Suspensions and debarments are tools that may be used at the discretion of agencies to protect the government’s interest. The FAR prescribes overall policies and procedures governing the suspension and debarment of contractors by agencies and directs agencies to establish appropriate procedures to implement them. This flexibility enables each agency to establish a suspension and debarment program suitable to its mission and structure. The FAR specifies numerous causes for suspensions and debarments, including fraud, theft, bribery, tax evasion, or lack of business integrity. (See app. II for a list of potential causes listed in the FAR.) The existence of one of these causes does not necessarily require that the party be suspended or debarred; agencies are directed to consider the seriousness of the act and any remedial measures or mitigating factors. Agencies are to establish procedures for prompt reporting, investigation, and referral to the agency suspension and debarment official. A suspension or debarment action may also include related business entities or individuals associated with the business. Parties that are suspended, proposed for debarment, or debarred are precluded from receiving new contracts, and agencies must not solicit offers from, award contracts to, or consent to subcontracts with these parties, unless an agency head determines that there is a compelling reason for such action. The NCR provides a suspension and debarment process, which is parallel to the suspension and debarment process specified by the FAR, for nonprocurement transactions, such as grants or other assistance. The FAR and NCR provide for reciprocity—that is, a suspension or debarment under either the FAR or the NCR is recognized under the other, and a party precluded from participating in federal contracts is also excluded from receiving grants, loans, and other assistance and vice versa. Suspensions and debarments apply governmentwide—one agency’s action precludes all executive agencies from doing business with the excluded party. Additionally, violations of certain statutes and regulations other than the FAR and NCR also exclude a party from specified government transactions. The prohibited behavior could involve, for example, fraudulently receiving payments under federal health care programs or violating export control regulations. These statute- and regulation-based exclusions are often mandatory, while those taken under the FAR and NCR are discretionary. Although the violations that led to the exclusions may be unrelated to federal contracts, grants or assistance, they may result in sanctions that exclude the party from some or all procurement or federal financial and nonfinancial assistance and benefits as set out in the statute or regulation. OMB provides overall direction of governmentwide procurement policies, including those on suspensions and debarments under the FAR, and has the authority to issue guidelines for nonprocurement suspensions and debarments. ISDC, established in 1986, monitors the governmentwide system of suspension and debarment. The committee consists of representatives from agencies designated by the Director of OMB. ISDC provides support to help agencies implement their suspension and debarment programs. It serves as a forum for agencies to share ideas and assists in coordinating suspension and debarment actions among agencies. To facilitate the identification of parties that have been suspended or debarred and are excluded from receiving federal contracts, certain subcontracts, and certain federal financial and nonfinancial assistance and benefits, GSA operates the web-based EPLS. The FAR requires agencies to enter information about a firm or individual that has been suspended, proposed for debarment, or debarred by the agency, including the party’s name and address, the cause for the action, the effect of the action, and the end date of the debarment action. Other exclusions are also entered into EPLS, generally by the agency with designated enforcement authority. Contracting officers are responsible for checking EPLS to ensure that they do not award contracts to these firms or individuals. In 2005, we reported that federal agencies may not be consistently identifying suspended or debarred contractors when awarding new contracts. In 2009, we found that some contractors nevertheless received federal funds during their period of ineligibility. We made recommendations for improving EPLS to enhance agencies’ confidence that they can readily identify these contractors, which GSA subsequently addressed by making system modifications. More recently, several agencies’ offices of inspector general (OIG) have reported on challenges in their agencies’ suspension and debarment programs and made recommendations to improve the programs, including developing procedures for documenting decisions and metrics for timely processing of suspension and debarment referrals. The Department of Defense (DOD) OIG recently reported that the services and DLA had an effective suspension and debarment process, but recommended that DOD develop a working group to review and improve the process for referring poorly performing contractors for potential suspensions or debarments, develop a training program to inform contracting personnel of the suspension and debarment program and the process for referring poorly performing contractors, and conduct training for contracting personnel on checking the EPLS before awarding contracts. The governmentwide database on excluded parties includes suspension or debarment actions taken under the FAR or regulations pertaining to federal grants and other financial assistance, as well as exclusions related to other laws and regulations. Over the past 5 fiscal years, about 16 percent of cases included in EPLS were suspensions or debarments, while the remaining 84 percent of cases were other exclusions based on violations of laws and regulations resulting from certain prohibited conduct. (See fig. 1.) DOD accounted for most of the suspension and debarment cases. Slightly more than half of the governmentwide suspension and debarment cases involved actions taken under the FAR. Several civilian departments and agencies had few or no such cases. For fiscal years 2006 through 2010, about 4,600 cases—about 16 percent of all cases in EPLS—involved suspension and debarment actions taken at the discretion of agencies against firms and individuals based on any of the numerous causes specified in either the FAR or NCR, such as fraud, theft, or bribery or history of failure to perform on government contracts or transactions. Such cases generally result in exclusion from all federal contracts, grants, and benefits. About 47 percent of suspension and debarment cases were based on the NCR, which covers federal grants and assistance, with the Department of Housing and Urban Development accounting for over half of these grant and assistance–related cases. The other 53 percent of suspension and debarment cases were based on causes specified in the FAR and related to federal procurements. During this same time period, about 84 percent—or about 24,000 of the approximately 29,000 total cases reported in EPLS—were other exclusions based on a determination that the parties had violated certain statutes or regulations. For example, prohibited conduct, such as health care fraud, export control violations, or drug trafficking, can result in an EPLS listing. In these types of cases, once an agency with the designated authority has determined that a party has engaged in a prohibited activity, such as fraudulently receiving payments under federal health care programs, or violating export control regulations, the law generally requires that the party be declared ineligible for specified government transactions or activities. Although most other exclusions are based on violations that are not related to federal procurements or grants, the party is excluded from some or all procurement and nonprocurement transactions as set out in the statute. As shown in table 1, HHS, Justice, and Treasury recorded the most other exclusion type cases. These cases were related to health care fraud, drug abuse, and drug-trafficking violations. As shown in table 2, the number of suspension and debarment cases related to federal procurement varied widely among departments or agencies over the last 5 fiscal years. DOD accounted for about two-thirds of all suspension and debarment cases related to federal procurements with almost 1,600 cases. Of all the agencies, almost 70 percent had fewer than 20 suspension and debarment cases related to federal procurements. Six agencies—HHS, Commerce, and the Departments of Labor, Education, and Housing and Urban Development and the Office of Personnel Management—had no such cases over the last 5 fiscal years. Of the agencies we studied, those with the most procurement-related suspension and debarment cases share common characteristics. Agencies with few or no such suspensions or debarments for the same period do not have these characteristics regardless of the agency’s volume of contracting activity. Officials at most of these agencies acknowledged that suspension and debarment is an underutilized tool at their agencies. While each agency suspension and debarment program we reviewed is unique, the four with the most suspension and debarment cases for fiscal years 2006 through 2010—DLA, Navy, GSA, and ICE—share certain characteristics. These include a dedicated suspension and debarment program with full-time staff, detailed policies and procedures, and practices that encourage an active referral process, as shown in figure 2. One of the shared traits we identified among the four most active agencies is a dedicated suspension and debarment program with full-time staff (see table 3). Officials from the four agencies stated that having dedicated staff cannot be accomplished without the specific focus and commitment of an agency’s senior officials. Other reviews of agency suspension and debarment programs also have recognized the importance of having dedicated suspension and debarment staff. For example, responding to a February 2010 OIG report, DHS reviewed its suspension and debarment practices and concluded in October 2010 that it needed to establish and fully resource the suspension and debarment function throughout the department. Additionally, in October 2009, the U.S. Agency for International Development’s Inspector General recommended that the agency consider forming a dedicated division for suspension and debarment.