The level of devastation caused by Hurricanes Harvey and Irma in Texas and Florida, respectively, is estimated to have caused $150-200 billion in damages. With this devastation comes a multibillion-dollar recovery effort that will bring federal money and procurement into the affected areas. With past natural disasters as a guide, much of the work needed for short and long-term cleanup and rebuilding will be contracted to government contractors. The Robert T. Stafford Disaster Relief and Emergency Assistance Act of 1988 (Stafford Act) will help facilitate these contracts but come with unique preference requirements aimed to favor the affected communities.
Join us on Thursday, September 14, as we co-sponsor the 4th Annual Compliance & Government Investigations Update: Practical Strategies for Responding to Government Investigations and Improving Your Compliance with BDO.
This full day seminar will provide practical takeaway tips for preparing for, responding to and resolving a government investigation. Panel discussions filled with experienced counsel and government officials will deliver insight into a comprehensive list of government enforcement and compliance topics.
The afternoon sessions will feature a government contracts focused panel moderated by Todd Overman called Service Contract Act Compliance and Enforcement Trends. Sharing their insight on this informative panel will be Bass, Berry & Sims attorney Richard Arnholt and Aaron Raddock, Director, Government Contracts Advisory Services for BDO. Continue Reading Event: 4th Annual Compliance & Government Investigations Update
On Thursday, August 17, 2017, I will be in Tampa, Florida taking part in the Prime Focus Executive Event. I will present a session on the All Small Mentor-Protégé Program, highlighting the opportunities of this expanded program for both large and small businesses. During my session, I will explain how SBA-approved mentor/protégé relationships allow small businesses to benefit from significant support from large business mentors without being deemed to be affiliated. I will also offer best practices for large business mentors to enter into joint ventures with protégés and compete for work set aside for small businesses.
This program is hosted by CWU Inc. and Solvability, Inc.
As recent malware, ransomware and distributed denial of service attacks have made clear, the cyber threats posed to governments and commercial entities are real and growing. Critical infrastructure such as power plants, airports and communication systems are vulnerable to attacks on the cyber battlefield, as are banks, manufacturers, and law firms, among other commercial entities. In an attempt to address these risks, the U.S. government is imposing heightened cyber-security requirements on contractors, some of which are summarized below. But, in light of the growing cyber threats posed by nation states, subnational groups and bored teenagers, even companies that are not subject to these new requirements should evaluate the sufficiency of their current cyber security protocols and consider taking steps such as the simplified four-step “starter plan” – train, maintain, test and repeat – laid out below to address vulnerabilities.
Over the past month, we have closely monitored efforts by the U.S. Congress to tie the president’s hands over sanctions on Russia. Today, the president signed the Countering America’s Adversaries Through Sanctions Act (CAATSA or the Act), which will have a significant impact on numerous U.S. industries operating in Russia. And Russia’s response to the legislation indicates that further tensions between the United States and Russia – and possibly additional sanctions on both sides – are likely to follow.
- Penalty imposed against Exxon related to contracts with Russian oil company Rosneft
- Rosneft is not a prohibited party but its president is
- OFAC alleges that “senior-most” Exxon management were involved
- Exxon responds with suit against OFAC
On July 20, 2017, the U.S. Treasury Department Office of Foreign Assets Control (OFAC) announced that ExxonMobil (Exxon) must pay a $2 million penalty for violating U.S. sanctions on Russia. On the same day, Exxon responded by suing OFAC.
I provided insight for an article published by The New York Times on the $2 million fine that the U.S. Treasury Department charged Exxon Mobil for violating Russian sanctions. Exxon apparently entered into eight contracts with Rosneft, the Russian state oil company, signed by Rosneft CEO Igor Sechin, who is a prohibited party under U.S. sanctions on Russia. Exxon was apparently under the impression that the Rosneft CEO could sign the contracts so long as the company was not doing business with him individually. The Treasury Department’s announcement of the penalty refers to the involvement in the matter of Exxon’s “senior-most” executives, which would seem to include Rex Tillerson, who was Exxon’s CEO at the time and is now the U.S. Secretary of State. Exxon has subsequently sued the Treasury Department related to this matter.
The full article, “Stakes for Exxon in Sanctions Case Go Far Beyond a $2 Million Fine,” was published by The New York Times on July 21, 2017, and is available online.
I commented on an article published in RealClearDefense, on the impact of the April executive order highlighting the Trump administration’s intention to renew the focus on sourcing domestic resources and employees for government contracts. The order requires increased enforcement of current “Buy American” laws, which date back to the Depression-era statutes Congress passed in 1933. The Office of Management and Budget (OMB) and the Commerce Department released follow-up guidance in late June requiring all federal agencies to prepare a compliance plan by September 15, 2017.
A recent report from the Department of Defense (DoD) Inspector General (IG) identified a number of significant flaws regarding the Defense Logistics Agency’s (DLA) compliance with the Buy American Act (BAA) and the Berry Amendment. The IG’s findings will likely result in a renewed focus on both BAA and Berry Amendment compliance. As a result, contractors are likely to experience increased frustration as they seek to remain aligned with DLA policies. The IG’s report also draws further attention to the previously discussed government-wide effort by President Trump to both enhance compliance with the BAA as presently drafted and potentially strengthen the BAA through legislative action in the future.
The GAO recently denied Leidos Innovations Corporation’s protest of a determination that Leidos was ineligible to receive a $272 million award by the U.S. Army despite Leidos having both the highest-rated technical proposal and the lowest evaluated cost. The GAO decision, which affirmed the agency’s determination that Leidos was non-responsible because one of Leidos’ subcontractors did not have the necessary base access, is an important reminder that prime contractors should thoroughly vet their subcontractors to ensure, to the extent possible, all necessary qualifications are satisfied for the associated contract.