Since its inception, SIGAR has recognized that fraud committed by contractors and other recipients of government funding has been a major threat to the success of reconstruction efforts in Afghanistan. The inability to address fraudulent conduct by individuals and organizations, whether through shoddy performance, false claims, diversion of resources, or, in many cases outright theft, puts military personnel, contractors, and their employees at risk.

The best-known remedies for fraud or other misconduct are criminal prosecution or civil litigation. These remedies are often unavailable in Afghanistan, so SIGAR also uses a lesser-known, but effective, option—suspensions and debarments.

Suspensions and debarments are actions taken by U.S. agencies to exclude companies or individuals from receiving federal contracts or assistance because of misconduct. They are important tools for ensuring that agencies award contracts only to responsible entities. SIGAR’s program addresses three challenges facing U.S. policy and contingency contracting in Afghanistan:

• The need to act quickly;
• Limited U.S. jurisdiction over Afghan nationals and Afghan companies; and
• Inherent difficulty in vetting multiple tiers of subcontractors.

SIGAR makes referrals for suspensions and debarments based on its completed investigations. In most cases, a referral is the only remedy for contractor misconduct after a contracting office fails to prosecute or take remedial action in response to an allegation. In making referrals to agencies, SIGAR provides the basis for a suspension or debarment decision, as well as supporting documentation in case the contractor challenges the decision. SIGAR has found it necessary to refer some individuals or companies on multiple occasions for misconduct or poor performance.

How it Works

SIGAR’s mission is to conduct audits and investigations of all U.S. government agencies engaged in Afghanistan reconstruction. Operating in a foreign legal jurisdiction makes that challenging. Other complications include the presence of third-country civilians, foreign corporations, NATO military and civilian personnel, nongovernmental organizations, and an active and ongoing insurgency. Criminal prosecutions and civil cases often encounter significant difficulties in developing sufficient evidence or establishing the jurisdiction required to bring a criminal or civil case in a U.S. District Court.

SIGAR initiated its suspension and debarment program because many instances of fraud were not being addressed due to lack of a means to impose criminal or civil remedies, or lack of a mechanism to ensure referral to agency suspension and debarment officials. SIGAR found, however, that recipients of government funding in Afghanistan considered the financial consequences and social stigma of being excluded from contracts, grants, and other programs to be as great or greater a punishment as criminal sanctions. In response, SIGAR developed a program to ensure that referrals for suspensions and debarments took place in a timely manner and not as afterthoughts to criminal and civil remedies.

In contingency contracting, there are often barriers between the agent or auditor gathering information on a contractor and the agency attorney assembling the case for review by the suspension and debarment official. Agencies’ agents or auditors typically have minimal contact with the attorney conducting the suspension or debarment, and the attorney has no oversight over the conduct of the investigation. This is especially true in contingency-contracting environments that are geographically remote, and where there is no preexisting relationship between the agent or auditor and the attorney. The result can be a misunderstanding about how, when, and why suspension and debarment may be applied.

SIGAR’s Suspension and Debarment Program is unique because it embeds an attorney experienced with suspensions and debarments within the Investigations Directorate to provide oversight over case development and guidance on the use of the suspensions and debarments. This integration enables them to track individuals, organizations, and companies accused of criminal activity or poor performance at an early stage of an investigation, resulting in the development of detailed referral packages.

Integration within the Investigations Directorate also allows attorneys to assess whether follow-up actions, using suspension and debarment remedies, are needed when other targets are identified during an investigation or audit. It also allows for regular travel by SIGAR suspension and debarment attorneys to Afghanistan to conduct training, provide guidance for investigations, and to meet with counterparts in the Afghan government. SIGAR’s program has another unique element: unlike other criminal investigative organizations, all of SIGAR’s investigations are required to be reviewed for potential suspension and debarment action immediately prior to closing. This maximizes the number of cases referred for suspension and debarment.

In addition, because SIGAR is not attached to an agency involved in contracting, SIGAR does not need its own suspension and debarment official. Instead, SIGAR refers all suspensions and debarments to other agencies for adjudication, resulting in a high degree of interagency coordination. This operational necessity to work with other agencies fosters information-sharing and coordination, thereby enhancing SIGAR’s program.

Agencies typically maintain their suspension and debarment function at the headquarters/management level, so there is the potential for agency interests to influence the development of a suspension or debarment case. SIGAR’s independent standing makes for referrals not affected by considerations of impacts on the agency or a particular program. The need to go outside of SIGAR for a suspension or debarment also requires that SIGAR’s referrals be of high quality with well-supported allegations.

Once it refers a case, SIGAR has no influence over the adjudication process, yet it has been remarkably successful. Not a single individual or organization has successfully appealed a suspension and debarment official’s decision on a SIGAR-referred case to federal courts.

SIGAR Protects the U.S. Taxpayer

SIGAR’s suspension and debarment program aggressively addresses misconduct in a manner not found elsewhere in the U.S. government. It thereby complements criminal prosecution and civil litigation by applying remedies to cases that would otherwise go unaddressed. SIGAR’s robust use of suspension and debarment has been recognized by the Council of Inspectors General on Integrity and Efficiency. The Council conferred a Special Act Award for Excellence in October 2014 on SIGAR’s suspension and debarment program.

SIGAR’s work in this area has also won support from leading members of Congress.

SIGAR will continue to use suspension and debarment referral opportunities to maintain the integrity of the acquisition process and protect U.S. taxpayers’ investment in Afghanistan from waste, fraud, and abuse.