Northrop Grumman Systems Corporation Agrees to Pay $5.2 Million to Settle Allegations of False Labor Charges

The Justice Department announced today that Northrop Grumman Systems Corporation (NGSC) has agreed to pay $5.2 million to resolve its alleged False Claims Act liability for falsely billing labor under contract with the United States Postal Service (USPS).  NGSC, which is headquartered in Falls Church, Virginia, provides information and technology services to commercial and government customers, including the USPS.

“Those who do business with the government must do so fairly and honestly,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division.  “The Department of Justice will seek appropriate remedies against government contractors who knowingly overcharge the government for their services.”

The settlement concerns the Enterprise Technology Services Contract (ETS Contract) between NGSC and USPS.  The ETS Contract required NGSC to provide qualified labor and management services to augment information technology services at USPS data centers around the country.  The ETS Contract began in 2009 through a predecessor entity, Northrop Grumman Information Technology Inc., which merged with NGSC in 2010. 

Under the ETS Contract, NGSC billed USPS for personnel performing information and technology services using hourly rates established for each of more than 100 labor billing categories.  The United States alleges that NGSC knowingly billed certain personnel working under the ETS Contract for which they did not have the education and/or experience identified by these categories. 

“The U.S. Postal Service manages approximately 30,000 contract actions and spends more than $13 billion on contracted supplies and services each fiscal year,” said Steven Stuller, Acting Special Agent in Charge, U.S. Postal Service Office of Inspector General.  “The Office of Inspector General supports the Postal Service by aggressively investigating allegations of misconduct within these contracts.  In this instance, we worked hand-in-hand with the Department of Justice's Civil Division to help ensure a reasonable case-related resolution.  We applaud the exceptional work by the investigative team and know it will have a positive impact on Postal Service operations.”

This matter was handled by the Civil Division’s Commercial Litigation Branch, the USPS Office of the Inspector General, and the USPS Office of General Counsel.

The claims settled by this agreement are allegations only, and there has been no determination of liability.

January 28, 2019


The Foreign Corrupt Practices Act

An Overview

The Foreign Corrupt Practices Act of 1977, as amended, 15 U.S.C. §§ 78dd-1, et seq. ("FCPA"), was enacted for the purpose of making it unlawful for certain classes of persons and entities to make payments to foreign government officials to assist in obtaining or retaining business. Specifically, the anti-bribery provisions of the FCPA prohibit the willful use of the mails or any means of instrumentality of interstate commerce corruptly in furtherance of any offer, payment, promise to pay, or authorization of the payment of money or anything of value to any person, while knowing that all or a portion of such money or thing of value will be offered, given or promised, directly or indirectly, to a foreign official to influence the foreign official in his or her official capacity, induce the foreign official to do or omit to do an act in violation of his or her lawful duty, or to secure any improper advantage in order to assist in obtaining or retaining business for or with, or directing business to, any person.

Since 1977, the anti-bribery provisions of the FCPA have applied to all U.S. persons and certain foreign issuers of securities. With the enactment of certain amendments in 1998, the anti-bribery provisions of the FCPA now also apply to foreign firms and persons who cause, directly or through agents, an act in furtherance of such a corrupt payment to take place within the territory of the United States.

The FCPA also requires companies whose securities are listed in the United States to meet its accounting provisions. See 15 U.S.C. § 78m. These accounting provisions, which were designed to operate in tandem with the anti-bribery provisions of the FCPA, require corporations covered by the provisions to (a) make and keep books and records that accurately and fairly reflect the transactions of the corporation and (b) devise and maintain an adequate system of internal accounting controls.


Report - Effects of a Changing Climate to the US Department of Defense

 Elements of Request for Report

This report responds to section 335 of the National Defense Authorization Act for Fiscal Year 2018 (Public Law 115-91). Specifically, this report provides an assessment of the significant vulnerabilities from climate-related events in order to identify high risks to mission effectiveness on installations and to operations.

This report was discussed, with staff from the House and Senate Armed Services Committees, both majority and minority, on more than one occasion. This report is organized into three primary sections:

 I.         Summary of Climate Effects and Resulting Vulnerabilities

II.        DoD Efforts to Increase Installation Resiliency & Operational Viability

III.      Conclusions

Background:

The effects of a changing climate are a national security issue with potential impacts to Department of Defense (DoD or the Department) missions, operational plans, and installations. Our 2018 National Defense Strategy prioritizes long-term strategic competition with great power competitors by focusing the Department’s efforts and resources to:

1) build a more lethal force,

2) strengthen alliances and attract new partners, and

3) reform the Department’s processes.

To achieve these goals, DoD must be able to adapt current and future operations to address the impacts of a variety of threats and conditions, including those from weather and natural events.

To that end, DoD factors in the effects of the environment into its mission planning and execution to build resilience.

For this report, the Office of the Secretary of Defense requested information and inputs from the Military Departments, Joint Staff, Geographic Combatant Commands, and other organizations.

Planning Handbook on Climate Change Installation Adaptation and Resilience

·        In January 2017, Naval Facilities Engineering Command released a handbook for use by planners in assessing climate impacts and evaluating adaptation options to consider in the existing Installation Development Plan (Master Plan) process.

The Handbook contains an extensive set of worksheets to be used in documenting the results of planners’ assessment and evaluation, including economic analyses of adaptation alternatives.

Updated United Facilities Criteria (UFCs)

·        In October 2017, DoD UFC 1-200-02, High Performance and Sustainable Building Requirements, was updated to ensure appropriate incorporation of climate-related impacts, amongst other updated/new areas.

The UFC provides minimum requirements, and guidance for planning, designing, constructing, renovating, and maintaining high performance and sustainable buildings that will enhance DoD mission capability by reducing total ownership costs.

U.S. Army Corps of Engineers (USACE) Tools – Providing support to civilian and military infrastructure projects, USACE continues to develop assessment and adaptation tools useful in adapting to risks associated with potential changing weather patterns.

DoD Directive 4715.21 – In January 2016 the Department issued Department of Defense Directive 4715.21 Climate Change Adaptation and Resilience, assigning responsibilities to many levels and DoD components for incorporating climate considerations into planning for infrastructure and operations in order to assess and manage risks associated with the impacts of a changing climate.

Jan, 21 2019


US Federal Acquisition Regulation Update (FAR) - 2019

The FAR is the primary regulation for use by all executive agencies in their acquisition of supplies and services with appropriated funds. It became effective on April 1, 1984, and is issued within applicable laws under the joint authorities of the Administrator of General Services, the Secretary of Defense, and the Administrator for the National Aeronautics and Space Administration, under the broad policy guidelines of the Administrator, Office of Federal Procurement Policy, Office of Management and Budget.

The FAR precludes agency acquisition regulations that unnecessarily repeat, paraphrase, or otherwise restate the FAR, limits agency acquisition regulations to those necessary to implement FAR policies and procedures within an agency, and provides for coordination, simplicity, and uniformity in the Federal acquisition process.

It also provides for agency and public participation in developing the FAR and agency acquisition regulation. The Federal Acquisition Regulation (FAR) includes all Federal Acquisition Circulars through 2005-101.

Beginning in fiscal year 2019, designation of Federal Acquisition Circulars was changed to reflect the fiscal year in the first four digits and the sequence of the issued circular in the last two digit.

(a) The vision for the Federal Acquisition System is to deliver on a timely basis the best value product or service to the customer, while maintaining the public’s trust and fulfilling public policy objectives. Participants in the acquisition process should work together as a team and should be empowered to make decisions within their area of responsibility.

(b) The Federal Acquisition System will-

(1) Satisfy the customer in terms of cost, quality, and timeliness of the delivered product or service by, for example-

(i) Maximizing the use of commercial products and services;

(ii) Using contractors who have a track record of successful past performance or who demonstrate a current superior ability to perform; and

(iii) Promoting competition;

(2) Minimize administrative operating costs;

(3) Conduct business with integrity, fairness, and openness; and

(4) Fulfill public policy objectives.

(c) The Acquisition Team consists of all participants in Government acquisition including not only representatives of the technical, supply, and procurement communities but also the customers they serve, and the contractors who provide the products and services.

(d) The role of each member of the Acquisition Team is to exercise personal initiative and sound business judgment in providing the best value product or service to meet the customer’s needs. In exercising initiative, Government members of the Acquisition Team may assume if a specific strategy, practice, policy or procedure is in the best interests of the Government and is not addressed in the FAR, nor prohibited by law (statute or case law), Executive order or other regulation, that the strategy, practice, policy or procedure is a permissible exercise of authority

Jan 17, 2019


President Donald Trump has signed a bill into law aimed at boosting U.S. quantum computing capabilities.

The National Quantum Initiative Act would provide up to $1.275 billion, subject to annual appropriations, to the Department of Energy, National Institute of Standards and Technology and the National Science Foundation over the next five years for research and development of quantum science and information technology. It also directs the executive branch to develop a 10-year plan to accelerate work in this field, and enhance cooperation between government, industry and academia.

Traditional computers use electrical signals to process bits in the form of 1s and 0s. Quantum computers, on the other hand, use physical photons known as “qubits” to process information, which could make them thousands of times faster than today’s supercomputers, according to experts.

Such a capability would have major implications for the military, intelligence agencies and other organizations, especially when it comes to encrypting and decrypting critical information, said Arthur Herman, a senior fellow and quantum computing expert with the Hudson Institute. That’s why it’s critical for the United States to make major investments in the technology, he noted in an interview.

“Developing the atomic bomb and then the hydrogen bomb demanded huge devotion of resources and scientific expertise and engineering skill,” he said. “The same is true with regard to quantum computers” that could be weaponized.

The United States’ biggest competitor in this field is China, he noted, which is currently outspending its great power rival about 30 to 1. The National Quantum Initiative Act could help narrow the gap, Herman said.

A version of the legislation passed the House in September. 

“With competition from abroad, America must increase and accelerate efforts to secure leadership in the quantum sector for our national security and economic prosperity,” then-Rep. Lamar Smith, R-Texas, said last year when he introduced the act.

The legislation subsequently languished in the Senate for months, creating uncertainty about whether it would be approved by Congress. However, shortly before they left Washington, D.C., for their Christmas recess, lawmakers passed the final version of the bill, H.R. 6227, and Trump signed it into law Dec. 21.

Losing the quantum computing race to Beijing would be “catastrophic” when it comes to cybersecurity, Herman said. “If the Chinese get there first and we’re not prepared to protect our most advanced weapons systems from that kind of intrusion and from that kind of penetration, then by the time we find out that we’ve lost the quantum computer race, it will be too late.”

Jan 9, 2019


Section 809 Panel

The Section 809 Panel — which has a congressional mandate to recommend changes to the way the Defense Department procures technology — released its final report Jan. 15, stating the department must put its antiquated acquisition system on a “war footing” if it is expected to keep ahead of adversaries’ technological advances. 

The third installment is the culmination of two years of work. It puts forth 58 recommendations that are added to the 40 recommendations released in volumes 1 and 2, plus one interim report. The ultimate goal of the recommendations is to create a new acquisition system that “will allow DoD to deliver and sustain technologically superior capability inside the turn of near-peer competitors and nonstate actors,” the report said.

Volume 3 repeats what many have said: that the Defense Department’s “acquisition operates within a stovepiped management structure that values strict adherence to processes and procedures over meeting the mission.” Its industrial age principles do not work in a 21st century market, it added. 

“All too often, DoD is buying yesterday’s technology for delivery tomorrow at inflated prices, rather than buying tomorrow’s technology for delivery today at competitive market prices,” it said. 

The report acknowledges that progress has been made since the panel began its work two years ago. The Army has set up its Futures Command in order to speed up modernization and focus on its core missions. The Air Force has set up innovation hubs. And some of the recommendations in the first reports have found their way into recent National Defense Authorization acts.

The report is broken into 13 sections, some of them building on Volumes 1 and 2. Those works put forth the idea that program managers should instead be considered “portfolio managers,” who have much more budget and regulatory flexibility to deliver capabilities quicker. It also broke acquisitions down into a “marketplace framework” with three categories: defense-unique items; readily available items; and readily available items that need customization to fit defense needs. Each category requires different acquisition strategies, it said.

Volume 3 further refines the marketplace framework concept and makes recommendations “that will facilitate acquiring the most up-to-date products and services in the least amount of time possible from the open, accessible marketplace, including nontraditional and other private-sector suppliers.”

Acquiring information technology warrants its own section in Volume 3, which recommends exempting the Defense Department from Title 40 of the Clinger-Cohen Act, which spells out a long list of procedures and approvals needed to acquire IT.

Jan 15, 2019


U.S. and Qatar Sign MOU Reaffirming Qatar’s Commitment to Supporting U.S. Military Activities at Al Udeid Air Base

The U.S. Department of Defense (DOD) and the Ministry of Defense of the State of Qatar signed a Memorandum of Understanding (MOU) concerning Qatar’s support of DOD activities at Al Udeid Air Base (AUAB) during the second U.S.-Qatar Strategic Dialogue in Doha, Qatar Jan. 13. 

The MOU will help promote interoperability, support regional stability, and reaffirm the U.S.-Qatar defense relationship.  It also represents a positive step towards the eventual formalization of Qatar’s commitment to support sustainment costs and future infrastructure costs at AUAB, which the State of Qatar proposed at the first U.S.-Qatar Strategic Dialogue in January 2018.  

Sheikh Mohammed bin Abdulrahman Al Thani, Deputy Prime Minister and Minister of Foreign Affairs and Michael Pompeo, U.S. Secretary of State, jointly witnessed the signing ceremony.  The Principal Director for Middle East Policy in the Office of the U.S. Secretary of Defense Ms. Jennifer Zakriski and Brigadier General Fahad al-Sulaiti, Director of the International Military Cooperation Authority, General Headquarters, Qatar Armed Forces signed the MOU on behalf of their respective governments. 

Separately, both the U.S. and Qatari delegations to the Strategic Dialogue hailed the many achievements in the bilateral military relationship in the past year, including joint exercises, U.S. ship visits to Doha, and the implementation of standard operating procedures designed to facilitate customs, immigration, and operational processes that will deepen the security and military partnership. 

Since 2003, Qatar has hosted U.S. Central Command (CENTCOM) and Special Operations Command (SOCCENT) Forward Headquarters and U.S. Air Forces Central Command (AFCENT) at AUAB, the largest U.S. military installation in the Middle East with over 11,000 U.S. and Coalition service members.  AUAB has served as the primary staging ground for most air operations in the campaign to defeat ISIS. 

The U.S. and the State of Qatar have had a longstanding and multi-faceted bilateral military relationship which is guided by shared goals to combat terrorism, deter criminality in the Arabian Gulf and promote regional security and stability. 

Jan 14, 2019


Canada–U.S. Joint Statement

Secretary of Defense James N. Mattis and Defence Minister Harjit S. Sajjan co-hosted a meeting of the top 13 nations contributing military support to the Global Coalition to Defeat-ISIS on Dec. 6, in Ottawa. 

With 79 members, the Global Coalition to Defeat ISIS is stronger than ever in its efforts to counter the ISIS threat.

Our Coalition has liberated more than 99 percent of the territory it once held, but there is still work to be done.

Today, we reaffirmed our focus on the enduring defeat of ISIS and defined our vision moving forward.

As the ISIS threat evolves globally, we will adapt.  We will leverage and employ our considerable capabilities and the experience gained in our collective fight to ensure the lasting defeat of ISIS.

We will continue to adapt and strengthen our global network to counter ISIS's own network of foreign terrorist fighters, financing and propaganda.

To do this, we have built a network to defeat a network.

Our fight against ISIS will remain challenging, but the Coalition is drawing on all elements of our power -- military, intelligence, diplomacy, economic, law enforcement and the strength of our communities.

We are confident that we will prevail in defeating ISIS.  We stand with people across the world who seek a better and safer future.

Dec 6, 2018


Readout of Secretary of Defense James N. Mattis' Meeting with Bahrain King Hamad bin Isa Al Khalifa

Pentagon Chief Spokesperson Dana W. White provided the following readout:

Secretary of Defense James N. Mattis met with Bahrain King Hamad bin Isa Al Khalifa today at the Guadaybiya Palace to reaffirm the longstanding defense relationship between the United States and Bahrain.

The leaders discussed a broad range of defense issues, the Secretary thanked his Majesty for hosting him during the IISS-chaired Manama Dialogue, and expressed deep appreciation for the support Bahrain provides the U.S. 5th Fleet in the Kingdom.

Secretary Mattis underscored Bahrain's role in helping to expose regional destabilizing activity through weapons interdiction, and reiterated the need for renewed Gulf unity as a bulwark against these shared threats.

Oct 27, 2018


Federal Corrupt Practices Act (FCPA)

 Since 1977, the anti-bribery provisions of the FCPA have applied to all U.S. persons and certain foreign issuers of securities. With the enactment of certain amendments in 1998, the anti-bribery provisions of the FCPA now also apply to foreign firms and persons who cause, directly or through agents, an act in furtherance of such a corrupt payment to take place within the territory of the United States.

Specifically, the anti-bribery provisions of the FCPA prohibit the willful use of the mails or any means of instrumentality of interstate commerce corruptly in furtherance of any offer, payment, promise to pay, or authorization of the payment of money or anything of value to any person, while knowing that all or a portion of such money or thing of value will be offered, given or promised, directly or indirectly, to a foreign official to influence the foreign official in his or her official capacity, induce the foreign official to do or omit to do an act in violation of his or her lawful duty, or to secure any improper advantage in order to assist in obtaining or retaining business for or with, or directing business to, any person.

 The basic intent of the FCPA is to avoid bribery of foreign public officials. As a US contractor working overseas you should not knowingly hire subcontractors who bribe foreign officials to break the law or help win business. Hiring subcontractors overseas, we must require the Subcontractors to sign a compliance statement, based upon our company’s compliance policies and procedures. The best practice of FCPA compliance programs is to require audit rights.

Right to Audit  

It should be noted that a company must obtain the right to audit for FCPA compliance, with any third party vendor in the supply chain. Such an audit right should be a part of a company's standard terms and conditions.

It must include a basic language, such as:  

Vendor or any third party vendor  shall permit, upon the request of and at the sole discretion of the Company, audits by independent auditors acceptable to Company, and agree that such auditors shall have full and unrestricted access to, and to conduct reviews of, all records related to the work performed for, or services or equipment provided to, Company, and to report any violation of any of the United States FCPA, UK Bribery Act or any other applicable laws and regulations, with respect to:

a.         the effectiveness of existing compliance programs and codes of conduct;

b.         the origin and legitimacy of any funds paid to Company;

c.         its books, records and accounts, or those of any of its subsidiaries, joint ventures or affiliates, related to work performed for, or services or equipment provided to, Company;

d.         all disbursements made for or on behalf of Company; and

e.         all funds received from Company in connection with work performed for, or services or equipment provided to, Company. 

 

If you need any additional information or any assistance, please feel free top contact us at info@dynamiccontractsconsultants.com or visit us at https://www.dynamiccontractsconsultants.com/