05.288 the GSA Suspension and Debarment Offical, 00:35:05.288 --> 00:35:07.099 and to my right is Michael Thompson 00:35:07.099 --> 00:35:08.631 who is the agency counsel. 00:35:08.631 --> 00:35:11.789 To my left is Dillon Mooney, who is the case officer 00:35:11.789 --> 00:35:14.111 in this case, and he's handling this matter. 00:35:14.111 --> 00:35:17.710 So we'll start off with the introductions on your side. 00:35:17.710 --> 00:35:19.522 - Thank you Ms. Swaby, I'm Barry Berkowitz. 00:35:19.522 --> 00:35:21.379 I'm the general counsel for Clark Industries, 00:35:21.379 --> 00:35:23.840 and I've been with the company since 2007. 00:35:24.790 --> 00:35:27.904 - Hi, I'm Sarah Drabkin, and I am the VP, 00:35:27.904 --> 00:35:30.249 the Senior Vice President of Operations, 00:35:30.249 --> 00:35:33.709 and I've been with the company since 2014. 00:35:33.709 --> 00:35:35.984 - Good morning, and thank you for hosting this meeting. 00:35:35.984 --> 00:35:40.984 I am Mike Russell, I am the CEO and President since 2014. 00:35:41.255 --> 00:35:44.203 I've been with the company since 1993. 00:35:44.203 --> 00:35:45.735 - My name is Lori Vassar. 00:35:45.735 --> 00:35:48.429 I've worked on ethics and compliance programs for many 00:35:48.429 --> 00:35:51.447 large corporations, and was hired by Clark Industries 00:35:51.447 --> 00:35:55.488 as the Ethics and Compliance Officer in 2015. 00:35:55.488 --> 00:35:57.786 - I'm Bill Schmidt from Schmidt and Duch�, 00:35:57.786 --> 00:35:59.992 outside counsel for Clark Industries. 00:35:59.992 --> 00:36:02.755 Now I know that you don't want to hear from a lawyer, 00:36:02.755 --> 00:36:04.613 so I'm just here to watch today. 00:36:04.613 --> 00:36:05.611 (laughter) 00:36:05.611 --> 00:36:07.888 - [Maria] You got that right, I see you did your homework. 00:36:07.888 --> 00:36:10.827 All right well as I said, thanks for coming, 00:36:10.827 --> 00:36:13.474 and as you know the reason you're here 00:36:13.474 --> 00:36:16.841 is because your company received a show cause letter 00:36:16.841 --> 00:36:20.579 from my office because we received information 00:36:20.579 --> 00:36:25.061 from our IG's office that informed us 00:36:25.061 --> 00:36:29.565 that your CEO and owner, John Clark, 00:36:29.565 --> 00:36:34.163 was indicted in 2014 for bribing a government official 00:36:34.163 --> 00:36:39.132 and then was later convicted in 2015 for that crime. 00:36:39.132 --> 00:36:41.431 As you know, GSA has millions of dollars in contracts 00:36:41.431 --> 00:36:44.194 with your company, so I'm very concerned about 00:36:44.194 --> 00:36:47.839 the status of the company and the present responsibility. 00:36:47.839 --> 00:36:51.044 I'm especially concerned because Mr. Clark, 00:36:51.044 --> 00:36:54.829 as the CEO and owner, had full control of the company, 00:36:54.829 --> 00:36:57.476 and I am concerned about whether or not 00:36:57.476 --> 00:37:01.609 his behavior was so pervasive that it actually went down 00:37:01.609 --> 00:37:04.210 into the company and became a part of the company culture. 00:37:04.210 --> 00:37:08.621 So thank you for coming here to address those concerns. 00:37:08.621 --> 00:37:10.734 And I want to thank Barry for actually 00:37:10.734 --> 00:37:13.242 making a submission to me a week in advance, 00:37:15.425 --> 00:37:18.420 so we can talk intelligently about the matters, 00:37:18.420 --> 00:37:21.439 and I noticed that your submission was very detailed. 00:37:21.439 --> 00:37:25.247 It addresses one of the FAR 9.4 00:37:25.247 --> 00:37:27.894 present responsibility matters that I'm concerned about, 00:37:27.894 --> 00:37:31.098 and it goes into some of the changes that you've made. 00:37:31.098 --> 00:37:33.165 I'm not going to spend this meeting going over 00:37:33.165 --> 00:37:36.160 everything in your submission, but I do wanna 00:37:36.160 --> 00:37:38.668 talk to the specific concerns I have such as, 00:37:38.668 --> 00:37:41.779 what changes you've made in your corporate structure 00:37:41.779 --> 00:37:46.779 since all this happened, what changes in personnel 00:37:47.375 --> 00:37:51.787 have occurred, what is the culture like in your company, 00:37:51.787 --> 00:37:56.247 and what internal controls do you have in place 00:37:56.247 --> 00:37:59.266 and training in place to ensure that 00:37:59.266 --> 00:38:04.061 you operate with integrity and that bribery 00:38:04.902 --> 00:38:07.178 and any other illegal acts do not occur 00:38:07.178 --> 00:38:10.266 by any company employee? 00:38:10.266 --> 00:38:12.937 Okay, so just so you know, 00:38:12.937 --> 00:38:16.094 Mr. Schmidt you did your homework so you know 00:38:16.094 --> 00:38:18.602 that I don't like to talk to the outside counsel. 00:38:18.602 --> 00:38:21.064 I'd rather talk to the people who work at the company 00:38:21.064 --> 00:38:23.246 because you work there and you know what's going on, 00:38:23.246 --> 00:38:25.615 so I'll be directing most of my questions 00:38:25.615 --> 00:38:30.615 to all of the Clark Industries representatives, okay? 00:38:31.182 --> 00:38:32.209 - Yes, ma'am. 00:38:32.209 --> 00:38:33.719 - Okay, all right. 00:38:33.719 --> 00:38:38.154 So before we go on, anything, just a reminder 00:38:38.154 --> 00:38:42.890 that this meeting, anything you want to be part of record 00:38:42.890 --> 00:38:45.305 as a result of this meeting should actually be 00:38:45.305 --> 00:38:47.813 submitted to me in writing afterwards, 00:38:47.813 --> 00:38:50.135 and we might actually have other requests 00:38:50.135 --> 00:38:51.853 for written submissions afterwards. 00:38:51.853 --> 00:38:54.454 We'll talk about that as we go along the way, 00:38:54.454 --> 00:38:56.892 and you submit those sometime after the meeting, 00:38:56.892 --> 00:38:58.646 they'll become a part of record. 00:38:58.646 --> 00:39:00.741 - There'll be no problem, we can handle that. 00:39:00.741 --> 00:39:01.931 - All right, thank you. 00:39:01.931 --> 00:39:04.717 All right, so to start off, Mike, Mr. Russell, 00:39:04.717 --> 00:39:07.968 you are the CEO, and I was just wondering, 00:39:07.968 --> 00:39:11.544 I have this org. chart here in the submission. 00:39:11.544 --> 00:39:13.634 I was wondering if you could just take me through it, 00:39:13.634 --> 00:39:17.163 and explain to me the company structure. 00:39:17.163 --> 00:39:19.996 - Certainly, and there's a couple of things 00:39:19.996 --> 00:39:22.480 that are pivotal in terms of recent changes 00:39:22.480 --> 00:39:26.381 to our organization since Mr. Clark's misconduct 00:39:26.381 --> 00:39:29.911 became known to all of us in the company. 00:39:29.911 --> 00:39:33.533 One is we have Sarah Drabkin has been 00:39:33.533 --> 00:39:36.877 elevated to Senior Vice President of our Operations 00:39:36.877 --> 00:39:40.104 to ensure that we have effective training 00:39:40.104 --> 00:39:43.007 for all of our people, and that she can 00:39:43.007 --> 00:39:45.933 more closely monitor performance. 00:39:45.933 --> 00:39:50.112 I once did that, but now I have been elevated. 00:39:50.112 --> 00:39:52.643 I didn't have the time to give proper attention, 00:39:52.643 --> 00:39:55.081 we realize how very important this is. 00:39:55.081 --> 00:39:58.262 The other very significant change is we have hired, 00:39:58.262 --> 00:39:59.865 for the first time, a full-time 00:39:59.865 --> 00:40:03.023 ethics and compliance officer, and we have also 00:40:03.023 --> 00:40:05.205 established a Board of Governors. 00:40:05.205 --> 00:40:06.598 - [Maria] Okay, let me ask you this. 00:40:06.598 --> 00:40:09.617 So you're now the CEO and you've been since 2014, 00:40:09.617 --> 00:40:14.447 since around the time when Mr. Clark was indicted? 00:40:14.447 --> 00:40:15.584 - That is correct. 00:40:15.584 --> 00:40:17.558 - So what position did you hold in the company 00:40:17.558 --> 00:40:19.323 before you actually became CEO. 00:40:19.323 --> 00:40:22.109 - I was the Vice President. - [Maria] Okay. 00:40:22.109 --> 00:40:24.385 - And one of the things that I'm sure you're 00:40:24.385 --> 00:40:26.266 probably thinking that ran through my mind 00:40:26.266 --> 00:40:29.307 several times, how could I be the Vice President 00:40:29.307 --> 00:40:32.303 and be with a company for so long, 00:40:32.303 --> 00:40:36.134 and be blind to Mr. Clark's conduct? 00:40:36.134 --> 00:40:41.080 And that had to do with, we had an effective paper program. 00:40:41.080 --> 00:40:45.542 We had all of the little boxes checked if you will, 00:40:45.542 --> 00:40:47.841 in terms of what you need for a program, 00:40:47.841 --> 00:40:51.045 but because of the structure of the company, 00:40:51.045 --> 00:40:53.576 it was not possible for us to see 00:40:53.576 --> 00:40:55.642 the way that it could be manipulated, 00:40:55.642 --> 00:40:57.779 and so we have learned a lot. 00:40:57.779 --> 00:40:59.729 And we've learned that we need a full time, 00:40:59.729 --> 00:41:03.630 very seasoned Compliance and Ethics Officer, 00:41:03.630 --> 00:41:06.927 and we need for her to have total independence 00:41:06.927 --> 00:41:09.946 and if you not in our org. chart, there's a dotted line. 00:41:09.946 --> 00:41:13.591 And she reports directly to the Board of Governors. 00:41:13.591 --> 00:41:17.167 Now I have always held myself out to be ethical 00:41:17.167 --> 00:41:20.963 and I strive to be ethical, but if she should ever 00:41:20.963 --> 00:41:24.353 have a problem with me, she is not constrained 00:41:24.353 --> 00:41:27.139 whatsoever, she can go directly to the Board of Governors, 00:41:27.139 --> 00:41:29.563 and I will have to answer to the Board of Governors. 00:41:29.563 --> 00:41:30.645 - Okay, thank you. 00:41:30.645 --> 00:41:33.246 And so you report up to the Board of Governors, 00:41:33.246 --> 00:41:38.053 and is there some sort of a, quarterly, and Lori you might 00:41:38.053 --> 00:41:40.895 get to this when it comes to you, but is there 00:41:40.895 --> 00:41:42.706 some sort of a quarterly report? 00:41:42.706 --> 00:41:44.773 I know that Lori can actually go to 00:41:44.773 --> 00:41:47.048 the Board of Governors if there's an issue that she has 00:41:47.048 --> 00:41:50.810 that she feels like, the CEO or upper management is not 00:41:50.810 --> 00:41:53.922 handling properly, but is there a routine sort of 00:41:53.922 --> 00:41:57.196 reporting, quarter reporting, to the Board of Governors 00:41:57.196 --> 00:41:59.866 on compliance and ethics? 00:41:59.866 --> 00:42:03.140 - Yes, we feel that reporting on compliance and ethcics 00:42:03.140 --> 00:42:06.484 is equally important with our financial accounting, 00:42:06.484 --> 00:42:10.106 and for the same reasons they monitor our finances 00:42:10.106 --> 00:42:13.450 on a quarterly, semi-annual, and annual basis 00:42:13.450 --> 00:42:17.258 they pulse in and get the reports on our ethics 00:42:17.258 --> 00:42:20.462 and our progress with compliance issues. 00:42:20.462 --> 00:42:23.039 We flag any issues where we've had difficulties, 00:42:23.039 --> 00:42:26.151 so they can monitor our progress, 00:42:26.151 --> 00:42:30.975 see where our obstacles are, and then they can 00:42:32.583 --> 00:42:35.067 provide us with the appropriate resources. 00:42:35.067 --> 00:42:36.995 - Okay, all right you had touched on, before, 00:42:36.995 --> 00:42:41.035 the fact that you've been in this company for so long, 00:42:41.035 --> 00:42:44.286 as a Vice President, and you and nobody else 00:42:44.286 --> 00:42:46.213 knew all of this stuff was going on. 00:42:46.213 --> 00:42:48.698 It seems to me from what I've read, 00:42:48.698 --> 00:42:52.807 of the indictment and the conviction documents 00:42:52.807 --> 00:42:54.897 and everything in your submission 00:42:54.897 --> 00:42:59.788 that because Mr. Clark was the sole owner of the company, 00:43:01.062 --> 00:43:06.062 his actions went undetected, that allowed him to actually do 00:43:06.634 --> 00:43:08.993 whatever he could have done- what he did, 00:43:08.993 --> 00:43:11.292 and that resulted in the bribery charges, 00:43:11.292 --> 00:43:14.125 and so his actions went undetected. 00:43:14.125 --> 00:43:18.188 And it's obvious that you didn't have the proper 00:43:18.188 --> 00:43:20.858 checks and balances in place to address that. 00:43:20.858 --> 00:43:23.714 This Board of Governors seems to be a new thing, 00:43:23.714 --> 00:43:26.965 so was that put in place to address some of these issues? 00:43:26.965 --> 00:43:29.751 - It was, we started as a small company. 00:43:29.751 --> 00:43:32.422 We continued to practice as a small company, 00:43:32.422 --> 00:43:35.092 even though our revenues had grown exponentially, 00:43:35.092 --> 00:43:38.087 and that's what I meant when I said we had 00:43:38.087 --> 00:43:41.408 a paper program, facially it looked appropriate, 00:43:41.408 --> 00:43:45.054 but it was not appropriate for the size company 00:43:45.054 --> 00:43:47.654 that we are, for some of the issues that we had, 00:43:47.654 --> 00:43:50.255 and it did not protect us from the blind spots 00:43:50.255 --> 00:43:54.132 of a misbehaving sole owner. 00:43:54.132 --> 00:43:57.662 Fortunately Mr. Clark was already in the process 00:43:57.662 --> 00:44:02.352 of selling the company when news of the indictment broke. 00:44:02.352 --> 00:44:04.558 The sale has been completed. 00:44:04.558 --> 00:44:07.112 I immediately, upon becoming the CEO 00:44:07.112 --> 00:44:11.640 I immediately took action to ban him from the premises 00:44:11.640 --> 00:44:14.264 and to ensure that he does not have access 00:44:14.264 --> 00:44:19.117 to any of the personnel or IT or other corporate assets. 00:44:19.117 --> 00:44:20.975 - [Maria] So Mr. Clark is completely removed 00:44:20.975 --> 00:44:23.181 from the company, has nothing at all to do with the company? 00:44:23.181 --> 00:44:24.388 - That is correct. 00:44:24.388 --> 00:44:25.665 - [Maria] Does he have any family members 00:44:25.665 --> 00:44:26.942 that work at the company? 00:44:26.942 --> 00:44:31.215 - There are no residual Clark family members. 00:44:31.215 --> 00:44:34.373 - Okay, did he have some family members before? 00:44:34.373 --> 00:44:37.043 - He did, but they're gone now. 00:44:37.043 --> 00:44:39.133 - [Maria] Okay, all right thank you very much. 00:44:39.133 --> 00:44:43.684 All right, so I think I have some questions for Sarah. 00:44:43.684 --> 00:44:44.999 - Sure. 00:44:44.999 --> 00:44:49.445 - Sarah, I understand that you were at the company before. 00:44:49.445 --> 00:44:52.000 You were in another position, I forgot. 00:44:52.000 --> 00:44:54.182 What's the position you had before 00:44:54.182 --> 00:44:55.808 you recently assumed this role? 00:44:55.808 --> 00:44:57.085 - Right, I was the Senior Manager 00:44:57.085 --> 00:44:59.453 of Business Operations previously. 00:44:59.453 --> 00:45:01.078 - [Maria] And why was this role created, 00:45:01.078 --> 00:45:02.843 the new one that you have now, 00:45:02.843 --> 00:45:04.306 why was that created? 00:45:04.306 --> 00:45:07.069 - I think so we have more oversight over everything. 00:45:07.069 --> 00:45:10.529 I think going from a medium company, 00:45:10.529 --> 00:45:13.199 or small company, into a larger one 00:45:13.199 --> 00:45:15.219 we wanted to make sure that the oversight, 00:45:15.219 --> 00:45:17.495 the procedures and policies were in place, 00:45:17.495 --> 00:45:20.746 and by having someone that reports 00:45:20.746 --> 00:45:23.230 directly to me, we could do that. 00:45:23.230 --> 00:45:25.367 - [Maria] Okay, so tell me about your role 00:45:25.367 --> 00:45:27.155 and what you do. 00:45:27.155 --> 00:45:30.777 - So I oversee the operations, 00:45:30.777 --> 00:45:32.913 and what we've done is we've gone ahead 00:45:32.913 --> 00:45:34.864 and created a bunch of checks and balances 00:45:34.864 --> 00:45:37.441 and made sure that the policies that we have now 00:45:37.441 --> 00:45:41.295 are clear and precise, for instance we've 00:45:41.295 --> 00:45:44.175 created a proposal approval system, 00:45:44.175 --> 00:45:47.379 and we have different levels of approval 00:45:47.379 --> 00:45:50.491 so that we can catch anything that we need to. 00:45:50.491 --> 00:45:55.251 Additionally, we've created a Head of Government Contracts 00:45:55.251 --> 00:45:58.641 group which is separate from the rest of our business, 00:45:58.641 --> 00:46:00.893 which we've understood is very important 00:46:00.893 --> 00:46:04.190 because 45% of our business is government contracts. 00:46:04.190 --> 00:46:07.557 - [Maria] Well that's good, so before this 00:46:07.557 --> 00:46:09.601 you really had the government contracts 00:46:09.601 --> 00:46:11.830 mixed in with the commercial business? 00:46:11.830 --> 00:46:13.966 - Correct, as Mike was talking about. 00:46:13.966 --> 00:46:15.591 As a small business we had everything 00:46:15.591 --> 00:46:17.565 kind of a little bit intertwined. 00:46:17.565 --> 00:46:18.680 - [Maria] Okay, I know. 00:46:18.680 --> 00:46:20.630 So this new Government Contracts group 00:46:20.630 --> 00:46:22.766 that you've created, who leads it? 00:46:22.766 --> 00:46:24.972 Who's the leader of that group? 00:46:24.972 --> 00:46:26.900 - So we have a Government Contract Manager now, 00:46:26.900 --> 00:46:28.896 who has experience in government contracts, 00:46:28.896 --> 00:46:30.220 but we're looking for a person 00:46:30.220 --> 00:46:32.101 to actually head that division. 00:46:32.101 --> 00:46:33.494 - [Maria] Okay, so what kind of qualifications 00:46:33.494 --> 00:46:35.119 and experience are you looking for for that person? 00:46:35.119 --> 00:46:37.070 - We've put out a vacancy announcement, 00:46:37.070 --> 00:46:39.601 and we are looking for someone with 00:46:39.601 --> 00:46:43.479 a huge knowledge of government contracts. 00:46:43.479 --> 00:46:46.010 We want to make sure that they are 00:46:46.010 --> 00:46:48.192 extremely qualified and experienced in 00:46:48.192 --> 00:46:50.461 all of the nuances that government contracts have. 00:46:50.461 --> 00:46:51.994 - [Maria] So you're looking for somebody who 00:46:51.994 --> 00:46:54.050 probably had experience doing something 00:46:54.050 --> 00:46:55.805 similar in another company, - Absolutely. 00:46:55.805 --> 00:46:57.358 - [Maria] and that has run it successfully? 00:46:57.358 --> 00:46:58.126 - Yes 00:46:58.126 --> 00:47:00.795 - [Maria] All right, so I want to be kept informed 00:47:00.795 --> 00:47:03.466 of when you actually do hire that person, 00:47:03.466 --> 00:47:06.368 and I'd also like to get a copy of their resume 00:47:06.368 --> 00:47:08.644 once you've hired them. 00:47:08.644 --> 00:47:09.735 - That's not a problem. 00:47:09.735 --> 00:47:10.919 - [Maria] Okay, all right- 00:47:10.919 --> 00:47:13.752 - Before we progress, are you asking for 00:47:13.752 --> 00:47:16.283 the resume before we actually hire someone? 00:47:16.283 --> 00:47:18.443 - [Maria] No, no just afterwards. 00:47:18.443 --> 00:47:20.509 After you've done your hiring, I just need to know 00:47:20.509 --> 00:47:22.993 the name of the person, and their resume. 00:47:22.993 --> 00:47:23.946 - No problem. 00:47:23.946 --> 00:47:26.662 - I trust that you are going to hire 00:47:26.662 --> 00:47:29.542 somebody that is qualified. (laughs) 00:47:29.542 --> 00:47:32.813 So, give me an example, you said 00:47:32.813 --> 00:47:34.903 the checks and balances you put in place, 00:47:34.903 --> 00:47:37.341 you said, like your proposal approval system, 00:47:37.341 --> 00:47:40.522 I'm assuming you're saying now that you've put one in place 00:47:40.522 --> 00:47:43.448 that there was not one in place before? 00:47:43.448 --> 00:47:46.466 Was it that the person who put together a proposal 00:47:46.466 --> 00:47:49.833 probably only had to go through one level of approval, 00:47:49.833 --> 00:47:53.223 and now are you saying there are multiple layers? 00:47:53.223 --> 00:47:54.988 - That's correct, and I think that 00:47:54.988 --> 00:47:57.357 they weren't actually written out policies and procedures 00:47:57.357 --> 00:47:59.237 in terms of an approval system, 00:47:59.237 --> 00:48:01.466 so now anyone who steps into a position 00:48:01.466 --> 00:48:05.228 is well aware of what their responsibilities are. 00:48:05.228 --> 00:48:07.504 - [Maria] Okay, I remember seeing that in the submission, 00:48:07.504 --> 00:48:10.360 thanks for refreshing my memory. 00:48:10.360 --> 00:48:13.262 Okay, is there anything else that you'd like to tell me 00:48:13.262 --> 00:48:15.793 about the changes that have occurred? 00:48:16.863 --> 00:48:20.228 - I think that's it, I just wanna make sure to emphasize 00:48:20.228 --> 00:48:22.573 that we've put in all these different procedures 00:48:22.573 --> 00:48:25.035 and that I've come from a larger company, 00:48:25.035 --> 00:48:28.007 previously, when we were growing, 00:48:28.007 --> 00:48:30.700 and I was able to implement these procedures and policies 00:48:30.700 --> 00:48:33.533 there, and I think they really are working here. 00:48:33.533 --> 00:48:36.900 - [Maria] So you do have experience in moving a company 00:48:36.900 --> 00:48:39.942 from that small business mindset to a larger business, 00:48:39.942 --> 00:48:40.781 - Exactly. 00:48:40.781 --> 00:48:42.226 - [Maria] and that's what you did before. 00:48:42.226 --> 00:48:43.866 - And I believe that's why I was brought on, yes. 00:48:43.866 --> 00:48:44.784 - [Maria] Okay, all right. 00:48:44.784 --> 00:48:46.996 And I understand that you also created 00:48:46.996 --> 00:48:49.341 and ethics and compliance division? 00:48:49.341 --> 00:48:52.081 - That's correct, that Lori can talk more about. 00:48:52.081 --> 00:48:53.730 - [Maria] All right, Lori. 00:48:53.730 --> 00:48:56.284 Ready to just talk to me about- 00:48:56.284 --> 00:48:57.399 - Sure. 00:48:57.399 --> 00:48:59.140 - [Maria] your ethics and compliance. 00:48:59.140 --> 00:49:01.091 - Mike discussed previously that I do 00:49:01.091 --> 00:49:03.064 a presentation before the Board of Governors 00:49:03.064 --> 00:49:04.806 in their quarterly meetings, but there's 00:49:04.806 --> 00:49:07.824 an open-door policy that I am free to 00:49:07.824 --> 00:49:10.355 go directly to the Board of Governors, Mike, 00:49:10.355 --> 00:49:13.699 or to Sarah if I have any issues or concerns 00:49:13.699 --> 00:49:15.900 that need to be addressed immediately. 00:49:17.321 --> 00:49:21.547 When I first arrived, I did a comprehensive risk assessment 00:49:21.547 --> 00:49:25.843 and when we conducted it, I spoke with the CFO, 00:49:25.843 --> 00:49:28.885 the Chief Financial Officer, personnel, 00:49:28.885 --> 00:49:31.927 general counsel's office, talked to 00:49:31.927 --> 00:49:35.735 human resources division, external audits 00:49:35.735 --> 00:49:39.775 and internal auditors, some of our environmental health 00:49:39.775 --> 00:49:42.794 and safety people, but the program managers, 00:49:42.794 --> 00:49:44.837 and from there we determined where were 00:49:44.837 --> 00:49:46.230 the biggest risks, so that we could 00:49:46.230 --> 00:49:49.806 develop a strong ethics and compliance program. 00:49:49.806 --> 00:49:51.664 - [Maria] So what did you find to be 00:49:51.664 --> 00:49:52.825 your biggest risk area? 00:49:52.825 --> 00:49:55.913 - Well, there did need to be revisions 00:49:55.913 --> 00:49:58.862 in the Code of Conduct, but another part of it 00:49:58.862 --> 00:50:03.862 was, you know, Mike has been very supportive of our efforts 00:50:04.427 --> 00:50:07.840 to totally revise the tone at the top, the culture, 00:50:07.840 --> 00:50:09.837 and so one of the first things he did, 00:50:09.837 --> 00:50:13.018 is we did revise and strengthen our Code of Conduct. 00:50:13.018 --> 00:50:16.246 But he issued on top of that a letter to all employees 00:50:16.246 --> 00:50:18.823 saying, look everyone is held accountable. 00:50:18.823 --> 00:50:21.354 It doesn't matter if it's him as the CEO, 00:50:21.354 --> 00:50:23.908 or the Board of Governors, everyone is, 00:50:23.908 --> 00:50:28.645 and emphasized that there was a non-retaliation program. 00:50:28.645 --> 00:50:30.898 Although there was a hotline implemented, 00:50:30.898 --> 00:50:32.686 and you know we have a private contractor doing it, 00:50:32.686 --> 00:50:36.819 so there's anonymity, we didn't really see many complaints. 00:50:36.819 --> 00:50:39.861 And so we found that after Mike had issued this letter 00:50:39.861 --> 00:50:44.087 and said, we totally believe in a non-retaliation program, 00:50:44.087 --> 00:50:46.873 if you in good faith raise complaints, 00:50:46.873 --> 00:50:49.984 nothing will happen to you, and in fact 00:50:49.984 --> 00:50:53.308 Mike has, can probably explain to you, 00:50:53.308 --> 00:50:55.325 he actually has kind of a bonus program 00:50:55.325 --> 00:50:59.621 where it's a, you know, they're rewarded for coming forth. 00:50:59.621 --> 00:51:01.339 - [Maria] Oh, really? Tell me about that Mike. 00:51:01.339 --> 00:51:05.333 - Well, when I said before that we had a facially acceptable 00:51:05.333 --> 00:51:09.559 program before, we had the perfunctory training, 00:51:09.559 --> 00:51:14.559 but we have realized now that that is not sufficient. 00:51:14.807 --> 00:51:19.335 We had to weave in to the fabric of the culture itself, 00:51:19.335 --> 00:51:22.214 on a daily basis with different signals 00:51:22.214 --> 00:51:25.279 that the employees would clearly receive. 00:51:25.279 --> 00:51:28.391 Part of that is if we have a hotline complaint, 00:51:28.391 --> 00:51:30.922 or just a complaint where the person comes forward 00:51:30.922 --> 00:51:34.915 directly and it's validated that they identified 00:51:34.915 --> 00:51:38.398 a shortcoming, we have a bonus program 00:51:38.398 --> 00:51:40.929 and it's tiered basically to the degree 00:51:40.929 --> 00:51:42.903 of the potential damage to 00:51:42.903 --> 00:51:45.852 the corporate image of our company. 00:51:45.852 --> 00:51:49.823 Sometimes it's time off, sometimes it's cash. 00:51:49.823 --> 00:51:53.491 We have woven in to the annual evaluations 00:51:53.491 --> 00:51:58.460 the requirement for ethics and compliance issues. 00:51:58.460 --> 00:52:02.524 We also use the other half of the carrot, if you will, 00:52:02.524 --> 00:52:06.193 and that if we become aware of misconduct, 00:52:06.193 --> 00:52:08.956 that the employee is held accountable. 00:52:08.956 --> 00:52:11.881 We do not say, it was Jane or John 00:52:11.881 --> 00:52:16.706 but we mask the specific identity, but we put it on our blog 00:52:17.895 --> 00:52:20.496 so that the employees are aware that there is 00:52:20.496 --> 00:52:24.444 a reward for doing ethical things and there is a punishment 00:52:24.444 --> 00:52:28.461 for failure to comply with our cultural norm. 00:52:28.461 --> 00:52:32.571 And I've found that by working with Lori and Sarah, 00:52:32.571 --> 00:52:36.518 weaving it into the educational format, 00:52:36.518 --> 00:52:39.606 the operational format, the monitoring format, 00:52:39.606 --> 00:52:42.160 and giving day to day feedback, 00:52:42.160 --> 00:52:45.481 that it now is not just a paper program, 00:52:45.481 --> 00:52:48.035 it's not a box that's been checked. 00:52:48.035 --> 00:52:51.472 It is something that is actually part of our culture, 00:52:51.472 --> 00:52:55.605 and the employees have warmed to that. 00:52:55.605 --> 00:52:57.509 There was a little apprehension at first, 00:52:57.509 --> 00:52:59.784 but they have warmed to it now 00:52:59.784 --> 00:53:01.688 and they're actually coming forward. 00:53:01.688 --> 00:53:04.544 And sometimes they bring things to our attention 00:53:04.544 --> 00:53:08.445 that really isn't inappropriate, but that's not a bad thing 00:53:08.445 --> 00:53:10.582 because it let's us know that we need to work on 00:53:10.582 --> 00:53:13.316 our education to ensure that people 00:53:13.316 --> 00:53:15.551 understand things in context. 00:53:15.551 --> 00:53:16.712 - Oh, that's good. 00:53:16.712 --> 00:53:18.453 Now back to Lori, the hotline. 00:53:18.453 --> 00:53:21.170 Well first of all, I tried the number and it works. 00:53:21.170 --> 00:53:24.026 You'd be amazed at sometimes we get these numbers 00:53:24.026 --> 00:53:25.582 and they're not in service. 00:53:25.582 --> 00:53:26.502 (laughter) 00:53:26.502 --> 00:53:28.546 So yours works, that's a good thing, right? 00:53:28.546 --> 00:53:29.916 And second, just give me some examples 00:53:29.916 --> 00:53:34.820 of hotline calls you've received and how you handled it. 00:53:34.820 --> 00:53:36.677 - A majority of the hotline complaints are 00:53:36.677 --> 00:53:38.163 personnel issues, complaints about 00:53:38.163 --> 00:53:41.321 the way a manager is supervising them perhaps. 00:53:41.321 --> 00:53:44.340 But occasionally we have had situations in which, 00:53:44.340 --> 00:53:47.057 we had an instance where somebody complained 00:53:47.057 --> 00:53:49.355 about time and attendance on a government contract. 00:53:49.355 --> 00:53:54.110 It was investigated promptly, we have investigative policies 00:53:55.322 --> 00:53:57.668 on how it's to be conducted. 00:53:57.668 --> 00:54:00.129 It was validated, and the employee, 00:54:00.129 --> 00:54:02.892 a 10 year employee, was fired. 00:54:02.892 --> 00:54:05.725 Because obviously it's a false claim as to 00:54:05.725 --> 00:54:08.349 the hours being performed for the government. 00:54:08.349 --> 00:54:11.019 And then it was posted on the intranet blog. 00:54:11.019 --> 00:54:14.270 It's only accessible by employees, 00:54:14.270 --> 00:54:18.612 but we give them instances of when the Code of Conduct 00:54:18.612 --> 00:54:21.189 has been violated, and what the consequences are, 00:54:21.189 --> 00:54:24.092 so that they do understand there's accountability. 00:54:25.192 --> 00:54:27.946 And we found that by taking a lot of the 00:54:27.946 --> 00:54:31.429 often-asked questions that are submitted 00:54:31.429 --> 00:54:34.216 to the hotline, and addressing it on the blog, 00:54:34.216 --> 00:54:35.911 you know if two or three employees have 00:54:35.911 --> 00:54:38.395 the same question, then probably everybody else 00:54:38.395 --> 00:54:41.205 is thinking it and just hasn't expressed it. 00:54:41.205 --> 00:54:44.038 So we use that blog just kind of as a way to 00:54:44.038 --> 00:54:46.290 communicate when there are concerns. 00:54:46.290 --> 00:54:51.290 I think it's opened up the air for employees 00:54:51.445 --> 00:54:54.255 to finally express things, I think morale has 00:54:54.255 --> 00:54:55.805 improved because of it. 00:54:55.805 --> 00:54:57.737 - I agree wholeheartedly. 00:54:57.737 --> 00:55:00.292 - Obviously some people were very concerned 00:55:00.292 --> 00:55:03.148 about Mr. Clark's conduct, no one felt 00:55:03.148 --> 00:55:07.652 free to say any comments, and we did, 00:55:07.652 --> 00:55:11.321 that was the first example on our intranet blog, 00:55:11.321 --> 00:55:15.083 was discussing what had happened, and the consequences. 00:55:15.083 --> 00:55:17.289 In addition we have a training program. 00:55:17.289 --> 00:55:20.284 Our ethics and compliance training program, 00:55:20.284 --> 00:55:22.583 which is mandatory for all employees. 00:55:22.583 --> 00:55:26.228 It is based on the risk inherent in those 00:55:26.228 --> 00:55:28.875 particular programs, so not everybody gets 00:55:28.875 --> 00:55:32.289 the exact same training, but in order to 00:55:32.289 --> 00:55:34.681 enforce it, what we did was, 00:55:34.681 --> 00:55:37.351 it's online training, there are questions asked, 00:55:37.351 --> 00:55:40.950 but failure to do so will mean 00:55:40.950 --> 00:55:43.597 that you don't get your next paycheck. 00:55:43.597 --> 00:55:45.663 And we found that it's a wonderful way 00:55:45.663 --> 00:55:47.405 of ensuring 100% compliance. 00:55:47.405 --> 00:55:51.352 Within 30 days of arriving at our company, 00:55:51.352 --> 00:55:53.976 Clark Industries, you have to complete 00:55:53.976 --> 00:55:58.162 the first preliminary ethics and compliance training. 00:55:58.162 --> 00:55:59.802 - [Maria] And so there's a certification 00:55:59.802 --> 00:56:00.987 tracking process that- 00:56:00.987 --> 00:56:03.167 - There is, they certify it, and then annually 00:56:03.167 --> 00:56:05.768 all employees must be trained. 00:56:05.768 --> 00:56:07.625 - And if I could just add on, I wanted to 00:56:07.625 --> 00:56:09.111 make sure that you're aware, 00:56:09.111 --> 00:56:10.644 our Government Contracts Division 00:56:10.644 --> 00:56:12.502 has its own specialized training 00:56:12.502 --> 00:56:15.224 for that particular thing as well. 00:56:15.224 --> 00:56:17.086 - [Maria] All right, that's good. 00:56:17.086 --> 00:56:21.011 - And one of the benefits of our former CEO 00:56:21.011 --> 00:56:22.822 being indicted and removed from- 00:56:22.822 --> 00:56:24.493 - [Maria] There's benefits? 00:56:24.493 --> 00:56:26.741 (laughter) 00:56:26.741 --> 00:56:29.997 - The benefit is that it showed the employees 00:56:29.997 --> 00:56:31.826 that people are accountable. 00:56:31.826 --> 00:56:32.760 - [Maria] Right. 00:56:32.760 --> 00:56:35.848 - Because before, there was, in hindsight I can say, 00:56:35.848 --> 00:56:39.099 things I didn't see then, there was the culture 00:56:39.099 --> 00:56:42.977 of actually advocating ethics and compliance, 00:56:42.977 --> 00:56:46.715 and having training, but there was this sense 00:56:46.715 --> 00:56:50.314 that maybe at the very top there was not buy-in. 00:56:50.314 --> 00:56:54.617 And so we've shifted radically in terms of the culture, 00:56:54.617 --> 00:56:57.519 and as Lori mentioned it has had 00:56:57.519 --> 00:57:00.282 a pronounced impact on the morale. 00:57:00.282 --> 00:57:02.511 - [Maria] Okay, all right well that's good. 00:57:02.511 --> 00:57:03.951 - Lori, I think if we could, 00:57:03.951 --> 00:57:06.714 could you provide a copy of maybe the 00:57:06.714 --> 00:57:08.526 introductory training program 00:57:08.526 --> 00:57:10.406 and the government contracts specific- 00:57:10.406 --> 00:57:11.962 - We'd be happy to give you the powerpoints, 00:57:11.962 --> 00:57:13.541 maybe a sample blog? 00:57:13.541 --> 00:57:15.375 - [Michael] Yeah, I think that'd be helpful. 00:57:15.375 --> 00:57:18.510 - In addition to that, you mentioned the hotline usage. 00:57:18.510 --> 00:57:21.366 Could you provide those hotline usage reports to us as well? 00:57:21.366 --> 00:57:24.199 - Certainly, we'll give you the hotline, the allegation, 00:57:24.199 --> 00:57:27.682 generally what response was done, 00:57:27.682 --> 00:57:32.645 and if any personnel action, or whether there were any 00:57:32.645 --> 00:57:36.084 program safety improvements or other program improvements 00:57:36.084 --> 00:57:38.244 were made, we'll give you the final result 00:57:38.244 --> 00:57:39.776 because we do track it. 00:57:39.776 --> 00:57:42.795 We found that when you track compliance, that's a way 00:57:42.795 --> 00:57:46.147 you make sure it's actually addressed in the end. 00:57:46.147 --> 00:57:48.356 - [Dillon] Wonderful. - So we've done that. 00:57:48.356 --> 00:57:49.510 - [Dillon] Thank you. 00:57:49.510 --> 00:57:52.070 - Thank you, so one of the things I've noticed since, 00:57:52.070 --> 00:57:55.297 Mr. Clark is the 100% owner of the company, 00:57:55.297 --> 00:57:57.387 or was the 100% owner of the company 00:57:57.387 --> 00:58:01.613 and he was convicted, I noticed there were no charges 00:58:01.613 --> 00:58:05.909 filed against the company, can you speak to that? 00:58:05.909 --> 00:58:08.091 - Yes, I can do that, I'd be happy to. 00:58:08.091 --> 00:58:09.531 It will also allow me to highlight 00:58:09.531 --> 00:58:10.831 some of the other elements that shows 00:58:10.831 --> 00:58:12.410 our present responsibility. 00:58:12.410 --> 00:58:13.236 - [Maria] Mm-hmm. 00:58:13.236 --> 00:58:14.950 - Well we at the company knew nothing about 00:58:14.950 --> 00:58:16.963 Mr. Clark's actions until the day that 00:58:16.963 --> 00:58:20.306 his indictment was unsealed, and then we immediately 00:58:20.306 --> 00:58:23.069 took the action to start an internal investigation, 00:58:23.069 --> 00:58:25.624 which we shared with you in or response. 00:58:25.624 --> 00:58:29.641 We also brought in outside experts to help us 00:58:29.641 --> 00:58:31.847 with the investigation and conduct audits. 00:58:31.847 --> 00:58:33.518 Some of the things we had to find out were, 00:58:33.518 --> 00:58:36.212 was there anybody else involved in this misconduct? 00:58:36.212 --> 00:58:41.212 And also to find out if there was anything that happened 00:58:41.896 --> 00:58:45.124 that we still didn't know about, and take care of that. 00:58:45.124 --> 00:58:48.653 What we did uncover was a lot of the gaps 00:58:48.653 --> 00:58:52.391 that Lori and Sarah and Mike have already discussed, 00:58:52.391 --> 00:58:55.851 and taken the actions to correct those. 00:58:57.291 --> 00:59:02.071 But we also totally cooperated with the DOJ investigation, 00:59:02.071 --> 00:59:05.023 as a matter of fact we opened up all of our records 00:59:05.023 --> 00:59:08.088 and gave them full access to our employees, systems, 00:59:08.088 --> 00:59:11.687 and during their investigation they found 00:59:11.687 --> 00:59:14.868 that there was no other perpetrators involved 00:59:14.868 --> 00:59:17.887 and that there was no other misconduct that they uncovered, 00:59:17.887 --> 00:59:21.486 and so that's why they brought no charges to the company 00:59:21.486 --> 00:59:23.344 or anybody else in the company. 00:59:23.344 --> 00:59:25.108 - Okay, well thank you. 00:59:25.108 --> 00:59:27.105 I understand Mr. Clark is no longer connected 00:59:27.105 --> 00:59:30.751 to the company, and so in that respect 00:59:30.751 --> 00:59:32.841 the source of the misconduct that lead to 00:59:32.841 --> 00:59:35.023 this conviction has been eliminated. 00:59:35.023 --> 00:59:37.415 But I guess, Mike I'll direct this to you, 00:59:37.415 --> 00:59:39.226 being at the company the longest, 00:59:39.226 --> 00:59:41.687 do you think sufficient time has passed 00:59:41.687 --> 00:59:44.636 for the changes that you have put in place 00:59:44.636 --> 00:59:46.749 to take root, and the culture change 00:59:46.749 --> 00:59:49.420 that has to take place to ensure that you 00:59:49.420 --> 00:59:53.576 as a company continue to improve, 00:59:53.576 --> 00:59:57.082 and/or act ethically going forward? 00:59:57.082 --> 01:00:01.912 - I will answer that in a bifurcated way. 01:00:01.912 --> 01:00:04.884 For today, yes, however if we do not 01:00:04.884 --> 01:00:08.901 continue with these changes on a day to day basis, 01:00:08.901 --> 01:00:11.827 incorporating it into the actual culture 01:00:11.827 --> 01:00:13.754 and fabric of the organization, 01:00:13.754 --> 01:00:15.821 even though that's where we are today, 01:00:15.821 --> 01:00:17.632 that may not be where we're at tomorrow 01:00:17.632 --> 01:00:20.116 or next week, but we are committed to 01:00:20.116 --> 01:00:24.551 doing this every day, working with Sarah and her team 01:00:24.551 --> 01:00:27.222 with operations and training, 01:00:27.222 --> 01:00:31.192 and Lori with compliance and ethics and training, 01:00:31.192 --> 01:00:33.630 and working with our counsel to make sure 01:00:33.630 --> 01:00:36.964 that we're cognizant of the laws, rules, regulations, 01:00:36.964 --> 01:00:40.772 specific requirements for each of our undertakings. 01:00:40.772 --> 01:00:43.883 As Sarah pointed out, dealing with the government 01:00:43.883 --> 01:00:45.834 is very much different from dealing with 01:00:45.834 --> 01:00:48.295 the commercial setting. 01:00:48.295 --> 01:00:51.174 I will say this was deeply embarrassing for all of us 01:00:51.174 --> 01:00:54.007 at Clark Industry, I did a lot of soul searching 01:00:54.007 --> 01:00:57.908 as being the number two while this was going on. 01:00:57.908 --> 01:01:00.927 We realize now that we needed to, 01:01:00.927 --> 01:01:03.527 take additional steps, we've taken those steps. 01:01:03.527 --> 01:01:05.710 We understand we're a work in progress, 01:01:05.710 --> 01:01:08.729 any business is always going to be a work in progress. 01:01:08.729 --> 01:01:12.049 We screen people as effectively as possible 01:01:12.049 --> 01:01:15.857 during the hiring process, we have minimum training 01:01:15.857 --> 01:01:17.947 depending upon their job. 01:01:17.947 --> 01:01:20.733 We have minimum levels of ethics training, 01:01:20.733 --> 01:01:22.707 again depending upon the job. 01:01:22.707 --> 01:01:25.354 We have positive and negative rewards built 01:01:25.354 --> 01:01:28.814 into the evaluation system, the compensation system, 01:01:28.814 --> 01:01:31.740 but we understand that we have to 01:01:31.740 --> 01:01:36.439 remain vigilant, that this is a day by day forever situation 01:01:37.405 --> 01:01:39.843 if we're going to have our corporate image 01:01:39.843 --> 01:01:41.887 as one of integrity and honor, 01:01:41.887 --> 01:01:43.651 which is very important to us. 01:01:43.651 --> 01:01:45.671 And I know it must be important to you, 01:01:45.671 --> 01:01:47.668 because you have to know if you can trust us, 01:01:47.668 --> 01:01:51.546 and I sit here today and tell you, today you can 01:01:51.546 --> 01:01:54.495 definitely trust Clark Industries, and tomorrow 01:01:54.495 --> 01:01:56.120 you can rest assured we're still 01:01:56.120 --> 01:01:58.582 going to be ethical and honorable. 01:01:58.582 --> 01:02:00.091 - [Maria] Well thank you. 01:02:00.091 --> 01:02:01.531 Does anybody have any questions? 01:02:01.531 --> 01:02:02.970 Is there anything I missed, or- 01:02:02.970 --> 01:02:05.478 - Yeah, I just wanted to ask Barry, 01:02:05.478 --> 01:02:07.429 you mentioned the internal investigation. 01:02:07.429 --> 01:02:09.379 The internal report came from that, 01:02:09.379 --> 01:02:11.608 I think I remember it being in you submission, 01:02:11.608 --> 01:02:13.698 but I just wanted to double check. 01:02:13.698 --> 01:02:15.927 - Yes, it was but we can always provide 01:02:15.927 --> 01:02:17.096 other copies if you need them. 01:02:17.096 --> 01:02:18.830 - [Michael] No, that's good, I just want to make sure 01:02:18.830 --> 01:02:19.627 that we've seen it and- 01:02:19.627 --> 01:02:21.268 - [Dillon] I do believe it was in the submission. 01:02:21.268 --> 01:02:22.240 - [Michael] Great, excellent. 01:02:22.240 --> 01:02:23.699 And then, I just wanted to kind of wrap up 01:02:23.699 --> 01:02:25.278 the things that we've asked for you guys 01:02:25.278 --> 01:02:27.275 to submit after the meeting. 01:02:27.275 --> 01:02:29.249 The resume of whomever you hire 01:02:29.249 --> 01:02:31.431 in the Government Contracts Management position. 01:02:31.431 --> 01:02:34.543 A copy of the training and an example of the blog, 01:02:34.543 --> 01:02:36.790 and then the hotline usage report. 01:02:38.072 --> 01:02:39.604 Is that everything? 01:02:39.604 --> 01:02:40.597 - Yeah. - Yeah. 01:02:40.597 --> 01:02:41.297 - Great. 01:02:41.297 --> 01:02:42.877 - And if there's any other thing you think 01:02:42.877 --> 01:02:46.611 you need to submit, then please go ahead and do so. 01:02:46.611 --> 01:02:50.047 One last question about, you said you have 01:02:50.047 --> 01:02:52.950 the vacancy announcement out. 01:02:52.950 --> 01:02:54.738 About what's the time period you think 01:02:54.738 --> 01:02:57.013 you might have somebody on board 01:02:57.013 --> 01:02:58.685 for this new government contracts position? 01:02:58.685 --> 01:02:59.916 - Well we would hope tomorrow, 01:02:59.916 --> 01:03:01.982 but we're looking within the next month. 01:03:01.982 --> 01:03:04.165 We want to make sure that we vet everyone 01:03:04.165 --> 01:03:06.928 and select the best candidate, so we're going to 01:03:06.928 --> 01:03:09.895 start the interview processes next week. 01:03:11.255 --> 01:03:13.058 - And as you might imagine, 01:03:13.058 --> 01:03:15.322 with our government portfolio being 45% 01:03:15.322 --> 01:03:18.364 of our business, we're very anxious and nervous 01:03:18.364 --> 01:03:21.243 at this time, and I would ask if you have a 01:03:21.243 --> 01:03:25.121 projected timeline for when you will reach your decision? 01:03:25.121 --> 01:03:27.373 - Okay, well what I can tell you is that 01:03:27.373 --> 01:03:30.879 based on the submission and our meeting today, 01:03:30.879 --> 01:03:33.828 that I believe that you have, first of all, 01:03:33.828 --> 01:03:37.311 you've addressed my concerns about the company culture, 01:03:37.311 --> 01:03:39.355 about the changes that you have made. 01:03:39.355 --> 01:03:41.398 I didn't know before coming to this meeting 01:03:41.398 --> 01:03:43.720 that Mr. Stark is no longer associated with the company. 01:03:43.720 --> 01:03:44.672 - Mr. Clark. 01:03:44.672 --> 01:03:46.390 - Mr. Clark, I'm sorry (laughs) is no longer 01:03:46.390 --> 01:03:48.086 associated with the company, so that- 01:03:48.086 --> 01:03:49.455 - Neither is Mr. Stark. 01:03:49.455 --> 01:03:51.220 (laughter) 01:03:51.220 --> 01:03:52.892 - That's good to know! 01:03:52.892 --> 01:03:55.980 That's good because it eliminates the biggest risk 01:03:55.980 --> 01:03:57.606 that you have, so that puts you in 01:03:57.606 --> 01:03:59.904 a much better position than I thought you were in 01:03:59.904 --> 01:04:02.203 before you came to meet with me. 01:04:02.203 --> 01:04:05.199 So, and I see that you've candidly answered my questions, 01:04:05.199 --> 01:04:07.521 you've admitted where there have been gaps, 01:04:07.521 --> 01:04:08.891 and where you're working on, 01:04:08.891 --> 01:04:11.073 and you've made the appropriate changes, and put the 01:04:11.073 --> 01:04:13.976 proper controls in place in the reporting relationship. 01:04:13.976 --> 01:04:17.227 So I think that's all good, I don't see any reason 01:04:17.227 --> 01:04:20.918 why I would take any administrative action 01:04:20.918 --> 01:04:23.565 against the company at this point at all. 01:04:23.565 --> 01:04:26.886 But what my decision will rest on, 01:04:26.886 --> 01:04:29.556 not rest on, I've made the decision, 01:04:29.556 --> 01:04:33.388 but the quicker you send me the documents 01:04:33.388 --> 01:04:35.385 that we've asked for, the record, the quicker 01:04:35.385 --> 01:04:38.055 we'll send you a letter terminating the review 01:04:38.055 --> 01:04:39.820 and letting you know that 01:04:39.820 --> 01:04:44.231 I've decided there's no need to take action at this time, 01:04:44.231 --> 01:04:46.066 and then of course I will follow up 01:04:46.066 --> 01:04:49.038 with the resume of whoever it is you hire 01:04:49.038 --> 01:04:52.381 for the position, but I just want to thank you so much 01:04:52.381 --> 01:04:54.518 for coming in to meet with me, 01:04:54.518 --> 01:04:57.676 and I appreciate the candor and the information 01:04:57.676 --> 01:05:00.369 you've passed on, and for alleviating 01:05:00.369 --> 01:05:02.157 the concerns that we have. 01:05:02.157 --> 01:05:03.039 All right? 01:05:03.039 --> 01:05:03.782 - [Sarah] Thank you. - [Mike] Thank you. 01:05:03.782 --> 01:05:05.292 - [Lori] Thank you. - [Barry] Thank you very much. 01:05:05.292 --> 01:05:07.916 - Dillon will escort you out. - Thank you very much. 01:05:07.916 --> 01:05:09.402 - Hi, this is Maria Swaby again, 01:05:09.402 --> 01:05:11.631 and I'm the GSA Suspension and Debarment Official. 01:05:11.631 --> 01:05:13.906 Thank you for watching the role-play, 01:05:13.906 --> 01:05:15.462 and I'm going to spend a few minutes 01:05:15.462 --> 01:05:18.690 just explaining to you why in my eyes as the SDO, 01:05:18.690 --> 01:05:20.524 the role-play, the meeting with 01:05:20.524 --> 01:05:22.753 the SDO and the contractor was a success. 01:05:22.753 --> 01:05:26.422 Number one, they provided written materials 01:05:26.422 --> 01:05:29.348 a week in advance of the meeting. 01:05:29.348 --> 01:05:32.204 That gave me and my staff enough time 01:05:32.204 --> 01:05:35.315 to properly review the documents. 01:05:35.315 --> 01:05:39.077 The actual submission had laid out the corrective actions 01:05:39.077 --> 01:05:42.676 that the company had taken since the bribery conviction, 01:05:42.676 --> 01:05:47.366 and it went through the FAR 9.4 presently responsibility 01:05:47.366 --> 01:05:50.455 determinations and gave evidence as to 01:05:50.455 --> 01:05:53.125 why they were presently responsible. 01:05:53.125 --> 01:05:55.099 Second, the contractor brought 01:05:55.099 --> 01:05:56.979 the right people to the meeting. 01:05:56.979 --> 01:05:59.301 They brought people that were knowledgable 01:05:59.301 --> 01:06:01.951 of the events that occurred at the company, 01:06:01.951 --> 01:06:03.760 people who were in charge, 01:06:03.760 --> 01:06:07.034 and who had the power to effectuate change. 01:06:07.034 --> 01:06:10.076 Also, during the meeting, the company representatives 01:06:10.076 --> 01:06:13.071 led the discussion, rather than the outside counsel. 01:06:13.071 --> 01:06:15.718 Another reason why the meeting was a success 01:06:15.718 --> 01:06:18.110 was that the company did not re-litigate 01:06:18.110 --> 01:06:21.871 the case that led to the conviction of Mr. Clark, 01:06:21.871 --> 01:06:24.774 the company actually accepted responsibility 01:06:24.774 --> 01:06:29.774 for his actions, and actually took responsibility 01:06:30.180 --> 01:06:33.017 for the gaps that were in their company culture 01:06:33.017 --> 01:06:36.082 and pointed out how they took care of those gaps 01:06:36.082 --> 01:06:38.590 by implementing remedial measures. 01:06:38.590 --> 01:06:42.235 This acceptance of responsibility allowed 01:06:42.235 --> 01:06:46.368 the SDO and the contractor to focus on 01:06:46.368 --> 01:06:49.549 the company's present and future responsibility, 01:06:49.549 --> 01:06:51.500 and did not spend time going over things 01:06:51.500 --> 01:06:53.590 that happened in the past. 01:06:53.590 --> 01:06:56.330 The other reason why the meeting was a success 01:06:56.330 --> 01:06:58.745 was because the company discussed in detail the changes 01:06:58.745 --> 01:07:02.669 that were made to the corporation during the time 01:07:02.669 --> 01:07:06.988 between the conviction and the meeting with me. 01:07:06.988 --> 01:07:08.961 They discussed for example, the changes in 01:07:08.961 --> 01:07:10.494 the corporate reporting structure, 01:07:10.494 --> 01:07:13.257 the institution of a Board of Governors 01:07:13.257 --> 01:07:15.324 and a reshuffling of staff to make sure 01:07:15.324 --> 01:07:19.103 that there was adequate management at the top. 01:07:20.060 --> 01:07:23.497 Also, the company used the right tone with the SDO. 01:07:23.497 --> 01:07:26.098 They spoke with candor, they were transparent, 01:07:26.098 --> 01:07:29.488 and they allowed the SDO to see into their company 01:07:29.488 --> 01:07:31.787 and their processes and they were very open 01:07:31.787 --> 01:07:33.615 and honest in their presentation. 01:07:34.480 --> 01:07:38.172 And finally, the company was prepared to address 01:07:38.172 --> 01:07:41.585 specific concerns that the SDO had. 01:07:41.585 --> 01:07:43.536 They talked about the corporate culture, 01:07:43.536 --> 01:07:46.276 they talked about training, ethics, compliance, 01:07:46.276 --> 01:07:48.435 and they even talked about the fact that 01:07:48.435 --> 01:07:52.220 they have created a new Government Contracts Unit 01:07:52.220 --> 01:07:54.635 to separate their government contracts 01:07:54.635 --> 01:07:56.701 from their commercial business. 01:07:56.701 --> 01:07:58.164 Thank you for taking the time today 01:07:58.164 --> 01:08:00.045 and for watching these videos. 01:08:00.045 --> 01:08:03.249 I hope that they were informative and that you learned something. 01:08:03.249 --> 01:08:04.591 Thank you, again. 01:08:05.595 --> 01:08:07.151 - We're glad you've taken the time 01:08:07.151 --> 01:08:09.240 to experience these great insights on 01:08:09.240 --> 01:08:11.469 suspension and debarment, and its practice 01:08:11.469 --> 01:08:15.092 in the acquisition process, but the learning isn't done. 01:08:15.092 --> 01:08:16.671 Now it's your turn. 01:08:16.671 --> 01:08:18.668 During our seminar we've been compiling questions 01:08:18.668 --> 01:08:21.593 that you've submitted using the survey link. 01:08:21.593 --> 01:08:24.937 We'll be back in a few moments to answer what we can. 01:08:24.937 --> 01:08:26.911 Stay tuned. 01:08:26.911 --> 01:08:31.596 (upbeat music) 01:08:34.759 --> 01:08:36.709 - [John] For our question and answer session, 01:08:36.709 --> 01:08:39.380 joining us are Maria Swaby and Michael Thompson 01:08:39.380 --> 01:08:42.282 from the U.S. General Services Administration. 01:08:42.282 --> 01:08:43.792 So let's jump into these questions 01:08:43.792 --> 01:08:46.021 we've received from our audience members. 01:08:46.021 --> 01:08:47.530 The first question up, 01:08:47.530 --> 01:08:49.295 what's the role of outside counsel, 01:08:49.295 --> 01:08:51.803 considering that the Suspension and Debarment Official 01:08:51.803 --> 01:08:55.234 specifically did not want to hear from lawyers? 01:08:56.655 --> 01:08:58.025 - [Maria] Thanks John for that question. 01:08:58.025 --> 01:09:00.998 The outside counsel actually plays an important role 01:09:00.998 --> 01:09:02.809 in this process, even though he or she 01:09:02.809 --> 01:09:06.686 does not get to talk that much during the meeting. 01:09:06.686 --> 01:09:09.171 One of the major roles of the outside counsel 01:09:09.171 --> 01:09:12.793 is to prepare and submit the written submission 01:09:12.793 --> 01:09:17.089 that is given in to me a week in advance. 01:09:17.089 --> 01:09:19.852 Their role is to advise their client as to 01:09:19.852 --> 01:09:23.057 what elements the SDO will consider 01:09:23.057 --> 01:09:25.564 to make them presently responsible, 01:09:25.564 --> 01:09:28.165 and to help them through that process. 01:09:28.165 --> 01:09:29.721 For example, in the role play you saw 01:09:29.721 --> 01:09:34.697 that the company employed a new Chief Compliance Officer. 01:09:35.877 --> 01:09:38.757 That is something that the outside counsel 01:09:38.757 --> 01:09:41.149 can help advise the client on how to go about 01:09:41.149 --> 01:09:44.910 employing the proper Chief Compliance Officer. 01:09:44.910 --> 01:09:48.115 The other thing that is not obvious from the meeting, 01:09:48.115 --> 01:09:51.946 but a lot of contractors are very emotional 01:09:51.946 --> 01:09:55.406 about having a meeting with an SDO, 01:09:55.406 --> 01:09:57.821 they tend to be scared or angry when they 01:09:57.821 --> 01:10:02.047 get these notices, and it is the role of the outside counsel 01:10:02.047 --> 01:10:05.321 to calm the client down, kind of get rid of the emotion 01:10:05.321 --> 01:10:08.386 and get them to focus on the business matters 01:10:08.386 --> 01:10:11.381 that are of concern to the Suspension and Debarment Official 01:10:11.381 --> 01:10:14.028 and to properly address those during the meeting. 01:10:14.028 --> 01:10:16.280 The outside counsel also plays the important role 01:10:16.280 --> 01:10:18.811 of actually practicing with the client, 01:10:18.811 --> 01:10:21.319 how to present the information in the meeting 01:10:21.319 --> 01:10:25.081 since they know that the SDO really wants to speak to 01:10:25.081 --> 01:10:29.655 the contractor and not the attorney himself or herself. 01:10:29.655 --> 01:10:32.395 - [John] Okay, so again, more the preparation role 01:10:32.395 --> 01:10:34.090 is what the counsel plays, as opposed to 01:10:34.090 --> 01:10:36.296 an active role during this meeting. 01:10:36.296 --> 01:10:37.480 - [Maria] Correct. 01:10:37.480 --> 01:10:39.640 - [John] Excellent, well, then let's 01:10:39.640 --> 01:10:42.449 take a look at our next question, question number two. 01:10:45.071 --> 01:10:47.974 Continuing to consider the scenario we just saw 01:10:47.974 --> 01:10:50.389 with Clark Industries, why did the sole owner 01:10:50.389 --> 01:10:54.940 allow the other employees to begin running his company? 01:10:54.940 --> 01:10:58.817 And what would happen after the meeting we just saw? 01:10:58.817 --> 01:11:02.718 - [Michael] Thanks, John, for that question as well. 01:11:02.718 --> 01:11:04.739 So in many real world examples, 01:11:04.739 --> 01:11:09.173 if a single employee engages in a wrongdoing, 01:11:09.173 --> 01:11:12.308 then the contractors going to separate itself 01:11:12.308 --> 01:11:14.770 from that wrongdoing employee. 01:11:14.770 --> 01:11:18.299 Of course here in this example, the wrongdoing employee 01:11:18.299 --> 01:11:19.855 was actually the owner of the company, 01:11:19.855 --> 01:11:22.153 which is a unique and more difficult situation, 01:11:22.153 --> 01:11:26.774 but the contractor's owner was in the middle 01:11:26.774 --> 01:11:30.164 of a court case, couldn't effectively run the company, 01:11:30.164 --> 01:11:33.067 was actually already considering selling, 01:11:33.067 --> 01:11:34.437 of course this is all hypothetical, 01:11:34.437 --> 01:11:37.920 but this is based on real world examples that we have seen 01:11:37.920 --> 01:11:40.149 at GSA and other agencies. 01:11:40.149 --> 01:11:42.146 So the owner was embroiled in all these other things 01:11:42.146 --> 01:11:44.143 and kind of gave up control of the company, 01:11:44.143 --> 01:11:47.951 allowed other employees to begin taking over 01:11:47.951 --> 01:11:49.994 the company, so that the company could continue 01:11:49.994 --> 01:11:52.827 its government business, because we can't 01:11:52.827 --> 01:11:55.242 as stewards of taxpayer money, 01:11:55.242 --> 01:11:58.655 we can't allow convicted people who have 01:11:58.655 --> 01:12:01.488 done wrong things to continue to run companies 01:12:01.488 --> 01:12:03.810 that are going to be receiving public funds, 01:12:03.810 --> 01:12:05.343 receiving taxpayer money. 01:12:05.343 --> 01:12:07.190 So that's what the role of 01:12:07.190 --> 01:12:08.480 the Suspension and Debarment Official 01:12:08.480 --> 01:12:10.802 is to look into that, and so in this case 01:12:10.802 --> 01:12:12.637 once that separation happened, 01:12:12.637 --> 01:12:14.285 then Clark Industries is able to 01:12:14.285 --> 01:12:16.630 continue functioning as a government contractor. 01:12:16.630 --> 01:12:18.334 And then you had a follow up question there, 01:12:18.334 --> 01:12:19.617 what would happen next? 01:12:19.617 --> 01:12:20.442 - [John] Yeah. 01:12:20.442 --> 01:12:21.827 - [Michael] Right, so in Clark Industries 01:12:21.827 --> 01:12:24.497 they submitted a written response prior to the meeting, 01:12:24.497 --> 01:12:27.144 in that written response and in the meeting itself 01:12:27.144 --> 01:12:29.490 Clark Industries just was demonstrating 01:12:29.490 --> 01:12:31.649 to the Suspension/Debarment Official 01:12:31.649 --> 01:12:33.368 that it was presently responsible. 01:12:33.368 --> 01:12:36.642 Showing that it accepted responsibility for the actions 01:12:36.642 --> 01:12:39.312 that happened, that it had taken remedial measures, 01:12:39.312 --> 01:12:41.796 i.e. separating itself from the owner, 01:12:41.796 --> 01:12:44.745 and it had taken preventative measures 01:12:44.745 --> 01:12:46.998 to prevent this from happening again in the future. 01:12:46.998 --> 01:12:51.293 They talked about the new Office of Compliance and Ethics, 01:12:51.293 --> 01:12:53.383 the new Compliance and Ethics Officer, 01:12:53.383 --> 01:12:56.935 the extra power given to the now Senior Vice President, 01:12:56.935 --> 01:13:01.277 who is allowed to go around the President and the CEO 01:13:01.277 --> 01:13:04.342 if that person is a new wrongdoer, 01:13:04.342 --> 01:13:05.875 and go straight to the Board of Directors, 01:13:05.875 --> 01:13:07.524 so there's more controls, there's a whole 01:13:07.524 --> 01:13:10.101 ethics and compliance program, more training, 01:13:10.101 --> 01:13:12.482 so basically all of those things demonstrate 01:13:12.482 --> 01:13:13.969 to the Suspension and Debarment Official 01:13:13.969 --> 01:13:15.672 that Clark Industries is presently responsible, 01:13:15.672 --> 01:13:20.473 that they are going to be responsible members of the community, 01:13:21.477 --> 01:13:23.219 not just in relation to what already happened, 01:13:23.219 --> 01:13:25.076 but also going forward. 01:13:25.076 --> 01:13:27.491 - [John] And, granted, this is a mock scenario, 01:13:27.491 --> 01:13:29.767 it's a made up scenario with 01:13:29.767 --> 01:13:31.996 what it is that we're looking at. 01:13:31.996 --> 01:13:33.761 So I was just looking at that question again, 01:13:33.761 --> 01:13:35.920 what would happen after the meeting we just saw? 01:13:35.920 --> 01:13:37.824 I wonder, is that, what would the 01:13:37.824 --> 01:13:39.937 Suspension and Debarment Official do, what decision 01:13:39.937 --> 01:13:42.352 would he or she make in that scenario? 01:13:42.352 --> 01:13:44.094 Because you've already said, the company has 01:13:44.094 --> 01:13:45.858 done an awful lot to, as you said, 01:13:45.858 --> 01:13:48.203 make themselves presently responsible. 01:13:48.203 --> 01:13:49.945 - [Michael] Yeah, so likely this 01:13:49.945 --> 01:13:53.614 Suspension and Debarment Official can terminate review 01:13:53.614 --> 01:13:56.516 of the company, and in that case to formally 01:13:56.516 --> 01:13:59.117 terminate the review, the Suspension/Debarment Official 01:13:59.117 --> 01:14:03.616 would send a letter to the contractor in that case. 01:14:06.036 --> 01:14:08.614 - [Maria] And let me just add, as you saw in this scenario, 01:14:08.614 --> 01:14:10.402 at the end of the meeting the 01:14:10.402 --> 01:14:13.002 Suspension and Debarment Official made it clear 01:14:13.002 --> 01:14:16.230 that the information presented during the meeting 01:14:16.230 --> 01:14:20.619 and as a result of the submission gave her 01:14:20.619 --> 01:14:23.312 enough comfort that they were presently responsible 01:14:23.312 --> 01:14:25.843 and she had decided then, not to take any action, 01:14:25.843 --> 01:14:29.140 and then she also told them that they would get 01:14:29.140 --> 01:14:33.088 a letter from her stating that the review was closed. 01:14:33.088 --> 01:14:34.992 So that's generally the next step. 01:14:34.992 --> 01:14:37.221 After the review is closed, the case is over, 01:14:37.221 --> 01:14:39.334 unless some new evidence comes in 01:14:39.334 --> 01:14:41.470 there's nothing else that's going to be done 01:14:41.470 --> 01:14:43.513 at that point with that company 01:14:43.513 --> 01:14:45.348 in terms of suspension and debarment. 01:14:45.348 --> 01:14:46.671 - [John] Okay, that sounds good. 01:14:46.671 --> 01:14:48.459 Let's move on the to our next question. 01:14:48.459 --> 01:14:51.130 Do all contractors who meet with 01:14:51.130 --> 01:14:54.520 a Suspension and Debarment Official avoid exclusion? 01:14:54.520 --> 01:14:55.727 - [Maria] No. 01:14:57.227 --> 01:15:00.069 Suspension and Debarment is a case by case 01:15:00.069 --> 01:15:03.227 determination by the SDO. 01:15:03.227 --> 01:15:06.029 It's discretionary, and it's also based on 01:15:06.029 --> 01:15:08.475 the facts and the circumstances that 01:15:08.475 --> 01:15:10.681 are before the SDO to consider. 01:15:10.681 --> 01:15:14.489 So it is possible that a company, 01:15:14.489 --> 01:15:16.416 even when they meet with the 01:15:16.416 --> 01:15:17.809 Suspension and Debarment Official, 01:15:17.809 --> 01:15:19.876 or an individual, if they're not presently responsible, 01:15:19.876 --> 01:15:23.289 if the SDO can not deem that company or contractor 01:15:23.289 --> 01:15:26.424 presently responsible regardless of the meeting 01:15:26.424 --> 01:15:29.094 then that contractor or individual would be 01:15:29.094 --> 01:15:31.532 suspended or debarred. 01:15:31.532 --> 01:15:33.367 - [John] Okay great, next question. 01:15:33.367 --> 01:15:35.689 Maybe a little bit more basic, I think it'll 01:15:35.689 --> 01:15:37.360 certainly help me out. 01:15:37.360 --> 01:15:40.751 What is the difference between suspension and debarment? 01:15:42.391 --> 01:15:43.769 - [Michael] So that's a good question. 01:15:43.769 --> 01:15:45.255 Obviously suspension and debarment, 01:15:45.255 --> 01:15:48.204 we use that as the name of the entire process, 01:15:48.204 --> 01:15:51.203 the whole system, we call it Suspension and Debarment. 01:15:51.203 --> 01:15:52.686 But suspension and debarment are actually 01:15:52.686 --> 01:15:55.008 two actions that can be taken by 01:15:55.008 --> 01:15:56.796 the Suspension and Debarment Official. 01:15:56.796 --> 01:15:58.491 The first one, suspension, is usually- 01:15:58.491 --> 01:16:01.045 is a temporary measure, usually taken 01:16:01.045 --> 01:16:03.692 in conjunction with a court proceeding 01:16:03.692 --> 01:16:08.447 or an investigation by a criminal investigative body, 01:16:09.805 --> 01:16:11.593 the Office of the Inspector General, 01:16:11.593 --> 01:16:13.381 something like that, or even an investigation by 01:16:13.381 --> 01:16:15.563 a Suspension and Debarment Official's office, 01:16:15.563 --> 01:16:18.396 should that office engage in an investigation. 01:16:18.396 --> 01:16:20.741 So it's a temporary measure, and the evidentiary 01:16:20.741 --> 01:16:23.574 standard is lower than with a debarment. 01:16:23.574 --> 01:16:26.291 Evidentiary standard is called, in the regulations, 01:16:26.291 --> 01:16:28.520 adequate evidence, and this is very similar 01:16:28.520 --> 01:16:31.144 to the probable cause evidentiary standard 01:16:31.144 --> 01:16:33.350 we're all familiar with from watching Law & Order, 01:16:33.350 --> 01:16:37.646 basically is it more probably than not that- 01:16:37.646 --> 01:16:41.105 no I'm sorry, is it reasonably probable 01:16:41.105 --> 01:16:43.358 that this could have happened. 01:16:43.358 --> 01:16:45.656 So it's a lower evidentiary standard, 01:16:45.656 --> 01:16:48.396 and again it's temporary, it can't last more than a year 01:16:48.396 --> 01:16:51.717 with a few exceptions, and it's usually in conjunction 01:16:51.717 --> 01:16:54.225 with a court proceeding. 01:16:54.225 --> 01:16:56.338 And a great example of something that would 01:16:56.338 --> 01:16:58.056 meet that standard would be a criminal indictment 01:16:58.056 --> 01:17:00.703 or criminal information that's the courts- 01:17:00.703 --> 01:17:05.695 that persay meets our evidentiary standard for suspension. 01:17:05.695 --> 01:17:09.503 Debarments are a longer term, final action, 01:17:09.503 --> 01:17:13.358 and it's used when basically the court proceeding is over, 01:17:13.358 --> 01:17:17.027 or all the facts in the record have been completed. 01:17:17.027 --> 01:17:18.931 The evidentiary standard there is called preponderance 01:17:18.931 --> 01:17:21.810 of the evidence, and that is the 50% plus. 01:17:21.810 --> 01:17:24.225 This is the same as a civil court evidentiary standard, 01:17:24.225 --> 01:17:26.802 and that's the more probable than not standard. 01:17:26.802 --> 01:17:30.308 So if it's more probable that it happened than it didn't, 01:17:30.308 --> 01:17:32.282 then that meets the standard of preponderance of evidence. 01:17:32.282 --> 01:17:37.108 By rule, any criminal or civil judgement meets that standard 01:17:39.321 --> 01:17:44.321 from a court, so we can use that information 01:17:44.359 --> 01:17:47.680 to then take the debarment and those facts are then set 01:17:47.680 --> 01:17:49.757 because they're set by the court. 01:17:49.757 --> 01:17:51.708 The debarments usually last three years, 01:17:51.708 --> 01:17:53.821 they can last shorter or longer depending on 01:17:53.821 --> 01:17:56.282 mitigating or aggregating factors, 01:17:56.282 --> 01:17:57.606 and that's up to the discretion 01:17:57.606 --> 01:18:00.207 of each Suspension and Debarment Official each time. 01:18:00.207 --> 01:18:02.621 But, again, so basically suspension is temporary, 01:18:02.621 --> 01:18:05.152 about a year, debarments are a final action 01:18:05.152 --> 01:18:06.755 and they're usually three years, 01:18:06.755 --> 01:18:08.728 and they have a higher evidentiary standard. 01:18:08.728 --> 01:18:10.539 - [John] Okay, and you touched on this in your answer 01:18:10.539 --> 01:18:13.813 a bit before, I didn't ask it here but now I do. 01:18:13.813 --> 01:18:16.042 Do reports from Inspectors General 01:18:16.042 --> 01:18:18.930 generally support suspension or debarment? 01:18:18.930 --> 01:18:20.361 - [Michael] Right, so our referral from 01:18:20.361 --> 01:18:22.405 the Inspector General's office or from 01:18:22.405 --> 01:18:25.592 the acquisition workforce, or information 01:18:25.592 --> 01:18:28.581 gathered from the media, or anywhere. 01:18:28.581 --> 01:18:30.532 Any referral that goes to Suspension and Debarment Official 01:18:30.532 --> 01:18:33.016 can support either suspension or debarment 01:18:33.016 --> 01:18:34.688 or one of the non-exclusionary actions 01:18:34.688 --> 01:18:36.848 the Suspension and Debarment Official can take. 01:18:36.848 --> 01:18:39.564 It all depends on what evidentiary standard is met. 01:18:39.564 --> 01:18:42.560 If the referral from the Inspector General 01:18:42.560 --> 01:18:44.998 includes an indictment and nothing more 01:18:44.998 --> 01:18:47.761 then that would satisfy suspension. 01:18:47.761 --> 01:18:50.733 If there's no court case at all, then it becomes 01:18:50.733 --> 01:18:52.753 a question of how many facts are here? 01:18:52.753 --> 01:18:55.377 Is this more probable than not, or is it just 01:18:55.377 --> 01:18:57.699 probably true under the adequate evidence standard, 01:18:57.699 --> 01:18:59.650 so would it be preponderance of the evidence 01:18:59.650 --> 01:19:01.948 or adequate evidence, debarment or suspension? 01:19:01.948 --> 01:19:05.478 If it's a criminal conviction forwarded to us 01:19:05.478 --> 01:19:07.428 by a Contracting Officer, that would 01:19:07.428 --> 01:19:09.100 meet the preponderance of the evidence standard 01:19:09.100 --> 01:19:10.656 and that would support a debarment. 01:19:10.656 --> 01:19:12.351 So it just depends on what evidence is included 01:19:12.351 --> 01:19:14.278 in whatever report we get from 01:19:14.278 --> 01:19:17.181 whatever entity submits that referral. 01:19:17.181 --> 01:19:18.411 - [John] Great, great. 01:19:18.411 --> 01:19:21.267 Now getting to the next question, more on I suppose, 01:19:21.267 --> 01:19:23.938 the process of suspension and debarment. 01:19:23.938 --> 01:19:26.538 According to the Federal Acquisition Regulation, or FAR, 01:19:26.538 --> 01:19:29.162 notices from Suspension and Debarment Officials 01:19:29.162 --> 01:19:31.229 must be sent by Certified Mail. 01:19:31.229 --> 01:19:34.294 What happens if the notice is returned "refused"? 01:19:35.514 --> 01:19:38.659 - [Maria] Okay, so if the notice is returned refused 01:19:38.659 --> 01:19:40.981 for Suspension and Debarment purposes 01:19:40.981 --> 01:19:44.580 that is deemed as adequate notice having been served. 01:19:44.580 --> 01:19:47.599 The fact that the contractor or individual chooses 01:19:47.599 --> 01:19:50.501 to ignore the notice, or not pick up the notice, 01:19:50.501 --> 01:19:53.775 or give back the notice does not negate the fact 01:19:53.775 --> 01:19:58.775 that notice was given, so refused means notice given. 01:20:00.021 --> 01:20:01.717 - [John] Easy enough, straight forward. 01:20:01.717 --> 01:20:03.087 Don't refuse those notices. 01:20:03.087 --> 01:20:04.410 (laughter) 01:20:04.410 --> 01:20:06.853 Is there anything a contractor could do that would 01:20:06.853 --> 01:20:09.361 require the Suspension and Debarment Official 01:20:09.361 --> 01:20:11.747 to suspend or debar the contractor? 01:20:13.099 --> 01:20:14.794 - [Michael] So that's a good question. 01:20:14.794 --> 01:20:18.626 We operate here at GSA under FAR 9.4, 01:20:18.626 --> 01:20:20.924 Federal Acquisition Regulation 9.4 01:20:20.924 --> 01:20:22.782 and there's a bunch of causes listed there, 01:20:22.782 --> 01:20:24.941 but they're all considered discretionary debarment. 01:20:24.941 --> 01:20:26.822 So you heard Maria use that term earlier, 01:20:26.822 --> 01:20:28.564 what that means is the Suspension and Debarment Official 01:20:28.564 --> 01:20:30.723 gets to choose whether or not to take that action, 01:20:30.723 --> 01:20:32.836 and that's going to be based on facts, not a whim. 01:20:32.836 --> 01:20:35.367 But based on the facts of the case, is it necessary 01:20:35.367 --> 01:20:37.109 to protect the governments interests 01:20:37.109 --> 01:20:40.656 by suspending or debarring this specific contractor? 01:20:41.869 --> 01:20:43.401 So that's a discretionary debarment, 01:20:43.401 --> 01:20:44.911 and the same is true under what's called 01:20:44.911 --> 01:20:46.582 the Non-procurement Common Rule 01:20:46.582 --> 01:20:49.856 which is used for grants and other sorts 01:20:49.856 --> 01:20:53.664 of federal awards, people, companies, entities 01:20:53.664 --> 01:20:56.196 that receive those types of awards 01:20:56.196 --> 01:20:58.425 can also be suspended or debarred, again, 01:20:58.425 --> 01:21:00.027 based on a bunch of causes. 01:21:00.027 --> 01:21:02.047 Again, that's discretionary. 01:21:02.047 --> 01:21:05.112 So under those two regimes, no there is nothing 01:21:05.112 --> 01:21:07.179 that would require the Suspension and Debarment Official 01:21:07.179 --> 01:21:08.827 to suspend or debar the contractor, 01:21:08.827 --> 01:21:10.569 it's always a question of, what are the facts? 01:21:10.569 --> 01:21:13.169 What does the government's interest require? 01:21:13.169 --> 01:21:15.700 However, there are some statutory causes 01:21:15.700 --> 01:21:18.092 for debarment that do require a suspension or 01:21:18.092 --> 01:21:19.857 debarment action to be taken. 01:21:19.857 --> 01:21:22.063 Those include violations of certain environmental laws 01:21:22.063 --> 01:21:25.453 like the Clean Air Act, the Clean Water Act, 01:21:25.453 --> 01:21:28.053 as well as certain types of Medicare and Medicaid fraud, 01:21:28.053 --> 01:21:30.236 and there are some others as well 01:21:30.236 --> 01:21:33.278 including some tax convictions related to 01:21:33.278 --> 01:21:35.623 Department of Defense contractors, 01:21:35.623 --> 01:21:38.084 and various other ones, so there are some statutory 01:21:38.084 --> 01:21:41.242 ones that require, if this conduct happens, 01:21:41.242 --> 01:21:44.284 then this contractor will be debarred. 01:21:44.284 --> 01:21:46.420 However, that's not the most. 01:21:46.420 --> 01:21:48.231 The loin's share of the debarments 01:21:48.231 --> 01:21:49.950 that you hear about are the ones that are done 01:21:49.950 --> 01:21:53.502 under FAR 9.4 or the Non-procurement Common Rule. 01:21:53.502 --> 01:21:55.290 And those are ones that are all discretionary, 01:21:55.290 --> 01:21:57.602 and it's all based on the facts. 01:21:57.602 --> 01:21:59.470 - [Maria] And let me just add a point of clarification. 01:21:59.470 --> 01:22:03.185 Although, the vast majority of suspension and debarments 01:22:03.185 --> 01:22:06.622 we do here are the discretionary ones, 01:22:06.622 --> 01:22:10.383 but the vast majority of exclusions or suspensions 01:22:10.383 --> 01:22:13.750 are actually the required statutory ones. 01:22:13.750 --> 01:22:15.213 Just to be clear of that. 01:22:15.213 --> 01:22:16.583 - [Michael] Yeah, a lot happens under 01:22:16.583 --> 01:22:18.487 Medicare and Medicaid fraud, there are lots of people 01:22:18.487 --> 01:22:20.368 that do that, and those are individual doctors 01:22:20.368 --> 01:22:22.713 or individual medical clinics, 01:22:22.713 --> 01:22:24.873 and a lot of those happen really quick. 01:22:24.873 --> 01:22:26.985 They're very easy because there's no question, 01:22:26.985 --> 01:22:28.518 they just happen, and you're right 01:22:28.518 --> 01:22:30.259 the vast majority of ones that are taken are those, 01:22:30.259 --> 01:22:32.187 but those are the ones that are simple and easy, 01:22:32.187 --> 01:22:34.393 and there's not much to argue because the statues require- 01:22:34.393 --> 01:22:36.599 it's out of the hands of the Suspension and Debarment 01:22:36.599 --> 01:22:38.526 Official at that point. 01:22:38.526 --> 01:22:39.594 - [John] Very good. 01:22:39.594 --> 01:22:40.917 The next question has to do with 01:22:40.917 --> 01:22:43.425 actually one of the resources that we've posted 01:22:43.425 --> 01:22:45.863 with today's presentations and that is, 01:22:45.863 --> 01:22:48.928 the best practices for meeting with an SDO 01:22:48.928 --> 01:22:51.459 or Suspension and Debarment Official. 01:22:51.459 --> 01:22:53.712 It states that the contractor should never engage 01:22:53.712 --> 01:22:57.195 in re-litigating a case before an SDO. 01:22:57.195 --> 01:22:58.774 What does that mean? 01:22:58.774 --> 01:22:59.888 - [Maria] Great question. 01:22:59.888 --> 01:23:01.281 Let me just give you some context 01:23:01.281 --> 01:23:02.651 before I answer that question. 01:23:02.651 --> 01:23:06.041 In those cases, most we're referring to 01:23:06.041 --> 01:23:10.453 suspension or debarment actions based on 01:23:10.453 --> 01:23:12.938 for example, a criminal conviction. 01:23:12.938 --> 01:23:14.865 So if there's been a criminal conviction, 01:23:14.865 --> 01:23:17.373 there has been a court case where you have 01:23:17.373 --> 01:23:20.298 argued and defended your case and litigated your case, 01:23:20.298 --> 01:23:23.874 and you've argued what the facts are. 01:23:23.874 --> 01:23:25.964 A court of law has determined that, 01:23:25.964 --> 01:23:28.960 based on whatever it is that was presented 01:23:28.960 --> 01:23:32.298 that this contractor is guilty of a crime. 01:23:33.209 --> 01:23:35.182 And so that's a fact, that's determined, 01:23:35.182 --> 01:23:37.272 that's an open and shut case. 01:23:37.272 --> 01:23:40.198 When you come before the Suspension and Debarment Official 01:23:40.198 --> 01:23:42.613 the Suspension and Debarment Official is not interested 01:23:42.613 --> 01:23:46.189 in you going over the same material 01:23:46.189 --> 01:23:50.670 you went over in court to prove your innocence or guilt. 01:23:50.670 --> 01:23:52.389 That's already been established. 01:23:52.389 --> 01:23:54.827 What the Suspension and Debarment Official 01:23:54.827 --> 01:23:57.729 is interested in is having a conversation 01:23:57.729 --> 01:24:02.629 about what it is that he or she's concerned about 01:24:03.563 --> 01:24:06.674 in terms of protecting the government's interests. 01:24:06.674 --> 01:24:10.761 So it's not meant to be a litigious or unpleasant 01:24:10.761 --> 01:24:15.266 meeting, or it's not meant to be contentious at all. 01:24:15.266 --> 01:24:19.817 It's meant to put aside whatever emotions there are 01:24:19.817 --> 01:24:22.324 and to actually deal with the business aspects 01:24:22.324 --> 01:24:25.227 of the case and the concerns of the SDO. 01:24:25.227 --> 01:24:30.057 And that's why the SDO focuses on the present going forward, 01:24:30.057 --> 01:24:34.166 and acknowledges the past, but doesn't spend time 01:24:34.166 --> 01:24:36.488 in the meeting going over that, because that is not 01:24:36.488 --> 01:24:40.273 the point of her meeting with the contractor. 01:24:40.273 --> 01:24:42.386 - [Michael] You know Maria, I've heard you explain before 01:24:42.386 --> 01:24:46.404 that a bad act is an indicator that a bad act occurred 01:24:46.404 --> 01:24:48.331 and could happen in the future, 01:24:48.331 --> 01:24:50.746 and then your job is just to see, to make sure that 01:24:50.746 --> 01:24:54.252 there are sufficient controls in place now 01:24:54.252 --> 01:24:56.729 to prevent that bad act from reoccurring. 01:24:56.729 --> 01:24:57.549 - [Maria] Right. 01:24:57.549 --> 01:24:58.873 - [Michael] So you're focused on today 01:24:58.873 --> 01:25:00.498 and tomorrow, not yesterday. 01:25:00.498 --> 01:25:02.356 - [Maria] Right, correct. 01:25:02.356 --> 01:25:03.981 - [John] Now looking at, say, an entire 01:25:03.981 --> 01:25:05.815 Suspension and Debarment Office 01:25:05.815 --> 01:25:07.859 and what it has to deal with throughout the year, 01:25:07.859 --> 01:25:10.808 what percentage of contractors who are referred 01:25:10.808 --> 01:25:12.898 to the Suspension and Debarment Official 01:25:12.898 --> 01:25:16.938 end up being suspended or debarred in a typical year? 01:25:16.938 --> 01:25:18.517 - [Michael] Well John, that's a hard question. 01:25:18.517 --> 01:25:21.233 That varies widely in each year and at each agency 01:25:21.233 --> 01:25:24.763 because each decision by a Suspension and Debarment Official 01:25:24.763 --> 01:25:27.596 is unique, it's based on that specific contractor 01:25:27.596 --> 01:25:30.748 and the specific facts, so the percentage varies 01:25:30.748 --> 01:25:32.867 based on the nature of the cases referred 01:25:32.867 --> 01:25:34.864 to each agency's Suspension and Debarment Official 01:25:34.864 --> 01:25:36.326 each and every year. 01:25:36.326 --> 01:25:38.857 Speaking for my agency, the General Services Administration 01:25:38.857 --> 01:25:43.362 only, the vast amount of cases referred to Maria, 01:25:43.362 --> 01:25:45.847 our Suspension and Debarment Official, for consideration 01:25:45.847 --> 01:25:48.345 result in some action by Maria. 01:25:48.345 --> 01:25:51.689 Whether that action is an exclusion, a suspension or debarment, 01:25:51.689 --> 01:25:53.756 or a non-exclusionary action such as 01:25:53.756 --> 01:25:55.590 a show cause letter and/or a meeting. 01:25:55.590 --> 01:25:58.090 A good example of a referral that resulted 01:25:58.090 --> 01:26:00.513 in a non-exclusion action is the mock meeting we just saw 01:26:00.513 --> 01:26:02.115 with Clark Industries. 01:26:02.115 --> 01:26:04.506 Their Suspension and Debarment Official, Maria 01:26:04.506 --> 01:26:07.246 in her role as the mock Suspension and Debarment Official 01:26:07.246 --> 01:26:10.451 sent Clark Industries a show cause letter, 01:26:10.451 --> 01:26:12.262 Clark Industries came in and showed 01:26:12.262 --> 01:26:15.722 that it was presently responsible, no exclusion resulted. 01:26:15.722 --> 01:26:18.160 However, the Suspension and Debarment Official 01:26:18.160 --> 01:26:20.366 did take action, and those actions resulted 01:26:20.366 --> 01:26:23.361 in Clark Industries, in this hypothetical scenario, 01:26:23.361 --> 01:26:26.519 realizing how seriously this type of misconduct 01:26:26.519 --> 01:26:28.818 is taken by the Federal Government 01:26:28.818 --> 01:26:30.623 and becoming a better contractor, 01:26:30.623 --> 01:26:33.833 putting in a lot of those controls that it needed all along, 01:26:33.833 --> 01:26:36.109 but just didn't know, and moving forward 01:26:36.109 --> 01:26:39.336 as a better member of the procurement community. 01:26:39.336 --> 01:26:41.333 - [John] Right, because I guess you might say, 01:26:41.333 --> 01:26:42.610 you're not grading on a curve, 01:26:42.610 --> 01:26:44.654 there aren't a certain set of contractors you want 01:26:44.654 --> 01:26:47.626 to suspend, debar, exclude from competing. 01:26:47.626 --> 01:26:50.459 You want them all to be able to participate. 01:26:50.459 --> 01:26:52.479 - [Michael] Yeah, if we suspend or debar 01:26:52.479 --> 01:26:55.149 every contractor then we can't procure anything, 01:26:55.149 --> 01:26:56.682 so Suspension and Debarment Official 01:26:56.682 --> 01:26:59.422 always has to- always is looking to make people 01:26:59.422 --> 01:27:01.813 as presently responsible, if they are, 01:27:01.813 --> 01:27:03.532 find them presently responsible, help them 01:27:03.532 --> 01:27:04.739 become presently responsible. 01:27:04.739 --> 01:27:06.596 And only in the cases where it's necessary to 01:27:06.596 --> 01:27:08.872 protect the government's interests, exclude them 01:27:08.872 --> 01:27:11.101 from further business with the Federal Government. 01:27:11.101 --> 01:27:12.193 - [John] Very good. 01:27:12.193 --> 01:27:14.027 Well unfortunately, we need to stop there 01:27:14.027 --> 01:27:16.001 because that's all the time that we have for today. 01:27:16.001 --> 01:27:17.928 But I'd like to thank you, our viewers, 01:27:17.928 --> 01:27:19.809 for the fantastic follow-up questions 01:27:19.809 --> 01:27:21.272 and certainly our speakers, 01:27:21.272 --> 01:27:23.849 Maria Swaby and Michael Thompson. 01:27:23.849 --> 01:27:24.731 - [Maria] Thank you. 01:27:24.731 --> 01:27:26.496 - [Michael] Thank you, John. 01:27:26.496 --> 01:27:31.496 (upbeat music) 01:27:31.581 --> 01:27:33.717 - As always, we hope you found today's seminar 01:27:33.717 --> 01:27:36.156 very educational and useful in de-mistifying 01:27:36.156 --> 01:27:38.385 Suspension and Debarment. 01:27:38.385 --> 01:27:40.590 And now we'd also like to extend a hand 01:27:40.590 --> 01:27:42.959 to our colleagues in industry to share advice 01:27:42.959 --> 01:27:45.885 on meeting with a Suspension and Debarment Official 01:27:45.885 --> 01:27:49.205 should you ever find yourself in that position. 01:27:49.205 --> 01:27:51.086 If you're a contractor meeting with 01:27:51.086 --> 01:27:52.758 a Suspension and Debarment Official, 01:27:52.758 --> 01:27:56.218 keep in mind that the meeting is for three things. 01:27:56.218 --> 01:27:59.074 It's for you to present matters in opposition 01:27:59.074 --> 01:28:03.184 to an exclusionary action, provide information requested, 01:28:03.184 --> 01:28:06.365 and disclose misconduct or violations 01:28:06.365 --> 01:28:10.057 and what you and your company are doing to correct them. 01:28:10.057 --> 01:28:12.216 One final bit of advice, is that you should 01:28:12.216 --> 01:28:15.281 never try to engage in re-litigating a case 01:28:15.281 --> 01:28:18.068 before a Suspension and Debarment Official. 01:28:18.068 --> 01:28:20.599 That decision has already been made. 01:28:20.599 --> 01:28:22.789 What's important now is understanding 01:28:22.789 --> 01:28:25.452 how and why that decision came about, 01:28:25.452 --> 01:28:27.634 and what you and your company can do 01:28:27.634 --> 01:28:29.863 to properly respond. 01:28:29.863 --> 01:28:32.603 Once again, the Federal Acquisition Institute 01:28:32.603 --> 01:28:35.895 thanks you for your time and your attention.