Feral Jundi

    If any legal eagles out there have anything good or bad to say about this bill, by all means speak up.  I like the intent of the bill, but I just don’t know enough about the contents to really give a good assessment. For example, does this cover sub-contractors, or are there any loopholes that would still allow companies to bribe folks in some way, shape or form?  Does it really have teeth, or is it just a minor obstacle for companies and their sub-contractors to side step? For that, I will hold judgement. –Matt

Edit: 09/17/2010- POGO has chimed in on the bill and they support it.  The IPOA has been holding a conference on the Foreign Corrupt Practices Act (FCPA), which this current bill would be reinforcing. Here is what the IPOA will be discussing at this event:

2010 Legal Conference

In 1977, Congress passed the Foreign Corrupt Practices Act to further U.S. economic policy and protect the integrity of the American business system. Over thirty years later, the U.S. Department of Justice now refers to corruption as a “national security issue” that impacts U.S. efforts in places such as Iraq and Afghanistan. Other nations, such as the United Kingdom, have recently taken a much harder line on corruption. Criminal prosecutions, of both companies and individuals, are on the rise. What do these developments mean for companies operating in contingency environments? How do you address the challenges of corruption when working in failed or weak states, and how do you stay compliant with applicable laws?

Join IPOA for a one-day conference that will look at these issues, and discuss the complex intersection of corruption, national security, and contingency contracting. The conference will include panels of experts that will discuss the FCPA and other similar anti-corruption laws, their relevance on contingency operations, and the challenges of compliance. The panels also will discuss past cases and prosecutions that demonstrate the very real nature of these challenges.

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House passes bill to debar crooked contractors

By Robert Brodsky

September 16, 2010

The House unanimously passed legislation on Wednesday requiring the federal government to debar contractors caught bribing overseas government officials to win international business.

The 2010 Overseas Contractor Reform Act that Rep. Peter Welch, D-Vt., sponsored would require agencies to debar companies and individuals found in violation of the 1977 Foreign Corrupt Practices Act, and sever their existing government contracts and grants.

An agency head could issue a waiver to avoid debarring the contractor or grantee, after notifying Congress and justifying the decision.

“Contractors that bribe foreign governments have absolutely no business profiting off the American taxpayer,” Welch said. “Those who violate the rule of law undermine not only our nation’s mission and values, but also the safety of our troops.”

The legislation was prompted by media reports last year that private security contractor Blackwater Worldwide, now known as Xe Services LLC, had authorized secret payments to Iraqi officials to prevent Iraq from revoking its license to operate in the country. Blackwater was under heavy scrutiny by the Iraqi government after guards reportedly opened fire three years ago in a crowded square, killing 17 civilians and injuring dozens more.

“This law puts contractors like Blackwater on notice that bribery and corruption simply will not be tolerated,” Welch said. Xe has not been charged with violating the FCPA.

The language of the bill, however, could offer some wiggle room for contractors charged with bribing international officials.

During the past few years some of the largest federal contractors, including BAE Systems and Halliburton, have paid multimillion-dollar settlements to resolve FCPA allegations, and they have not faced suspension or debarment, in part because of carefully crafted settlement agreements with the Justice Department that allowed them to admit wrongdoing, but not necessarily confess to bribery.

BAE, for example, admitted to conspiring to defraud the United States and making false statements about its FCPA compliance program.

The Federal Acquisition Regulation states companies can be suspended or debarred for an “offense indicating a lack of business integrity or business honesty that seriously and directly affects the present responsibility of a government contractor or subcontractor.” The FAR does not specifically mention FCPA breaches, but federal guidelines state a person or firm found in violation — or even indicted — for an FCPA offense can be banned from doing business with the government.

The bill now moves to the Senate, where there is no companion measure.

Story here.