Special Inspector General for 

Afghanistan Reconstruction

SIGAR Audit 13-6

CONTRACTING WITH THE ENEMY: DOD 

Has Limited Assurance that Contractors 

with Links to Enemy Groups Are Identified 

and their Contracts Terminated

SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA

SIGAR

APRIL

2013
For more information, contact SIGAR Public Affairs at (703) 545-5974 or sigar.pentagon.ccr.mbx.public-affairs@mail.mil.

WHAT SIGAR REVIEWED 

To reduce the risk of inadvertently 

contracting with individuals or entities 

that provide funds to groups that oppose 

U.S. and coalition forces, Congress 

included Section 841 in the fiscal year 

2012 National Defense Authorization Act 

(NDAA). Section 841 permits the 

Department of Defense (DOD) to 

authorize a Head of a Contracting Activity 

(HCA) to restrict, terminate, or void a DOD 

contract, grant, or cooperative agreement 

with an entity or individual determined to 

be actively supporting an insurgency or 

otherwise opposing U.S. or coalition 

forces in the Central Command 

(CENTCOM) theater of operations, 

including Afghanistan. As of January 18, 

2013, CENTCOM had issued four 

notification letters identifying five 

companies and their associates as 

Section 841 designees.

This report describes the processes DOD 

has established to implement Section 

841, assesses the extent to which DOD’s 

process for implementing Section 841 

has aided in identifying and preventing 

U.S. contracting funds from being 

provided to individuals and entities 

identified as actively supporting an 

insurgency or opposing U.S. or coalition 

forces in Afghanistan, and lists some 

areas of the Section 841 legislation that 

could be strengthened to prevent 

contracting with the enemy.

SIGAR conducted this work in 

Washington, D.C.; Tampa, Florida; San 

Antonio, Texas; and three provinces in 

Afghanistan from August 2012 to April

2013 in accordance with generally 

accepted government auditing standards.

WHAT SIGAR FOUND 

DOD has established a two-phase process to comply with Section 841. The

first phase of the process involves targeting, reviewing, and designating a 

Section 841 person or entity, and, ultimately, notifying the Head of the

Contracting Activity (HCA) of this designation. U.S. Forces–Afghanistan’s

Task Force 2010 (TF2010) currently administers the intelligence portion 

established by Section 841. Once a target has been identified, TF2010 

assembles an information package on the target and conducts preliminary

intelligence and legal analyses. The Section 841 information package is 

routed through a series of coordinating agencies of the International

Security Assistance Force Joint Command for review and concurrence before

it goes to CENTCOM for a final decision. Upon approval, the CENTCOM

Commander prepares a Section 841 notification listing the entities

identified, along with a request that the HCAs exercise the authority

provided in Section 841 to restrict, terminate, or void contracts with those

listed. CENTCOM then distributes the notification to the HCAs. In the

second phase, the HCAs determine if they have any contracts with the

person or entity listed in the CENTCOM notification. The process concludes

when the HCA responds to CENTCOM with the actions taken on the

contracts.

SIGAR identified several weaknesses in DOD’s process for implementing 

Section 841 that prevent the department from having reasonable 

assurance that U.S. government contracting funds are not being provided to 

persons and entities supporting the insurgency and opposing U.S. and 

coalition forces. As a result, millions of contracting dollars could be diverted 

to forces seeking to harm U.S. military and civilian personnel in Afghanistan 

and derail the multi-billion dollar reconstruction effort.

Specifically, SIGAR found:

• Some contracts did not (1) contain the required language clause 

prohibiting contractors from entering into subcontracts with Section 

841 designees or (2) notify contractors of HCAs’ authorities. The 

agency’s failure to include the clause in contracts may prevent 

contractors from knowing their legal requirement to avoid 

contracting with Section 841 designees and understanding the 

HCAs’ authorities to restrict, terminate, or void their contracts if 

they fail to meet their legal obligations.

• Some HCAs did not receive CENTCOM’s notification identifying 

supporters of enemy groups, which may make it difficult for HCAs 

to take necessary actions on any contracts issued to Section 841 

designees.

SIGAR

Special Inspector General for 

Afghanistan Reconstruction

APRIL 2013

CONTRACTING WITH THE ENEMY: DOD Has Limited Assurance that 

Contractors with Links to Enemy Groups Are Identified and their Contracts 

Terminated

SIGAR AUDIT 13-6
For more information, contact SIGAR Public Affairs at (703) 545-5974 or sigar.pentagon.ccr.mbx.public-affairs@mail.mil.

WHAT SIGAR RECOMMENDS 

SIGAR is making seven 

recommendations to the Director of the 

Office of Defense Procurement and 

Acquisition Policy (DPAP): five 

recommendations to improve visibility 

over active contracts in Afghanistan; 

one to formally determine, in 

coordination with the Commander of 

CENTCOM, which entity will be 

responsible for centrally tracking data 

on Section 841 actions, thus preventing

duplication of effort; and one to ensure

that HCAs have the information needed

to respond to legal challenges and

address any financial liabilities that

may result from exercising their Section

841 authorities. DPAP provided 

informal comments that generally 

supported our recommendations for 

improving the process for notifying the 

DOD acquisition community and 

contractors of Section 841 designees. 

However, formal comments will be 

provided after the release of the final 

report.

MATTERS FOR CONGRESSIONAL 

CONSIDERATION 

SIGAR is also including matters for 

congressional consideration. To ensure 

all contracts in Afghanistan are subject 

to Section 841, Congress may wish to 

consider eliminating the $100,000 

threshold value for contracts. To 

provide DOD with greater clarity on the 

future of designations and efforts made 

under Section 841, Congress may wish 

to provide guidance on the status of the 

designations once the legislation 

expires on December 31, 2014. Lastly, 

if the intent is for Section 841 

designations to expire with the 

legislation, Congress may wish to 

consider requiring contracting agencies 

to preserve information and intelligence 

gathered through the Section 841 

process.

• HCAs have not consistently informed their prime contractors

of Section 841 designations, even though the most recent 

Section 841 notification requests that they do so. 

Furthermore, DOD has not developed a formal policy for all 

HCAs to notify prime contractors of Section 841 

designations, leaving it to the individual HCAs to develop 

their own. In the absence of a formal policy, HCAs and prime 

contractors may continue to contract with and award future 

contracts to Section 841 designees in violation of the law.

• CENTCOM began posting Section 841 designations on its 

public website in January 2013; however, contracting officers 

and prime contractors are not required to regularly review the 

information.

• Because HCAs do not have full visibility over most 

subcontracts, they must rely on their prime contractors to 

identify subcontracts with Section 841 designees and take 

necessary steps to terminate, restrict, or void them. Currently, 

prime contractors are not required to formally certify that they 

do not hold any subcontracts with Section 841 designees. As 

a result, HCAs have little assurance that they are identifying 

all contracts with Section 841 designees.

• HCAs and prime contractors are at risk of legal challenges 

from Section 841 designees because DOD has not provided 

guidance addressing the consequences of and actions to 

take after exercising Section 841 authorities. Contracting 

officials also lack guidance for absorbing the financial costs, 

such as seeking a new contractor, associated with restricting, 

terminating, or voiding a contract with a Section 841 

designee. Without such guidance, HCAs and prime 

contractors may not be able to formulate an appropriate 

response to current and future legal challenges.

• DOD does not centrally track actions taken pursuant to 

Section 841 authorities. Section 841 requires the Secretary 

of Defense to report annually to Congress in 2013, 2014, and 

2015 on the use of authorities during the preceding year. 

Currently, both DPAP and CENTCOM are collecting this data, 

resulting in a duplication of effort.

Finally, SIGAR found areas where Section 841 could be 

strengthened. For instance, Section 841 only applies to contracts 

valued in excess of $100,000, although approximately 80 percent 

of contracts awarded in Afghanistan fall below the $100,000 

threshold. In addition, Section 841 will expire on December 31, 

2014, putting in question the status of designations made under 

the section and relevant clauses included in contracts issued 

prior to this date.

SIGAR is addressing Department of State and U.S. Agency for 

International Development efforts to prevent contracting with the 

enemy in a separate review.
April 11, 2013

The Honorable Charles T. Hagel

Secretary of Defense

Mr. Richard T. Ginman

Director, Defense Procurement and Acquisition Policy

Department of Defense

General Lloyd J. Austin III

Commander, U.S. Central Command

General Joseph F. Dunford, Jr.

Commander, U.S. Forces–Afghanistan, and

Commander, International Security Assistance Force

The Honorable James Cunningham

U.S. Ambassador to Afghanistan

This report discusses the results of SIGAR’s audit of the Department of Defense’s (DOD) 

compliance with Section 841—Prohibition on Contracting with the Enemy in the United States 

Central Command (CENTCOM) Theater of Operations—of the Fiscal Year 2012 National 

Defense Authorization Act. This report includes seven recommendations to DOD’s Office of 

Defense Procurement and Acquisition Policy to improve visibility over contracts, particularly 

subcontracts, in Afghanistan. The recommendations are designed to ensure that DOD has a 

central mechanism for tracking data on actions taken in response to Section 841 and that 

contracting agencies have the guidance needed to respond to legal challenges and address 

financial liabilities that result after they have exercised their Section 841 authorities.

When preparing the final report, we considered technical comments from CENTCOM, the U.S. 

Army Corps of Engineers, and the Air Force Civil Engineering Center. DOD’s Office of Defense 

Procurement and Acquisition Policy also provided informal comments that generally supported 

our recommendations. However, Defense Procurement and Acquisition Policy officials stated 

that formal comments will be provided after the release of the final report. SIGAR conducted 

this performance audit under the authority of Public Law No. 110-181, as amended; the 

Inspector General Act of 1978; and the Inspector General Reform Act of 2008.

John F. Sopko

Special Inspector General

for Afghanistan Reconstruction
TABLE OF CONTENTS

SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page i

Background.................................................................................................................................................................. 3

DOD Has Established a Two-phase Process to Comply with Section 841.............................................................. 4

Weaknesses Exist in DOD’s Section 841 Process.................................................................................................... 5

Section 841 Legislation Needs to Be Strengthened ................................................................................................ 7

Conclusion ................................................................................................................................................................... 8

Recommendations ...................................................................................................................................................... 8

Matters for Congressional Consideration................................................................................................................... 9

Agency Comments ....................................................................................................................................................... 9

Appendix I - Scope and Methodology .......................................................................................................................10

Appendix II - Department of Defense Section 841 Implementation Process ........................................................12

Appendix III - Acknowledgments ...............................................................................................................................15

FIGURES

Figure I - Section 841 Process..................................................................................................................................12

ABBREVIATIONS

AFCEC Air Force Civil Engineer Center

CENTCOM Central Command

C-JTSCC Central Command-Joint Theater Support Contracting Command

DFARS Defense Federal Acquisition Regulation Supplement

DOD Department of Defense

HCA Head of Contracting Activity

ISAF International Security Assistance Force

NDAA National Defense Authorization Act

OSD AT&L Office of the Under Secretary of Defense for Acquisition, Technology, and Logistics

TF2010 Task Force 2010

SIGAR Special Inspector General for Afghanistan Reconstruction

USACE U.S. Army Corps of Engineers
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 2

After 10 years of contingency operations, contractors continue to support U.S. military and civilian-led efforts in 

Afghanistan by providing a broad range of supplies, services, and critical logistics functions. In fiscal year 

2012, the U.S. Central Command (CENTCOM) 1 Joint Theater Support Contracting Command (C-JTSCC) data 

showed that it awarded 9,733 contracts, valued at approximately $1.7 billion. 2 The first quarter fiscal year

2013 manual census conducted by CENTCOM reported 110,000 contract personnel working in Afghanistan

between October and December 2012. Reflecting U.S. and coalition guidance that emphasizes the importance

of local contracting, C-JTSCC awarded 8,634 of these contracts—about 89 percent of the total contract value—

to Afghan contractors. Several prior audit and research reports discuss the numerous and unique challenges

of contracting in Afghanistan, particularly with non-U.S. contractors.3 These challenges include the limited

availability of oversight staff for contracts, the small pool of qualified local contractors, and an environment of

insecurity and corruption that increases the risk of U.S. funds being misused to finance terrorist or insurgent

groups.

To reduce the risk and effects of inadvertently contracting with individuals or entities that have links to and 

could provide funds to insurgents and others who oppose U.S. and coalition forces, Congress included Section 

841—Prohibition on Contracting with the Enemy in the United States Central Command Theater of Operations—

in the National Defense Authorization Act (NDAA) for Fiscal Year 2012. 4 Section 841 permits the Department 

of Defense (DOD), pursuant to a request from the CENTCOM Commander, to authorize the Head of a 

Contracting Activity (HCA) to restrict, terminate, or void a DOD contract, grant, or cooperative agreement that it 

determines would provide funding directly or indirectly to a person or entity identified as actively supporting an 

insurgency or otherwise actively opposing U.S. or coalition forces in the CENTCOM theater of operations, 

including Afghanistan. 5

This report (1) describes the processes DOD has established to implement Section 841, (2) assesses the 

extent to which DOD’s policies and procedures for implementing Section 841 have been able to identify and 

prevent U.S. contracting funds from being provided to individuals and entities identified as actively supporting 

an insurgency or opposing U.S. or coalition forces in Afghanistan, and (3) lists some areas of the Section 841 

legislation that could be strengthened to prevent contracting with the enemy.

To accomplish our objectives, we reviewed Section 841 and examined a variety of DOD contracting policies and

procedures. These policies and procedures included the Defense Federal Acquisition Regulation Supplement

(DFARS), C-JTSCC acquisition procedures, and International Security Assistance Force (ISAF) contracting and

counterinsurgency guidance. Additionally, we sent a standardized questionnaire to DOD’s HCAs in order to

identify the policies and procedures they used to consider the CENTCOM Commander’s request and the factors

considered when determining whether to restrict, terminate, or void a contract, grant, or cooperative agreement

after being notified of a Section 841 designation. We also reviewed a judgmental sample of 230 contracts 

from the U.S. Army Corp of Engineers (USACE), Air Force Civil Engineering Center (AFCEC), and C-JTSCC to 

ensure compliance with Section 841 requirements. We interviewed relevant DOD officials from the Office of 

 

1 CENTCOM is one of the nine combatant commands in the U.S. military. Its area of responsibility consists of 20 countries 

in Middle East and Southwest Asia, including Afghanistan.

2 This figure represents C-JTSCC only and does not reflect the entire universe of contracts in the Afghanistan theater of 

operation.

3 Government Accountability Office, U.S. Efforts to Vet Non-U.S. Contractors Need Improvement, GAO-11-355, 6/8/2011;

Congressional Research Service, Wartime Contracting in Afghanistan: Analysis and Issues for Congress,11/14/2011.

Committee on Oversight and Government Reform, Warlord, Inc.: Extortion and Corruption Along the U.S. Supply Chain in 

Afghanistan, 6/22/2010.

4 Pub. L. 112-81.

5 According to Defense Federal Acquisition Regulation Supplement, Subpart 202.1, a DOD contracting activity is an entity 

designated by the director of a defense agency with contracting authority through its agency charter. For example, the U.S.

Army Corps of Engineers is considered an HCA. Large DOD agencies, such as the Department of the Army, may have 

multiple HCAs under their command.
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 3

the Under Secretary of Defense for Acquisition, Technology, and Logistics (OSD AT&L), CENTCOM, USACE, and 

AFCEC. We conducted our work in Washington, D.C.; Tampa, Florida; San Antonio, Texas; and Kabul, Kandahar, 

and Parwan provinces in Afghanistan from August 2012 to April 2013 in accordance with generally accepted 

government auditing standards. A discussion of our scope and methodology is included in appendix I

BACKGROUND

The International Security Assistance Force (ISAF) Commander’s counterinsurgency contracting guidance

issued in September 2010, and similar contracting guidance issued by the Department of State and the U.S.

Agency for International Development in November 2010, confirmed the importance of contracting to the U.S.

mission in Afghanistan. In particular, the guidance emphasizes the importance of contracting with Afghan

contractors and purchasing Afghan goods—a policy collectively known as Afghan First—as a key element of the

U.S. counterinsurgency strategy. 6 However, in light of cases like the Host Nation Trucking contract, 7 in which

funds paid by contractors for the safe passage of U.S. military goods are widely believed to have been funneled

to insurgents, the U.S. government has launched a variety of efforts to prevent contracting abuse and decrease

the likelihood of funds being diverted to terrorist or insurgent groups. 8

In an effort to prevent U.S. government contracting funds from being diverted to terrorist or insurgent groups, 

Congress included Section 841 in the fiscal year 2012 NDAA. In addition to establishing the prohibition on 

contracting with terrorist or insurgent groups, Section 841:

• Directs the Secretary of Defense to revise DFARS to reflect provisions of Section 841 no later than 30 

days after the date of enactment of the NDAA. 9

• Calls for the CENTCOM Commander to establish a program that uses intelligence data to review and 

identify persons and entities with DOD contracts, grants, or cooperative agreements that are actively 

supporting an insurgency or otherwise opposing U.S. or coalition forces in a contingency operation in 

Afghanistan or other countries in the CENTCOM theater of operations. 10

• Permits the Secretary of Defense to authorize an HCA, pursuant to a request from the CENTCOM 

Commander, to restrict, terminate, or void a contract determined to provide funding to active insurgent 

elements and opponents of U.S. or coalition forces.

• Requires all contracts with an estimated value over $100,000 that will be performed in the CENTCOM 

theater of operations to include a clause notifying the contractor or recipient to exercise due diligence 

to ensure that none of the funds received under the contract are provided directly or indirectly to a 

person or entity actively supporting an insurgency or opposing U.S. or coalition forces. The clause also 

 

6 We previously reported on the Afghan First Initiative (see SIGAR Audit-12-6, Afghan First Initiative Has Placed Work with 

Afghan Companies, but Is Affected by Inconsistent Contract Solicitation and Vetting, and Employment Data Is Limited, 

January 31, 2012).

7 The principal contract supporting the U.S. supply chain in Afghanistan was Host Nation Trucking, a $2.16 billion contract 

split among eight Afghan, American, and Middle Eastern companies. The Host Nation Trucking contract provided trucking 

for over 70 percent of the total goods and materiel distributed to U.S. troops in the field—roughly 6,000 to 8,000 truck 

missions per month. The trucks carried food, supplies, fuel, ammunition, and Mine Resistant Ambush Protected vehicles.

8 The U.S. government’s efforts to prevent contracting abuse and prevent the diversion of funds to terrorist or insurgent 

group include (1) DOD and U.S. Agency for International Development programs to vet non-U.S. contractors; (2) interagency 

task forces created to identify malign actors, encourage transparency, and prevent corruption, such as Task Force 2010 

and the Afghan Finance Threat Cell; and (3) DOD training programs for contracting officer representatives with a focus on 

contingency operations.

9 This was achieved through DFARS Class Deviation 2012-O0005, which the Under Secretary of Defense for Acquisition, 

Technology, and Logistics Office of Defense Procurement and Acquisition Policy issued on January 26, 2012.

10 For the purposes of this report, we use the term “contract” to refer collectively to contracts, grants, cooperative 

agreements, and task orders, unless noted otherwise.
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 4

requires HCAs to inform contractors or recipients of grants and cooperative agreements of the HCAs’ 

authority to terminate, restrict, or void the contract.

• Requires the Secretary of Defense to report annually to the congressional defense committees on the 

use of authorities provided under Section 841.

DOD HAS ESTABLISHED A TWO-PHASE PROCESS TO COMPLY WITH SECTION 841

DOD, through CENTCOM, has implemented a two-phase process to comply with Section 841. The first phase of 

the process involves targeting, reviewing, and designating a Section 841 person or entity, and, ultimately,

notifying HCAs of these designations. U.S. Forces–Afghanistan’s 11 Task Force 2010 (TF2010) currently

administers the intelligence portion established by Section 841. 12 TF2010 primarily identifies targets for a 

potential Section 841 designation through self-initiated cases and contractor vetting reports. Once a target has

been identified, TF2010 assembles an information package on the target and conducts preliminary intelligence

and legal analyses for the TF2010 Director’s approval. Once approved by the TF2010 Director, the Section 841 

information package is routed through a series of coordinating agencies of ISAF Joint Command for review and 

concurrence before it goes to CENTCOM Command for a final decision and designation. If the CENTCOM 

Commander approves it, 13 the Commander prepares an unclassified Section 841 notification letter listing the 

person or entities identified, along with a request that the heads of agency or HCAs exercise the authority 

provided in Section 841 to restrict, terminate, or void contacts with those listed. CENTCOM then distributes the

notification letter via email to key heads of agency and select HCAs. 14

In the second phase, the key heads of agency and select HCAs determine if they have any contracts with the 

person or entity listed in the CENTCOM notification letter. The process concludes when the head of agency or 

HCA responds to CENTCOM with information on the number and value of any contracts with the person or entity

and the actions taken on the contracts. For a more detailed description of the Section 841 process, see 

appendix II.

As of January 18, 2013, CENTCOM has issued four notification letters identifying five companies and their 

associates as supporters of enemy groups. 15 According to DOD officials, no prime contracts have been 

terminated as a result of these Section 841 designations because none were active when the designation took 

effect. 16 However, at the direction of USACE and AFCEC contracting officers, a prime contractor terminated 

eight active subcontracts awarded to a Section 841 designee. The value of these subcontracts was 

 

11 U.S. Forces–Afghanistan is under the command of CENTCOM.

12 TF2010 is a unit made up of intelligence, law enforcement, auditors, and forensic analysts from both military and civilian 

agencies. Its mission is to help commanders and acquisition teams better understand with whom they are doing business 

and recommend actions that deny power-brokers, criminal, and insurgent actors the opportunity to benefit from diverted 

U.S. contracting dollars and government-funded equipment and supplies, thus undermining the U.S. government’s 

reconstruction and counterinsurgency efforts.

13 As of January 18, 2013, the CENTCOM Commander had approved all five Section 841 cases received.

14 The CENTCOM Section 841 notification letter distribution list continues to evolve, and currently is composed of a 

combination of heads of agency, such as the Department of the Army, and HCAs, such as the National Security Agency.

15 On January 18, 2013, CENTCOM issued the fourth notification letter on the Kam Airlines group of companies and their 

associates. On February 9, 2013, CENTCOM suspended the January 18, 2013, notification, with the understanding that an 

independent investigation of the activities of Kam Air and their associates will be conducted by the Government of 

Afghanistan. For a complete listing of Section 841 designated companies and their affiliates, please visit the CENTCOM 

website at www2.centcom.mil/sites/contracts.

16 DOD previously held contracts with parties identified within the four Section 841 notification letters. According to 

officials, USACE had awarded at least seven contracts, valued at over $35 million, to persons or entities that currently have 

a Section 841 designation. However, the agency awarded these contracts prior the enactment of the fiscal year 2012 

NDAA, and the contracts were no longer active at the time of the Section 841 designation.
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 5

approximately $12 million; about $5 million of these funds had already been paid to the subcontractor when

the contracts were terminated.

WEAKNESSES EXIST IN DOD’S SECTION 841 PROCESS

Currently, DOD’s Section 841 process does not provide reasonable assurance that HCAs are identifying all 

contracts awarded to persons or entities that are supporting the insurgents or other enemies. Because HCAs 

do not have visibility over most subcontracts awarded in Afghanistan, agencies must rely on prime contractors 

to determine whether they have awarded any subcontracts to persons or entities listed in a Section 841 

notification letter. The DFARS class deviation issued in response to the Section 841 legislation requires that all

new contracts and solicitations with an estimated value over $100,000 being performed in the CENTCOM 

theater of operations include language prohibiting contractors from entering into subcontracts with persons or 

entities determined to be aiding the enemy. It also states that agencies shall, to the maximum extent 

practicable, bilaterally or mutually modify existing contracts to include this language. In addition, the language 

informs contractors of authorities granted to HCAs under Section 841 to restrict, terminate, and void a contract 

if they determine the contractor failed to exercise due diligence in preventing funds from going to persons or 

entities receiving Section 841 designations.

However, our review of a judgmental sample of 129 contracts at select C-JTSCC Regional Contracting Centers 

found that contracting officers had not modified the base contracts for 28 reviewed task orders—issued on 

contracts awarded prior to the enactment of Section 841—to include the DFARS clause. We also found that 31 

of the remaining 101 contracts, awarded after enactment of Section 841, did not contain the clause. Failureto

include the clause in new and pre-existing contracts means that contractors may be unaware of the authorities

granted to HCAs to terminate contracts under Section 841 and the requirement that they perform due diligence

to avoid contracting with Section 841 designees.

During our reviews of contracts, we determined that 1 of the 66 USACE contracts and 4 of the 35 AFCEC 

contracts reviewed did not include the full text of the clause. USACE and AFCEC have already taken steps to 

include the DFARS clause in base contracts when a new task order is placed on a contract that was issued prior

to the enactment of Section 841.

HCAs and Prime Contractors Do Not Consistently Receive Notification of Section 841 Designations

Under Section 841, HCAs are responsible for identifying and making a determination of action on any contracts 

issued to persons or entities designated in the CENTCOM Commander’s notification letter. CENTCOM 

distributes the notification directly to key heads of agency and select HCAs, who are then responsible for 

distributing the letters to their subordinate agencies. However, not all HCAs have received the distributed 

notification letters. For example, USACE did not receive the first notification letter, dated July 24, 2012, from 

the Department of the Army until the issuance of the second letter on September 20, 2012. Also, the Office of 

the Undersecretary of Defense for Acquisition, Technology and Logistics (OSD AT&L) 17 currently has not

provided formal guidance for the dissemination of Section 841 notification letters from the head of agency level

to subordinate HCAs. While HCAs and contracting officials could obtain Section 841 designations from the

Joint Contingency Contracting System,they are not required to review information in the system. 18 Further,

some agencies overseeing contracts in Afghanistan may not be familiar with the Joint Contingency Contracting

 

17 OSD AT&L is responsible for establishing policies for acquisition (including procurement of goods and services, research 

and development, developmental testing, and contract administration), for all elements of the Department of Defense.

18 The Joint Contingency Contracting System, a contracting database, is the only system in which CENTCOM records 

Section 841 designations. However, a DOD official stated that only contracting officers can view that information in the 

system.
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 6

System. 19 Agencies that do not receive the notification letters and do not have access to the Joint Contingency 

Contracting System may be unaware of the persons or entities designated under Section 841, and, as a result, 

maybe unable to terminate, restrict, or void contracts with the designees as stipulated in the law.

Moreover, HCAs have not consistently informed their prime contractors of Section 841 designations or sent 

them copies of the notification letters. The CENTCOM Commander included language in the third Section 841 

notification letter requesting that HCAs disseminate the letter to their prime contractors and notify CENTCOM of

any subcontracts with the designees listed. 20 However, OSD AT&L has not developed formal policies requiring

HCAs to disseminate Section 841 notification letters to all their prime contractors. Further, prime contractors

do not have access to an information system, such as the Joint Contingency Contracting System, that includes

data on companies with Section 841 designations. In January 2013, CENTCOM began posting Section 841

designations on its website; however, contracting officers and prime contractors are not currently required to

regularly review the listed designations. If prime contractors do not receive the notification letters or have the

ability to access a system containing information on Section 841 designees, they may be unaware of Section

841 designations and continue to subcontract or award future subcontracts to persons or entities identified as 

actively supporting the insurgency or actively opposing U.S. or coalition forces in violation of the law.

Contractors Are Not Required to CertifyThatThey Do Not Have Contracts with Section 841 Designees

Because HCAs do not have full visibility over most subcontracts awarded, they must rely on their prime 

contractors’ due diligence to ensure that subcontracts are not awarded to persons or entities identified under 

Section 841. Although CENTCOM has begun to request that HCAs distribute the Section 841 notification to 

their prime contractors, there is no requirement for prime contractors to formally attest that they do not hold 

subcontracts with Section 841 designees. 21 As a result, officials have limited assurance that they are 

identifying all contracts with Section 841 designees.

DOD Lacks Guidance on Actions to Take After Exercising Section 841 Authorities

and Also Lacks Mechanisms for Tracking and Reporting Contracting Actions Implemented

DOD has not provided HCAs with guidance on how to address the possible consequences of using their Section 

841 authorities to terminate, restrict, or void a contract. For example, after receiving notification of the first 

Section 841 designee, AFCEC requested all of its prime contractors to identify subcontracts with the designee. 

As directed, a prime contractor terminated a subcontract with this designee. Although the Section 841 

designation is unclassified, the information CENTCOM uses to make a determination may be classified and is 

not shared with contractors. 22 As a result, in one instance, the prime contractor could not inform the

subcontractor of the reasons for the termination. In September 2012, the subcontractor filed a complaint

against the prime contractor with the Afghan government. As a result of the complaint, the prime contractor

contacted AFCEC for assistance. AFCEC subsequently contacted CENTCOM for guidance but did not view

CENTCOM’s suggestion that legal counsel should be sought as responsive to the issue. As of January 31,

2013, the matter was unresolved. USACE officials stated they experienced similar challenges with the same

subcontractor.

 

19 A supervisory contracting officer with AFCEC informed us that contracting officials with his agency in Afghanistan do not 

utilize the Joint Contingency Contracting System for any contracting activities.

20 The third Section 841 notification letter is dated November 16, 2012.

21 Section 842 of the fiscal year 2012 NDAA gives DOD authority to examine the records of contractors as well as their 

subcontractors, if there is reason to believe that funds available under the contract may have been subject to extortion, 

corruption or may have been provided to person or entities actively supporting an insurgency or opposing U.S. or coalition 

forces. However, DOD may not know which prime contractors hold subcontracts with Section 841 designees, and therefore 

may be unable to fully utilize Section 842 in support of Section 841.

22 Section 841 provides that such information can be shared pursuant to a protective order issued by a court of law.
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 7

AFCEC officials also expressed concerns about the lack of guidance for absorbing the financial costs of 

exercising Section 841 authorities. For example, with the termination of the contract with the Section 841 

designated subcontractor, AFCEC incurred further expenses as its prime contractor sought and employed a new

company to complete the work once performed by the Section 841 designee. Without established guidance,

HCAs and prime contractors are at risk of facing legal challenges from Section 841 designees and may have to

absorb financial costs associated with implementing Section 841 authorities.

In addition, DOD does not centrally track responses to the Section 841 notification letters and actions taken to 

terminate, restrict, or void contracts. Under Section 841, the Secretary of Defense is required to report 

annually by March 1 of 2013, 2014, and 2015, to various congressional committees on the use of the

section’s authorities during the preceding year. OSD AT&L, specifically the Office of Defense Procurement and 

Acquisition Policy, is responsible for submitting the mandated report and is obtaining this data directly from the 

various services and other contracting agencies. CENTCOM is also collecting Section 841 data, resulting in a 

duplication of effort. OSD and CENTCOM officials informed us that they plan to compare the data collected for 

consistency and accuracy. Without a centralized tracking mechanism, DOD may continue to duplicate data 

collection efforts.

SECTION 841 LEGISLATION NEEDS TO BE STRENGTHENED

In addition to the weaknesses identified in DOD’s processes, we noted several limitations in Section 841 of the

NDAA. First, not all DOD contracts within Afghanistan are subject to the provisions of Section 841 because the

section only applies to contracts valued in excess of $100,000. However, a large number of awarded contracts

are below the $100,000 threshold. For example, 7,730 of 9,733 (or approximately 80 percent) contracts CJTSCC awarded in fiscal year 2012 were contracts valued under $100,000. Furthermore, 82 percent of

contracts awarded to Afghan entities fell below this threshold.

Second, because Section 841 provisions expire on December 31, 2014, the future status of contracts and 

Section 841 designees is unclear. Specifically, the legislation does not address whether Section 841 

provisions will continue to apply to contracts entered into prior to but active after the expiration date. If Section 

841 provisions are not reauthorized, HCAs’ authority to terminate, restrict, or void active contracts with entities 

and individuals found to be in violation of Section 841 may be limited. In addition, if Section 841 designees 

are not prohibited from contracting with DOD under alternative measures after 2014, it is possible that DOD’s

contracting agencies may enter into contracts with these persons or entities in the future. Finally, DOD officials

expressed concern that information and intelligence gathered through the Section 841 process may be lost if 

the provisions expire.

Third, as enacted, Section 841 applies only to DOD and its various agencies and organizations. Thus, agencies 

other than DOD—most notably the Department of State and U.S. Agency for International Development—are not 

subject to its provisions. 23 SIGAR issued an alert letter on October 17, 2012 notifying the Department of State 

and the U.S. Agency for International Development of the first two groups of individuals and entities identified 

as Section 841 designees. This alert letter acknowledged that, while Section 841 only affects DOD contracts, 

both the Department of State and the U.S. Agency for International Development use many of the same 

contractors as DOD, and consequently there could be a present or future risk that the Department of State and 

the U.S. Agency for International Development could have active prime or subcontracts with Section 841 

designees. We are addressing Department of State and U.S. Agency for International Development efforts to 

prevent contracting with the enemy in a separate review.

 

23 As of the third notification letter dated November 16, 2012, the Department of State and U.S. Agency for International 

Development are included in CENTCOM’s distribution list.
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 8

CONCLUSION

Although DOD has established a process to implement Section 841, weaknesses in the process prevent the 

department from having reasonable assurance that it is identifying all contracts held by persons or entities 

determined to be actively supporting the insurgency and opposing U.S. or coalition forces. Because HCAs do 

not have visibility over subcontracts awarded in Afghanistan, they rely exclusively on prime contractors to 

determine whether they have awarded subcontracts to persons or entities with Section 841 designations. 

However, contracting agencies do not require prime contractors to certify that they do not have contracts with 

Section 841 designees, making it difficult for DOD to identify and terminate contracts with supporters of the 

insurgency and other enemy groups. As a result, millions of U.S. contracting dollars could be diverted to forces 

seeking to harm U.S. military and civilian personnel in Afghanistan and derail the multi-billion dollar 

reconstruction effort.

In addition, DOD also has not developed guidance describing the steps HCAs should take to respond to any 

legal challenges brought and financial liabilities incurred as a result of contracts terminated under Section 841.

Therefore, HCAs and prime contractors may not be able to respond appropriately or consistently to these 

challenges. Further, prime contractors may be less inclined to terminate, restrict, or void subcontracts with 

Section 841 designees when faced with increased expenses and unclear or limited legal recourse.

Finally, Section 841 could be strengthened to ensure that all contracts in Afghanistan and other countries in

the CENTCOM theater of operations are subject to its provisions—specificallyDepartment of State and U.S. 

Agency for International Development. Further, it is unclear whether the Section 841 designations will be 

enforceable, and the related information will be maintained, after the legislation expires at the end of 2014, 

even though U.S. agencies will continue to contract in Afghanistan after the military drawdown and transition 

are complete. Consequently, agencies may continue to contract or enter into new contracts with persons and 

entities identified as supporting the enemy and other groups opposing the U.S. and coalition forces, thus 

increasing the risk that U.S. taxpayer funds could be diverted to these enemy groups.

RECOMMENDATIONS

To improve DOD’s visibility over active contracts in Afghanistan, particularly subcontracts, so that they can take 

the required action if necessary, we recommend that the Director of the Office of Defense Procurement and 

Acquisition Policy,

1. Require all Heads of Agency in the CENTCOM theater of operations, including Afghanistan, develop a 

standard mechanism for distributing Section 841 notification letters to their HCAs. 

2. Require all HCAs with contracts in the CENTCOM theater of operations, including Afghanistan, to 

develop a standard mechanism for distributing Section 841 notification letters to all prime 

contractors. 

3. Direct HCAs to require prime contractors to certify that they do not have subcontracts with Section 

841 designees. 

4. Require all DOD contracting agencies and prime contractors with contracts in the CENTCOM theater of 

operations to use an information system, such as the Joint Contingency Contracting System or the 

CENTCOM website, to track the Section 841 designations. 

5. Enforce DFARS Class Deviation 2012-O0005 that requires the Section 841 clause be included in 

contracts, unless HCAs provide justification for exemption. 
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 9

To prevent duplication of data collection efforts, we recommend that the Director of the Office of Defense

Procurement and Acquisition Policy, in coordination with the Commander of U.S. Central Command,

6. Formally assign either the Office of Defense Procurement and Acquisition Policy or CENTCOM the 

responsibility for centrally tracking, at a minimum, the number and value of contracts, grants, and 

cooperative agreements HCAs have restricted, terminated, or voided using their Section 841 

authorities. 

To ensure that HCAs have the information needed to respond to any legal challenges and financial liabilities 

resulting from exercising Section 841 authorities, we recommend that the Director of the Office of Defense 

Procurement and Acquisition Policy, in coordination with relevant agency contracting offices,

7. Develop and distribute guidance to HCAs about actions to take once they have restricted, terminated, 

or voided a contract under Section 841. 

MATTERS FOR CONGRESSIONAL CONSIDERATION

To ensure that all contracts in Afghanistan are subject to the provisions of Section 841, Congress may wish to 

consider revising the legislation to eliminate the $100,000 threshold value for contracts.

To provide DOD with greater clarity on the future of designations and efforts made under Section 841, 

Congress may wish to consider providing guidance on the status of the designations once the legislation 

expires on December 31, 2014. If the intent is for Section 841 designations to expire with the legislation, 

Congress may wish to consider requiring contracting agencies to preserve information and intelligence 

gathered through the Section 841 process and take this information into account when awarding new contracts

in 2015 and beyond.

AGENCY COMMENTS

CENTCOM, USACE, and AFCEC provided technical comments, which we incorporated into our final report, as 

appropriate. DOD’s Office of Defense Procurement and Acquisition Policy officials provided informal comments 

that generally supported our recommendations for improving the process for notifying the DOD acquisition 

community and contractors of Section 841 designees, and stated that they will provide formal comments after 

the release of the final report. When received, we will address these comments in a separate document and 

post to our website at www.sigar.mil. 
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 10

APPENDIX I - SCOPE AND METHODOLOGY

Our objectives were to (1) describe the processes Department of Defense (DOD) has established to implement

Section 841, (2) assess the extent to which DOD’s policies and procedures for implementing Section 841 have

been able to identify and prevent U.S. contracting funds from being provided to individuals and entities

identified as actively supporting an insurgency or opposing U.S. or coalition forces in Afghanistan, and (3)

identify areas of the Section 841 legislation that could be strengthened to prevent contracting with the enemy.

To describe the processes DOD established to implement Section 841, we reviewed the provisions of Section 

841 and several recent DOD contracting policies. These policies included the Defense Federal Acquisition 

Regulation Supplement (DFARS), the September 2011 United States Central Command (CENTCOM) 

Contracting Command (C-JTSCC) Acquisition Instruction, the May 2012 Contracting Officer’s Guide for Theater 

Business Clearance for Afghanistan, the International Security Assistance Force Commander’s contracting 

guidance, and the U.S. government counterinsurgency guide. 24 We also examined Task Force 2010’s 

(TF2010) Section 841 designation policies and procedures and designation packages, as well as the CENTCOM

Vendor Vetting Reachback Cell’s processes for vetting contractors doing work in support of U.S. forces in

Afghanistan and Iraq. We sent a standardized questionnaire to 23 heads of agency and Heads of Contracting

Activity (HCA) listed in the second CENTCOM Commander’s Section 841 designation letter. The questionnaire

sought to identify the policies and procedures used by heads of agency and HCAs to consider the CENTCOM

Commander’s request and the factors they considered in determining whether to exercise the authority

provided by Section 841. We received and analyzed 11 responses.

To assess the extent to which DOD’s Section 841 policies and procedures have been able to identify and 

prevent U.S. contracting funds from being provided to individuals and entities identified as actively supporting 

an insurgency or opposing U.S. or coalition forces, we interviewed DOD officials representing the Office of

Defense Procurement and Acquisition Policy, 25 CENTCOM and its Vendor Vetting Reachback Cell, U.S. Army 

Corp of Engineers (USACE) Transatlantic Division, and the Air Force Civil Engineering Center (AFCEC). We also 

interviewed U.S. Forces–Afghanistan and C-JTSCC officials including the Senior Contracting Official–

Afghanistan, the Director and other representatives of TF2010, and officials from Regional Contracting Centers 

at Camp Phoenix in Kabul, Bagram Air Field, and Kandahar Air Field. In addition, we interviewed officials from 

the USACE Afghanistan Engineer District-North and South and a senior AFCEC contracting representative in 

Kabul. As part of evaluating DOD’s established Section 841 policies and procedures, and to ensure 

compliance with Section 841 and DFARS contract clause requirements, we reviewed 230 contracts awarded

between February 1, 2012 and September 30, 2012 by one of three agencies─C-JTSCC, USACE and

AFCEC─with the contracts located in Kabul, Kandahar, and Parwan, Afghanistan and San Antonio, Texas.

To identify areas of the Section 841 legislation that could be strengthened, we reviewed Section 841 of the 

National Defense Authorization Act (NDAA) for Fiscal Year 2012. In addition, we interviewed relevant DOD 

officials that were familiar with Section 841 legislation.

We did not use or rely on computer-processed data for the purposes of the audit objectives. With respect to 

assessing internal controls, we reviewed compliance with Section 841 and the DFARS. The results of our 

assessment are included in the body of this report.

We conducted work in Washington, D.C.; Tampa, Florida; San Antonio, Texas; and Kabul, Kandahar, and 

Parwan provinces in Afghanistan from August 2012 to April 2013, in accordance with generally accepted 

government auditing standards. These standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our 

 

24 Theater Business Clearance requirements are generated from Battlefield Commander orders and apply to contracts in 

the battle space.

25 The Office of Defense Procurement and Acquisition Policy reports to the Office of the Under Secretary of Defense for 

Acquisition, Technology, and Logistics.
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 11

audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives. The audit was conducted by the Office of Special Inspector General 

for Afghanistan Reconstruction under the authority of Public Law No. 110-181, as amended; the Inspector 

General Act of 1978; and the Inspector General Reform Act of 2008.
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 12

APPENDIX II - DEPARTMENT OF DEFENSE SECTION 841 IMPLEMENTATION 

PROCESS

The Department of Defense (DOD), through U.S. Central Command (CENTCOM), has implemented a two-phase 

process to comply with the provisions of Section 841—Prohibition on Contracting with the Enemy in the United 

States Central Command Theater of Operations—of the National Defense Authorization Act for Fiscal Year 

2012. 26 The first phase of this process involves targeting, reviewing, and designating Section 841 persons or 

entities, and notifying heads of agency and Heads of Contracting Activity (HCA). In the second phase, the head 

of agency or HCA receives the notification and determines if it has any contracts with the person or entity listed 

in the notification. The process concludes when the head of agency or HCA responds to CENTCOM with the 

number and value of contracts identified with the person or entity and the actions taken on those contracts.

Figure I - Section 841 Process

Source: SIGAR analysis of Task Force 2010 Section 841 process flow chart and interviews with task force and select Heads 

of Contracting Activity officials.

 

26 Pub. L. 112-81.
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 13

Phase One: CENTCOM Analyzes Information on Section 841 Targets, Approves 

Designations, and Notifies Key Heads of Agency and Select HCAs

As the entity charged by CENTCOM to initiate the Section 841 designation process, Task Force 2010 (TF2010) 

identifies targets from self-initiated cases, Vendor Vetting Reach Back Cell (VVRC) reports, and other sources. 27

Approximately 50 percent of TF2010’s targets are self-initiated cases. These are cases initiated based on the 

task force’s criminal investigations or where the task force has been investigating an individual or entity for an 

extended period of time. 28 About 25 percent of Section 841 cases are built from VVRC reports. These reports 

assign non-U.S. contractors a force protection evaluation rating. 29 Because Section 841 only applies to 

persons or entities that are actively supporting the insurgency or opposing U.S. and coalition forces, TF2010 

determines whether the intelligence gathered is recent enough to pursue a Section 841 designation. 30 The 

remaining 25 percent of TF2010 targets are generated by other sources, such as the International Criminal

Investigation Task Force 31 and the Afghan Threat Finance Cell. 32

Review Process and Designation

According to TF2010 officials, once they have targeted a prospect, they assemble an informational intelligence 

package on the person or entity. The intelligence package contains information such as known civil and 

criminal activities, affiliations and associations with malign actors, and known terrorism and insurgent ties, and 

may include unclassified or classified data. The assessment is a compilation of all information TF2010 

believes CENTCOM needs to make a determination of whether to give the person or entity being targeted a 

Section 841 designation. 33 TF2010 ultimately determines if a target is actively supporting an insurgency or 

otherwise opposing U.S. or coalition forces based on the quality, quantity, timeliness, and level of corroboration 

of the evidence. Once a target has been confirmed based on the evidence, the package also undergoes an 

internal legal review.

TF2010 subsequently conducts a contract impact analysis to identify any potential second or third order 

effects. This analysis helps to determine the consequences in the area of operations if the contractor were to 

be removed. For example, the person or entity targeted may be the only contractor available to provide the 

good or service in the area of operations and removing the contractor may prove detrimental to the overall 

mission.

After these steps are completed and the Director of TF2010 approves the package, it is routed through a series

of coordinating agencies within the International Security Assistance Force (ISAF) Joint Command for review

 

27 The Vendor Vetting Reachback Cell is responsible for vetting all non-U.S. contractors bidding for contracts equal to or 

above $100,000 in the Afghanistan theater of operations.

28 TF2010 tracks targets by maintaining a top 15 list of active targets.

29 After completing an investigation on a contractor, the Vendor Vetting Reachback Cell creates an analytical report and 

classifies contractors into one of four force protection risk levels: moderate, significant, high, or extremely high. High or

extremely high risk levels generally result in the contractor being excluded from further consideration for new contract 

awards. TF2010 has ranked approximately 1,600 to 1,700 Vendor Vetting Reachback Cell reports based on these 

assigned force protection ratings.

30 TF2010 generally considers information that is no more than 90 days old.

31 The International Criminal Investigation Task Force conducts investigations of detainees captured in the war on 

terrorism. The task force includes representatives from the Army Criminal Investigation Division, Naval Criminal 

Investigative Service, and Air Force Office of Special Investigations. 

32 Formed in 2008 by the U.S. Drug Enforcement Administration, the Afghan Threat Finance Cell identifies, tracks, and 

attempts to disrupt financial networks that fund insurgents.

33 During this part of the process, TF2010 considers information such as (1) force protection—the factors that are most 

critical for troop safety, (2) the number of open contracts and what these contracts are providing, and (3) contract size—

how much money is flowing to the enemy.
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 14

and agreement before it reaches CENTCOM for a final decision. The Section 841 designation package receives

a number of senior level approvals, including approvals by the Deputy Chief of Staff of ISAF Joint Command, the

Commander of ISAF Joint Command, and the Commander of ISAF/U.S. Forces–Afghanistan, before finally

reaching CENTCOM. Once at CENTCOM, the package is subject to another intelligence review in addition to

legal evaluation from the CENTCOM Judge Advocate. The CENTCOM Commander then reviews the package

and all of the information compiled to this point and makes the final determination. 34

Notification

If the CENTCOM Commander approves the Section 841 designation package, the Commander writes an 

unclassified Section 841 notification letter listing the persons or entities involved, along with a request that the 

recipients exercise the authority provided in Section 841. 35 CENTCOM then distributes the Section 841 

notification letter by email to key heads of agency and select HCAs.

Phase Two: HCAs Identify Contracts with Section 841 Designees and Determine

Whether to Restrict, Terminate, or Void Affected Contracts

Once heads of agency and HCAs receive the Section 841 notification letter, they are responsible for 

determining if subordinate commands have any contracts with the identified persons or entities. Although not 

required by Section 841, the CENTCOM Commander directs the heads of agency and HCAs to report back, at a 

minimum, on the number of contracts they restricted, terminated, or voided, and the value of those contracts.

Based on our review of responses to a standardized questionnaire from 11 of the 23 heads of agency and 

HCAs on CENTCOM’s 841 notification letter distribution list as of September 17, 2012, we determined that 

their processes to identify and report on contracts held with Section 841 designees ranged from formal to ad 

hoc. Seven of the 11 respondents indicated that they had no formal or written policies and procedures to 

comply with CENTCOM’s directive or Section 841 provisions. For example, one HCA responded that a formal 

written policy does not exist with regard to Section 841 notifications. Instead, the agency conducts an informal 

poll of its contracting officers and believes this informal querying process is sufficient. Another noted that a 

formal process was unnecessary due to the low probability of the agency having a contract, grant, or 

cooperative agreement affected by the CENTCOM Commander’s notification letter. Of the four agencies that 

reported using formal or written procedures, three stated they were currently in the draft or review stage of 

finalizing the procedures; however, these draft procedures primarily consisted of querying their respective 

contract databases and notifying their contracting officers of the Section 841 notification letter.

 

34 A total of six Generals are part of the review, coordination, and determination process.

35 According to the provisions of Section 841, the CENTCOM Commander can request, not require, that an HCA restrict, 

terminate, or void a contract, grant, or cooperative agreement.
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 15

APPENDIX III - ACKNOWLEDGMENTS

Gabriele Tonsil, Senior Audit Manager

Scott Harmon, Auditor-in-Charge 

Paola Bobadilla, Program Analyst 

Martin Wilson, Program Analyst
SIGAR Audit 13-6/DOD Compliance with Section 841 of the FY2012 NDAA Page 16

This inspection report was conducted under 

project code SIGAR-066A.
Obtaining Copies of SIGAR 

Reports and Testimonies

To Report Fraud, Waste, and 

Abuse in Afghanistan 

Reconstruction Programs

Public Affairs

SIGAR’s Mission

The mission of the Special Inspector General for Afghanistan 

Reconstruction (SIGAR) is to enhance oversight of programs for the 

reconstruction of Afghanistan by conducting independent and 

objective audits, inspections, and investigations on the use of 

taxpayer dollars and related funds. SIGAR works to provide accurate 

and balanced information, evaluations, analysis, and 

recommendations to help the U.S. Congress, U.S. agencies, and 

other decision-makers to make informed oversight, policy, and 

funding decisions to: 

• improve effectiveness of the overall reconstruction 

strategy and its component programs; 

• improve management and accountability over funds 

administered by U.S. and Afghan agencies and their 

contractors; 

• improve contracting and contract management 

processes; 

• prevent fraud, waste, and abuse; and 

• advance U.S. interests in reconstructing Afghanistan. 

To obtain copies of SIGAR documents at no cost, go to SIGAR’s Web 

site (www.sigar.mil). SIGAR posts all publically released reports, 

testimonies, and correspondence on its Web site. 

To help prevent fraud, waste, and abuse by reporting allegations of 

fraud, waste, abuse, mismanagement, and reprisal, contact SIGAR’s 

hotline: 

• Web: www.sigar.mil/fraud 

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