39464 Federal Register / Vol. 83, No. 154 / Thursday, August 9, 2018 / Notices 

1 12 CFR 367.1(c). 2 44 U.S.C. 3507(d). 

reproduction cost) payable to the United 

States Treasury. 

Henry Friedman, 

Assistant Section Chief, Environmental 

Enforcement Section, Environment and 

Natural Resources Division. 

[FR Doc. 2018–17023 Filed 8–8–18; 8:45 am] 

BILLING CODE 4410–15–P 

NATIONAL CREDIT UNION 

ADMINISTRATION 

RIN 3133–AE85 

NCUA Suspension and Debarment 

Procedures 

AGENCY: National Credit Union 

Administration (NCUA). 

ACTION: Final suspension and debarment 

procedures. 

SUMMARY: On March 15, 2018, the 

NCUA Board (Board) proposed new 

suspension and debarment procedures 

to protect the Federal Government’s 

interest in only doing business with 

presently responsible contractors. After 

consideration of public comments, this 

notice sets forth the NCUA’s final 

procedures for suspension and 

debarment and establishes 

administrative processes for contractors 

subject to the procedures. The final 

procedures will appear on the NCUA’s 

public website. 

DATES: These final procedures are 

applicable September 10, 2018. 

FOR FURTHER INFORMATION CONTACT: 

Kevin Tuininga, Associate General 

Counsel for Administrative Law, Office 

of General Counsel, National Credit 

Union Administration, 1775 Duke 

Street, Alexandria, Virginia 22314–3428 

or telephone: (703) 518–6543. 

SUPPLEMENTARY INFORMATION: 

I. Background 

II. Comments Received 

III. The Final Procedures 

IV. Regulatory Procedures 

I. Background 

On March 15, 2018, the NCUA Board 

(Board) proposed new suspension and 

debarment procedures as part of its 

efforts to modernize its procurement 

processes. These proposed procedures 

were intended to implement best 

practices in spending funds available to 

the NCUA, including those in the 

agency’s Operating Fund and the 

National Credit Union Share Insurance 

Fund. Although the NCUA is not 

required to follow government-wide 

acquisition laws and regulations, those 

laws and regulations have proven 

effective and include guidelines 

developed over years of seeking public 

comment on expenditure processes. 

Suspension and debarment remedies are 

now an important component of 

government procurement programs. 

After considering comments received, 

the Board has decided to adopt the 

procedures as proposed. 

II. Comments Received 

The Board received three comments 

on the proposal. Commenters included 

two national credit union trade 

associations and one regional trade 

association. All three commenters 

supported the proposal. One commenter 

suggested that the agency ‘‘consult with 

the [Office of the Inspector General] 

regarding whether such procedures 

would be of benefit to the NCUA Office 

of General Counsel.’’ 

The Board values these comments and 

believes it should adopt the procedures 

as proposed. Implementing these 

procedures in the near term ensures 

prompt compliance with the NCUA 

Inspector General’s recommendations. 

The Board is open to further 

recommendations of the Inspector 

General but, at this developing stage, 

declines to extend the final procedures 

to legal services agreements. Lawyers 

are subject to codes of professional 

responsibility related to their bar 

memberships, which already impose the 

highest standards of ethical conduct and 

include avenues for disciplinary action 

that can preclude further practice of 

law. This approach also aligns with the 

current practice of the Federal Deposit 

Insurance Corporation, which excludes 

law firms and lawyers from its 

contractor suspension and debarment 

procedures.1

III. The Final Procedures 

As discussed above, the Board has 

chosen to adopt the procedures as 

proposed. For a complete discussion of 

all eight sections of the procedures, 

please see the preamble to the proposed 

procedures at 83 FR 12318 (Mar 21, 

2018) or https://www.gpo.gov/fdsys/ 

pkg/FR-2018-03-21/pdf/2018-05626.pdf. 

The Board will post the final procedures 

on the NCUA website. 

IV. Regulatory Procedures 

A. Regulatory Flexibility Act 

For any final rule it adopts, the 

Regulatory Flexibility Act (RFA) 

requires the NCUA to prepare a final 

regulatory flexibility analysis that, 

among other things, describes the steps 

the agency has taken to minimize 

economic impact on small entities 

(currently defined by the NCUA as 

federally insured credit unions with 

under $100 million in assets), unless the 

NCUA certifies that the final rule will 

not have a significant economic impact 

on a substantial number of small 

entities. 

As discussed in the proposal, the 

NCUA does not expect the final 

Suspension and Debarment Procedures 

would ever apply to a federally insured 

credit union. In addition, the NCUA 

does not expect that the Procedures 

would have a significant economic 

impact on any other small businesses, as 

defined in the RFA and as further 

established by the Office of Advocacy of 

the Small Business Administration. 

The final procedures closely follow 

the suspension and debarment 

procedures of the Federal Acquisition 

Regulation, which already applies to 

government contractors, without 

imposing any additional economic 

burden. To the extent of any variation 

from the Federal Acquisition 

Regulations, the final procedures 

contain no recordkeeping or substantive 

regulatory requirements, varying only in 

adjudication processes. The final 

procedures therefore will not have a 

significant economic impact on a 

substantial number of federally insured 

credit unions under $100 million in 

assets or on other small entities as 

defined by the Small Business 

Administration. Accordingly, the NCUA 

has determined and certifies that the 

final procedures will not have a 

significant economic impact on a 

substantial number of small entities. No 

final regulatory flexibility analysis is 

required. 

B. Paperwork Reduction Act 

The Paperwork Reduction Act of 1995 

(PRA) applies to rulemakings in which 

an agency creates a new paperwork 

burden on regulated entities or modifies 

an existing burden.2 For purposes of the 

PRA, a paperwork burden may take the 

form of either a reporting or a 

recordkeeping requirement, both 

referred to as information collections. 

The final procedures will not create any 

new paperwork burden that meets the 

definition of an information collection. 

Thus, the NCUA has determined that 

these final procedures do not increase 

the paperwork requirements under the 

PRA and regulations of the Office of 

Management and Budget. 

C. Executive Order 13132 

Executive Order 13132 encourages 

independent regulatory agencies to 

consider the impact of their actions on 

state and local interests. The NCUA, an 

independent regulatory agency as 


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1Throughout these procedures, unless otherwise 

noted, the ‘‘NCUA’’ refers the NCUA in its agency 

capacity and also to the NCUA Board as conservator 

or liquidating agent for an insured credit union. 

Legal services contracts the NCUA enters into in 

any capacity, through the Office of General Counsel, 

are not subject to these suspension and debarment 

procedures. 

2 41 U.S.C. chapter 81. 

3Section 202 of the Defense Production Act; 

Public Law 102–558. 

4Section 201 of the Defense Production Act; 

Public Law 102–558. 

defined in 44 U.S.C. 3502(5), voluntarily 

complies with the executive order to 

adhere to fundamental federalism 

principles. These final procedures will 

not have a substantial direct effect on 

the states, on the relationship between 

the national government and the states, 

or on the distribution of power and 

responsibilities among the various 

levels of government. The NCUA has 

determined that the final procedures do 

not constitute a policy that has 

federalism implications for purposes of 

the executive order. 

D. Assessment of Federal Regulations 

and Policies on Families 

The NCUA has determined that these 

final procedures will not affect family 

well-being within the meaning of 

Section 654 of the Treasury and General 

Government Appropriations Act, 1999, 

Public Law 105–277, 112 Stat. 2681 

(1998). 

By the National Credit Union 

Administration Board on August 2, 2018. 

Gerard Poliquin, 

Secretary of the Board. 

For the reasons discussed above, the 

Board adopts the following NCUA 

Suspension and Debarment Procedures: 

NCUA Suspension and Debarment 

Procedures 

A. Purpose 

The purpose of these suspension and 

debarment procedures is to establish an 

administrative process to protect the 

Government’s interest in only doing 

business with presently responsible 

contractors. The NCUA 1 shall only 

solicit offers from, award contracts to, 

and consent to subcontracts with 

presently responsible contractors. These 

procedures implement the NCUA’s 

policies for suspension and debarment 

and establish administrative 

proceedings for contractors subject to 

the policies. 

B. Authority 

The NCUA’s suspension and 

debarment authority derives from the 

Federal Credit Union Act 12 U.S.C. 1751 

et seq., and 12 U.S.C. 1766(i)(2), 

specifically. The NCUA is not required 

to follow the Federal Acquisition 

Regulation but uses the principles 

therein for best practice guidance. The 

Federal Acquisition Regulation (FAR) 

section on suspension and debarment is 

located at 48 CFR part 9, subpart 9.4. 

The NCUA also has its own Acquisition 

Policy Manual. 

C. Definitions 

1. Action Referral Memorandum 

(ARM). The investigative report 

developed and compiled by an NCUA 

office recommending that the 

Suspending and Debarring Official 

(SDO) take a suspension or debarment 

action against a contractor. 

2. Administrative Agreement. 

Administrative Agreements are usually 

entered into in lieu of suspension or 

debarment actions. Typically the 

agreements include acceptance of 

responsibility, voluntary exclusion by 

the contractor, some provision of 

restitution, any contractor 

responsibilities with respect to codes of 

conduct, training, and the contractor’s 

promise to report progress to the NCUA, 

and generally include consequences for 

breach of the agreement. The terms of 

the Administrative Agreement and 

contents will be determined on a caseby-case basis. 

3. Administrative Record. The entire 

record of information and proceedings. 

This includes all information 

considered by the SDO that is the basis 

of the final decision. 

4. Affiliates. Business concerns, 

organizations, or individuals are 

affiliates of each other if, directly or 

indirectly, (1) either one controls or has 

the power to control the other, or (2) a 

third party controls or has the power to 

control both. Indicia of control include, 

but are not limited to, interlocking 

management or ownership, identity of 

interests among family members, shared 

facilities and equipment, common use 

of employees, or a business entity 

organized following the debarment, 

suspension, or proposed debarment of a 

contractor that has the same or similar 

management, ownership, or principal 

employees as the contractor that was 

debarred, suspended, or proposed for 

debarment. 

5. Civil Judgement. A judgement or 

finding of a civil offense by a court of 

competent jurisdiction. 

6. Contractor. Contractor means any 

individual or other legal entity that: (1) 

Directly or indirectly (for example, 

through an affiliate), submits offers for, 

or is awarded, or reasonably may be 

expected to submit offers for, or be 

awarded, a Government contract or a 

subcontract under a Government 

contract; or (2) conducts business, or 

reasonably may be expected to conduct 

business, with the Government as an 

agent or representative or another 

contractor. 

7. Debarment. A final decision made 

by the SDO to exclude a contractor from 

Government contracting and 

Government-approved subcontracting or 

covered transactions for a reasonable, 

specified period (usually not exceeding 

three years). A contractor is first 

proposed for debarment and afforded an 

opportunity to present its defenses and 

mitigating factors. 

a. Fact-Based Debarment. The cause 

for the debarment is based on factual 

circumstances (for example, history of 

poor performance or willful 

misconduct). The NCUA must be able to 

prove the action by a ‘‘preponderance of 

the evidence.’’ Preponderance of the 

evidence means that the fact(s) at issue 

are more likely than not (over 50%) to 

be true. A contractor, based upon a 

preponderance of the evidence, can be 

debarred for any of the following: 

i. Violation of the terms of a 

Government contract or subcontract so 

serious as to justify debarment, such as: 

1. Willful failure to perform in 

accordance with the terms of one or 

more contracts; or 

2. a history of failure to perform, or 

of unsatisfactory performance of, one or 

more contracts. 

ii. Violations of a Drug-Free 

Workplace, as indicated by: 

1. Failure to comply with the 

requirements of a Drug-Free Workplace; 

or 

2. such a number of contractor 

employees convicted of violations of 

criminal drug statutes occurring in the 

workplace as to indicate that the 

contractor has failed to make a good 

faith effort to provide a drug-free 

workplace.2

iii. Intentionally affixing a label 

bearing a ‘‘Made in America’’ 

inscription (or any inscription having 

the same meaning) to a product sold in 

or shipped to the United States, when 

the product was not made in the United 

States.3

iv. Commission of an unfair trade 

practice.4

v. Delinquent Federal taxes in an 

amount that exceeds $3,500. Federal 

taxes are considered delinquent for 

purposes of this provision if the tax 

liability is finally determined (i.e., 

assessed) and the taxpayer is 

delinquent in making payment. 

vi. Knowing failure by a principal, 

until 3 years after final payment on any 

Government contract awarded to the 

contractor, to timely disclose to the 


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5Title 18 U.S.C. 

6 31 U.S.C. 3729–3733. 

7Executive Order 12989, as amended by 

Executive Order 13286. 

8Section 202 of the Defense Production Act; 

Public Law 102–558. 

9 If legal proceedings are not initiated within 12 

months after the date of the suspension notice, the 

suspension shall be terminated unless an Assistant 

Attorney General requests an extension, in which 

case it may be extended for six months. 

Suspensions cannot extend beyond 18 months 

unless legal proceedings have been initiated within 

that period. The NCUA shall notify the Department 

of Justice of the proposed termination of the 

suspension, at least 30 days before the 12-month 

period expires to give the Department of Justice an 

opportunity to request an extension. 

10 41 U.S.C. chapter 81. 

11Section 202 of the Defense Production Act; 

Public Law 102–558. 

12Section 201 of the Defense Production Act; 

Public Law 102–558. 

13Title 18 U.S.C. 

14 31 U.S.C. 3729–3733. 

Government, in connection with the 

award, performance, or closeout of the 

contract or a subcontract thereunder, 

credible evidence of: 

1. Violation of Federal criminal law 

involving fraud, conflict of interest, 

bribery, or gratuity violations; 5

2. violation of the civil False Claims 

Act; 6 or 

3. significant overpayment(s) on the 

contract, other than overpayments 

resulting from contract financing 

payments. 

vii. A contractor, based on a 

determination by the Secretary of 

Homeland Security or the Attorney 

General of the United States, not in 

compliance with Immigration and 

Nationality Act employment 

provisions.7 Such determination is not 

reviewable in the debarment 

proceedings. 

viii. A contractor has miscertified its 

status as a minority- and/or womenowned business. 

ix. Any other cause of so serious or 

compelling a nature that it affects the 

present responsibility of the contractor 

or subcontractor. 

b. Conviction-Based Debarment. A 

debarment action based on a conviction 

or civil judgement. A contractor can be 

debarred for a conviction or civil 

judgement based on one or more of the 

following circumstances: 

i. Commission of fraud or a criminal 

offense in connection with (i) obtaining, 

(ii) attempting to obtain, or (iii) 

performing a public contract or 

subcontract. 

ii. Violation of Federal or State 

antitrust statutes relating to the 

submission of offers. 

iii. Commission of embezzlement, 

theft, forgery, bribery, falsification or 

destruction of records, making false 

statements, tax evasion, violating 

Federal criminal tax laws, or receiving 

stolen property. 

iv. Intentionally affixing a label 

bearing a ‘‘Made in America’’ 

inscription (or any inscription having 

the same meaning) to a product sold in 

or shipped to the United States, when 

the product was not made in the United 

States.8

v. Commission of any other offense 

indicating a lack of business integrity or 

business honesty that seriously and 

directly affects the present 

responsibility of a Government 

contractor or subcontractor. 

8. Imputation. Attributing the 

misconduct of an individual or 

organization to another individual or 

organization by virtue of the latter’s 

knowledge or implied knowledge of the 

misconduct. An agency may impute the 

basis of a suspension or debarment 

through the following relationships: 

Individual to organization; organization 

to individual; individual to individual; 

and joint ventures. 

9. Indictment. An indictment for a 

criminal offense. An information or 

other filing by competent authority 

charging a criminal offense is given the 

same effect as an indictment. 

10. Presentation of Matters in 

Opposition (PMIO). The contractor may 

submit matters in opposition to the 

suspension or proposed debarment. The 

contractor may submit matters in 

person, in writing, or through a 

representative. The contractor may also 

use a combination of those methods. 

11. Present Responsibility. A 

contractor is presently responsible if the 

contractor is ethical, honest, competent, 

and has not acted in any way that 

reveals a lack of business integrity or 

business honesty, or an inability to 

satisfactorily perform Government 

contracts. 

12. System for Award Management 

(SAM). SAM is the exclusion database 

that applies across the Executive 

Branch. SAM is an official U.S. 

Government system. 

13. Suspension. A suspension is an 

immediate, but temporary (usually 12 

months), measure imposed by the SDO, 

rendering a contractor ineligible to 

receive new Government contracts or 

subcontracts, pending the outcome of a 

legal proceeding or investigation that 

could give rise to a debarment.9

a. Adequate Evidence for Suspension. 

The NCUA must have adequate 

evidence and an immediate need to 

suspend a contractor. Adequate 

evidence is information sufficient to 

support a reasonable belief that a 

particular act or omission has occurred. 

A contractor can be suspended upon 

adequate evidence of one or more the 

following: 

i. Commission of fraud or a criminal 

offense in connection with (i) obtaining, 

(ii) attempting to obtain, or (iii) 

performing a public contract or 

subcontract. 

ii. Violation of Federal or State 

antitrust statutes relating to the 

submission of offers. 

iii. Commission of embezzlement, 

theft, forgery, bribery, falsification or 

destruction of records, making false 

statements, tax evasion, violating 

Federal criminal tax laws, or receiving 

stolen property. 

iv. Violations of a Drug-Free 

Workplace, as indicated by: 

1. Failure to comply with the 

requirements of a Drug-Free Workplace; 

or 

2. Such a number of contractor 

employees convicted of violations of 

criminal drug statutes occurring in the 

workplace as to indicate that the 

contractor has failed to make a good 

faith effort to provide a drug-free 

workplace.10

v. Intentionally affixing a label 

bearing a ‘‘Made in America’’ 

inscription (or any inscription having 

the same meaning) to a product sold in 

or shipped to the United States, when 

the product was not made in the United 

States.11

vi. Commission of an unfair trade 

practice.12

vii. Delinquent Federal taxes in an 

amount that exceeds $3,500. Federal 

taxes are considered delinquent for 

purposes of this provision if the tax 

liability is finally determined (i.e., 

assessed) and the taxpayer is 

delinquent in making payment. 

viii. Knowing failure by a principal, 

until three years after final payment on 

any Government contract awarded to 

the contractor, to timely disclose to the 

Government, in connection with the 

award, performance, or closeout of the 

contract or a subcontract thereunder, 

credible evidence of: 

1. Violation of Federal criminal law 

involving fraud, conflict of interest, 

bribery, or gratuity violations; 13

2. violation of the civil False Claims 

Act; 14 or 

3. significant overpayment(s) on the 

contract, other than overpayments 

resulting from contract financing 

payments. 

ix. Commission of any other offense 

indicating a lack of business integrity or 

business honesty that seriously and 

directly affects the present 

responsibility of a Government 

contractor or subcontractor. 


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15The nonprocurement common rule is a model 

rule published in the Federal Register and used by 

agencies to suspend, debar, or exclude contractors 

from participation in nonprocurement activities. 

Nonprocurement activities include grants, 

cooperative agreements, scholarships, fellowships, 

loans, loan guarantees, subsidiaries, insurance, 

payments for specified use, and donation 

agreements. FAR and NCR-based suspension and 

debarment actions are recognized equally by 

agencies regardless of which regulations they 

follow. 

16Also, contractors shall not enter into any 

subcontract in excess of $35,000, other than a 

subcontract for a commercially available off theshelf item, with a party that is debarred, suspended, 

or proposed for debarment. 

An indictment for any of the foregoing 

will be considered adequate evidence 

for suspension. 

D. Responsibilities 

1. NCUA Executive Director. The 

Executive Director has the authority to 

approve the award of a contract or 

subcontract to an ineligible contractor 

for compelling reasons. Decisions to 

award a contract or subcontract to 

ineligible contractors must be 

documented in writing in advance of an 

award. 

2. The Suspending and Debarring 

Official (SDO). The Deputy General 

Counsel serves as the SDO. The SDO 

decides whether to impose a suspension 

and debarment action. The decision 

whether to suspend or debar is a 

business decision and, unless mandated 

by statute or executive order, is 

discretionary. The SDO decides whether 

to send out a Notice of Suspension or 

a Notice of Proposed Debarment, issue 

a Show Cause Letter, or take no action. 

Upon commencing a formal action, the 

SDO reviews the ARM, considers any 

PMIO submitted or presented by the 

contractor, and determines whether a 

fact-finding proceeding is necessary. 

The SDO may negotiate an 

Administrative Agreement with the 

contractor. The SDO’s final decision is 

based on the ARM and the entire 

Administrative Record. 

3. Office of the General Counsel 

(OGC). OGC provides legal advice 

regarding the suspension and debarment 

program to the NCUA. OGC reviews the 

ARM, any other notices and 

correspondence, the Administrative 

Record, the SDO decision, any 

Administrative Agreement and other 

documents for legal sufficiency. OGC 

also reviews and concurs in any 

decision from the OCFO, to terminate or 

void contracts held by suspended, 

debarred, or proposed-for-debarment 

contractors. 

4. SDO Admin. The SDO Admin is a 

procurement attorney in OGC. The SDO 

Admin receives referral packages and 

coordinates with the OCFO, the SDO, 

and other interested NCUA parties. The 

SDO Admin also coordinates 

suspension and debarment actions with 

other agencies and enters ineligible 

contractors into SAM. The SDO Admin 

coordinates with the OIG, when 

necessary and appropriate. 

5. Office of the Chief Financial Officer 

(OCFO). OCFO contracting officers shall 

evaluate the responsibility of 

prospective contractors before award, to 

include checking SAM. Contracting 

officers shall also ensure contractor 

compliance with contract terms and 

conditions and shall coordinate 

appropriately with any NCUA office and 

the SDO Admin on a suspension and 

debarment action. 

6. Office of Inspector General (OIG). 

The OIG’s work may form the basis for 

a referral for suspension or debarment. 

The OIG shall raise any matters of 

concern resulting from audits, 

evaluations and investigations. Other 

NCUA offices may refer areas of concern 

to the OIG for investigation. 

7. All NCUA Offices. All NCUA 

offices must report misconduct that may 

give rise to a suspension and debarment 

action to the NCUA contracting officer 

and the SDO Admin upon any 

indication of a cause for suspending and 

debarring contractors. Situations that 

involve possible criminal or fraudulent 

activities must also be referred to the 

OIG. Along with more specific bases for 

debarments and suspensions listed in 

Section C, the following general matters 

may be grounds for suspension and 

debarment and should be referred: 

Contractor fraud, dishonesty, or 

unethical behavior; repeated or severe 

contract performance issues; 

unmitigated or undisclosed conflicts of 

interest; and improper invoicing and/or 

questionable costs. 

E. Effect of Listing 15

1. Contractors debarred, suspended, 

or proposed for debarment are excluded 

from receiving contracts, and the FAR 

provides that agencies shall not solicit 

offers from, award contracts to, or 

consent to subcontracts with these 

contractors, unless the agency head 

determines there is a compelling reason 

for such action. Subject to any 

exceptions in this policy, the NCUA 

shall not award new contracts, place 

orders exceeding the guaranteed 

minimum on indefinite delivery 

contracts, place orders under schedule 

contracts, add new work, exercise 

options, or extend the duration of a 

contract with any contractor debarred, 

suspended, or proposed for debarment. 

Except as otherwise provided in 

applicable law, a suspension and 

debarment action taken by the NCUA 

will exclude the contractor from all 

awards of other contracts within the 

Executive Branch. 

a. Current contracts. Any NCUA 

decision to terminate or void a current 

contract shall be subject to review and 

concurrence by OGC. 

b. Restrictions on subcontracting. 

When a contractor debarred, suspended 

or proposed for debarment is proposed 

as a subcontractor for any subcontract 

subject to NCUA consent, contracting 

officers shall not consent unless the 

Executive Director states in writing the 

compelling reasons to do so.16

F. Procedures for Referring Matters to 

the SDO 

1. General. The referring office shall 

provide any and all facts and 

information giving rise to the possible 

suspension and debarment, including 

any available documentation to the SDO 

Admin. Conviction-based debarment 

matters should be referred within 10 

working days of discovery and, to the 

extent practicable, all other matters 

should be referred within 30 calendar 

days. The referring office shall submit 

an ARM to the SDO Admin. The SDO 

Admin will coordinate the ARM with 

the SDO, the NCUA contracting officer 

and any other necessary party. 

2. Contents of the ARM. The ARM 

must include the following information, 

if applicable: 

a. Information on the contractor: 

i. Identity of respondents (contractors/ 

affiliates/business entities). 

ii. Position(s) held by individuals 

within the business entity. 

iii. Fictitious names or aliases. 

iv. Current mailing addresses of 

named parties and/or last known 

business address. 

v. Current telephone and fax numbers 

for named parties. 

vi. Dun and Bradstreet identifier and/ 

or the Commercial and Government 

Entity Code. 

vii. SSN and/or birthdates of 

individuals. 

viii. Listing of subsidiaries, affiliates, 

and parent companies. 

b. Pertinent Documents. 

i. NCUA-affected contract numbers 

and copies of the contract(s). 

ii. Listing of any other contracts the 

entity has with other Government 

agencies. 

iii. Invoices and other cost and 

pricing information. 

iv. Any indictment, legal documents, 

sentencing transcripts or memoranda, 

any judgement and conviction, 

settlement agreement or final order. 

v. Explanation of current business 

corporate structure, if known. 


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vi. Any business-related documents 

(articles of incorporation). 

vii. Emails and communication 

between the NCUA and the contractor. 

c. Business activity of the contractor 

and nexus statement. The ARM must 

contain a narrative explaining the 

relationship between the conduct of the 

contractor and the NCUA’s mission and/ 

or activities and include a statement of 

the grounds for suspension and 

debarment. The narrative should focus 

on the contractor’s integrity and present 

responsibility and why the NCUA needs 

protection. The narrative should show 

the SDO what happened in clear and 

concise terms. Mitigating factors that 

can be addressed are whether the 

individual(s) cooperated with any 

investigation, whether behavior was 

repetitive, and whether any individuals 

self-disclosed. Time critical events 

should be addressed (for example, 

whether the contractor is being 

considered for new award or an option 

is about to be exercised). 

d. Recommended course of action. 

The ARM shall recommend a 

suspension, proposal for debarment, or 

show cause letter. The ARM can also 

propose a period for the suspension or 

debarment. 

G. Decision-Making Process 

a. Upon receipt of a referral, the SDO 

Admin will ensure that the file has all 

of the required elements. The SDO 

Admin will coordinate with the 

referring office, the OIG, the NCUA 

contracting officer and any other 

necessary party if more information is 

needed. The SDO Admin will 

coordinate any proposed action with the 

Interagency Suspension and Debarment 

Committee (ISDC). The ISDC is an 

organization composed of suspension 

and debarment representatives from 

agencies and coordinates lead agency 

status among agencies. The lead agency 

is usually the agency with the highest 

amount of contracting dollars with the 

vendor. 

b. The SDO Admin will then forward 

the ARM to the SDO. Upon the receipt 

of a referral, the SDO will decide the 

appropriate action to take. After 

consultation with OGC, the SDO may 

take any of the following actions: 

i. Reject the ARM and take no action. 

The SDO may determine there is not 

enough evidence to initiate an action. 

The SDO will document the decision 

not to take action and tell the SDO 

Admin. The SDO Admin will 

coordinate this decision within the 

NCUA. Continuous monitoring of the 

contractor may be recommended. 

ii. Issue a Show Cause Letter. The 

SDO may issue a Show Cause Letter to 

the contractor rather than initiating a 

formal suspension or debarment action. 

The SDO Admin will send the Show 

Cause Letter to the contractor through 

USPS certified mail, return receipt 

requested, and forward a copy to the 

NCUA contracting officer and the OIG if 

necessary. The letter must include all of 

the following: 

1. A description of the alleged 

misconduct. 

2. Notice that the misconduct may 

form the basis for a suspension and 

debarment action. 

3. A request for the contractor to 

admit, deny, or explain the alleged 

misconduct. 

4. A time for a contractor to respond 

(no more than 30 calendar days from the 

date of receipt). 

5. Notice of consequences for failure 

to respond to the letter or adequately 

address the allegations of misconduct. 

iii. Issue a Notice of Suspension or 

Notice of Proposed Debarment. The 

SDO may begin formal proceedings by 

issuing a Notice of Suspension or a 

Notice of Proposed Debarment. Issuance 

of either, immediately renders the 

contractor (and any named affiliates) 

ineligible to receive Executive Branch 

contracts and the SDO Admin will enter 

the contractor’s name into SAM. Notice 

shall be sent by USPS certified mail, 

return receipt requested to the last 

known address of the contractor. 

1. Notice of Proposed Debarment. The 

notice shall inform the contractor (and 

any named affiliates): 

a. That it is being considered for 

debarment; 

b. of the reasons/causes for the 

proposed debarment; 

c. of the effect of the proposed 

debarment; 

d. of the potential effect of a 

debarment (including scope of 

ineligibility); 

e. that the contractor has 30 calendar 

days from receipt of the notice to 

respond with its PMIO in person, in 

writing, or through a representative with 

information and arguments opposing 

the proposed debarment; and 

f. that the NCUA may conduct a factfinding proceeding. 

A copy of the ARM will be sent with 

the notice. A copy of the entire 

Administrative Record will be made 

available to the contractor upon request, 

unless applicable law or parallel 

proceedings warrant the SDO’s partial 

or complete redaction or withholding of 

the Administrative Record. 

2. Notice of Suspension. The notice 

shall inform the contractor (and its 

affiliates) of the following 

circumstances: 

a. That it has been suspended; 

b. whether the suspension is based on 

indictment or other adequate evidence 

that the contractor has committed 

misconduct warranting immediate 

action; 

c. that the suspension is for a 

temporary period, pending the 

completion of an investigation (if the 

suspension is based on indictment there 

is no time limit); 

d. the cause(s) for imposing the 

suspension; 

e. the effect of the suspension 

(including the scope of ineligibility); 

f. that the contractor has 30 calendar 

days from receipt of the notice to 

respond with its PMIO in person, in 

writing, or through a representative with 

information and argument opposing the 

suspension; and 

g. that the NCUA may conduct a factfinding proceeding if the SDO finds that 

material facts are in dispute. 

A copy of the ARM will be sent with the 

notice. A copy of the entire 

Administrative Record will be made 

available to the contractor upon request, 

unless applicable law or parallel 

proceedings warrant the SDO’s partial 

or complete redaction or withholding of 

the Administrative Record. 

iv. Contractor’s PMIO. After receiving 

notice of a suspension or debarment, the 

contractor has 30 calendar days from 

receipt of the notice to respond with its 

PMIO in person, in writing, or through 

a representative with information and 

argument opposing the proposed 

suspension or debarment. There is no 

set format for how the PMIO must be 

submitted. The contractor may request a 

meeting with the SDO. The SDO will 

decide whether to transcribe meetings 

and conference calls on a case-by-case 

basis. The PMIO should raise all 

contractor defenses, contested facts, 

admissions, remedial actions taken and 

any mitigating factors. Mitigating factors 

can include explaining whether the 

contractor (a) has effective standards of 

internal control systems or adopted of 

such controls; (b) brought the 

misconduct to the attention of the 

NCUA in a timely manner; (c) internally 

investigated the misconduct; (d) 

cooperated fully with any NCUA 

investigation; (e) paid or agreed to pay 

restitution; (f) took appropriate 

disciplinary actions against individuals 

responsible for misconduct; (g) 

implemented or agreed to implement 

new remedial measures; (h) instituted or 

agreed to issue new training or ethics 

programs; (i) has had adequate time to 

eliminate the circumstances in the 

organization that led to the misconduct; 

and (j) whether management recognizes 

the seriousness of the misconduct and 

has implemented programs to prevent 


sradovich on DSK3GMQ082PROD with NOTICES
Federal Register / Vol. 83, No. 154 / Thursday, August 9, 2018 / Notices 39469 

17Parallel proceedings occur when two or more 

contemporaneous legal actions are initiated by 

different Government entities against the same 

contractor, and involving the same material facts. 

Often these arise when an agency has suspended or 

proposed a contractor for debarment and the 

Department of Justice is investigating or prosecuting 

the contractor for the same misconduct. 

recurrence. The SDO must consider all 

matters in the PMIO in rendering a final 

decision. A contractor’s failure to 

respond to the notices sent by the SDO 

shall be deemed an admission of the 

existence of the cause for suspension or 

debarment. In that case, the SDO may 

proceed to a final decision without 

further proceedings. 

A fact-finding proceeding occurs if 

actions are not based upon a conviction 

or civil judgement and when, after 

receipt of the PMIO, the SDO 

determines there is a genuine dispute 

over material fact(s). A fact-finding 

proceeding is called to consider the 

fact(s). A fact-finder can be any 

individual appointed by the SDO to 

oversee the proceeding. The contractor 

shall be afforded the opportunity to 

appear with counsel, submit 

documentary evidence and confront 

agency witnesses. The proceeding shall 

be transcribed unless otherwise 

mutually agreed upon, and the 

contractor can obtain a transcript of 

proceedings at its request and at its cost. 

The SDO shall attempt to schedule this 

proceeding within 60 calendar days of 

the PMIO. If there are numerous 

grounds for suspension and debarment, 

the proceeding can be limited to the 

grounds in dispute having a genuine 

issue of material fact. The disposition of 

the fact-finding proceeding will be 

documented by the SDO. The standard 

of proof for determining the disputed 

facts is preponderance of the evidence. 

c. Compiling the Administrative 

Record. During the process, the NCUA 

shall maintain and document all 

information considered by the SDO to 

include the ARM, the PMIO (including 

mitigating factors) and transcripts of any 

fact-finding proceedings. This is the 

Administrative Record. The following 

records, in addition to any other similar 

materials, shall also be included if 

considered by the SDO: Emails; notes; 

contract documents; newspaper articles; 

and summaries of oral briefings and 

contractor submissions. Any 

information not relied on by the SDO 

should not be included. Once the SDO 

issues a final decision, the contractor 

may request a copy of the 

Administrative Record. The SDO may 

deny the request or withhold or redact 

part of the Administrative Record if 

warranted under applicable law or 

because of parallel proceedings.17 In any 

circumstance where the SDO redacts or 

withholds all or part of the 

Administrative Record, the SDO will 

provide the reasons for doing so to the 

contractor in writing. 

d. Final Decision. The SDO shall issue 

a written final decision based on the 

Administrative Record. The SDO shall 

issue a conviction-based debarment 

within 30 working days after closing the 

Administrative Record and within 45 

working days of closing the 

Administrative Record for a fact-based 

suspension or debarment. The SDO has 

discretion to extend these deadlines. 

The Administrative Record will be 

deemed closed when the SDO Admin 

submits all evidence to the SDO for a 

final decision. The SDO Admin will 

advise the contractor in writing 

promptly after the Administrative 

Record has been closed, including the 

date it was closed. All correspondence 

shall be sent USPS certified mail, return 

receipt requested, by the SDO Admin. 

The SDO can take the following actions 

in a final decision: 

i. Not Debar the Contractor. The SDO 

may decide not to debar the contractor. 

The decision shall include, if 

applicable, referral to the Notice of 

Proposed Debarment; a summary of 

proceedings; the identities of affiliates 

or imputed conduct; and the reasons for 

not debarring (for example, an 

Administrative Agreement; mitigating 

factors; or remedial measures taken by 

the contractor). The decision shall 

notify the contractor that it may request 

a copy of the Administrative Record and 

give notice of the applicability date of 

the decision. The SDO Admin will 

remove the contractor’s name from 

SAM. 

ii. Terminate the Suspension. The 

SDO may decide to terminate the 

suspension. The decision shall include, 

if applicable, referral to the Notice of 

Suspension; a summary of proceedings; 

the identities of affiliates or imputed 

conduct; and the reason for terminating 

the Suspension (for example, an 

Administrative Agreement; mitigating 

factors; or remedial measures taken by 

the contractor). The decision shall 

notify the contractor that it may request 

a copy of the Administrative Record and 

give notice of the applicability date of 

the decision. The SDO Admin will 

remove the contractor’s name from 

SAM. 

iii. Debar the Contractor. The SDO 

may decide to debar the contractor. This 

decision must be based on the 

preponderance of the evidence. The 

decision shall include, if applicable, 

referral to the Notice of Proposed 

Debarment; a summary of proceedings; 

identities of affiliates or imputed 

conduct; the information considered by 

the SDO; the reasons for debarring; the 

scope of ineligibility; the consequences 

of debarment (application across the 

Executive Branch); and the applicability 

dates of debarment. The decision shall 

notify the contractor that it may request 

a copy of the Administrative Record. 

The SDO Admin will enter the debarred 

contractor into SAM. 

iv. Enter into an Administrative 

Agreement. At any time during the 

proceedings, the SDO may negotiate an 

Administrative Agreement with the 

contractor. An Administrative 

Agreement applies across the Executive 

Branch when entered into SAM. The 

terms of the Administrative Agreement 

and contents of the Agreement will be 

determined on a case-by-case basis. 

e. Contractor’s Remedy. After a 

decision is made, a suspended or 

debarred contractor may seek judicial 

review. OGC (in coordination with the 

Department of Justice, as appropriate or 

required) will work with the referring 

office, the SDO, and OCFO to litigate 

these claims. 

H. NCUA Action After a Decision 

If a suspension or debarment is 

imposed, NCUA offices must take steps 

to ensure the contractor does not receive 

any new contracts. Upon the 

applicability date of SAM listing, the 

NCUA must not solicit offers from, 

award contracts to, or consent to 

contracts with ineligible contractors. 

Suspended or debarred contractors may 

continue performing current contracts 

(unless those contracts are terminated or 

voided) but cannot (a) add new work, 

exercise options, or otherwise extend 

the duration of the contract or order; (b) 

issue task orders exceeding the 

guaranteed minimum under indefinite 

quantity contracts; or (c) place orders 

under blanket purchase agreements or 

basic ordering agreements. The NCUA 

must review any current contracts held 

by the contractor to determine whether 

to terminate or void those contracts. A 

decision to terminate or void a contract 

requires OGC concurrence. 

[FR Doc. 2018–17086 Filed 8–8–18; 8:45 am] 

BILLING CODE 7535–01–P 

NUCLEAR REGULATORY 

COMMISSION 

Meeting of the Advisory Committee on 

Reactor Safeguards (ACRS); 

Subcommittee on Thermal-Hydraulic 

Phenomena 

The ACRS Subcommittee on ThermalHydraulic Phenomena will hold a 

meeting on August 21, 2018, at 11545 


sradovich on DSK3GMQ082PROD with NOTICES