Scope of Proposed Rule on Self-Reporting is Expanded and Would Also Require Self-Reporting of FCA Violations and Contract Overpayments

The FAR Secretariat today published for public comment an amendment to the proposed rule (73 FR 28407, May 16, 2008) that was previously published at the request of DOJ, to require contractors to have a code of ethics and business conduct and to notify the agency’s Office of Inspector General and the Contracting Officer whenever there is a “reasonable” basis to believe there has been a violation of federal criminal law in connection with a federal contract or subcontract. The amended proposed rule no longer exempts commercial item contracts and contracts that are performed outside the United States and, again at the request of DOJ, adds a requirement that contractors also report violations of the civil False Claims Act as well as contract overpayments, with knowing failures to report such violations being an additional cause for debarment or suspension.