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Suspension and debarment of soldiers: can we do it? Yes, we can

Army Lawyer, June, 2005 by Scott N. Flesch

Chief Warrant Officer Two (CW2) Sticky Fingers, an aviation maintenance officer, is the approving official for all government purchase card (IMPAC) (2) transactions by his department at Fort Irvine, California. (3) Essentially, anything sought to be purchased or procured using the IMPAC goes through CW2 Fingers for review and approval. Due in part to the operational tempo at Fort Irvine, compliance and oversight of the IMPAC program are lacking. Sensing an opportunity for supplemental income, CW2 Fingers met individually with three cardholders whom he trusted. Chief Warrant Officer Two Fingers contrived a scheme for each cardholder to purchase electronic items for personal use from stores that accepted the IMPAC. Chief Warrant Officer Two Fingers collects the items (e.g., cell phones, PDAs, digital cameras) and auctions them over the Internet. In exchange for their assistance, CW2 Fingers kicks back fifty percent of the proceeds from the sale of the goods. Before submitting a certified consolidated bill for the purchases to the Defense Finance and Accounting Service, CW2 Fingers alters and/or creates receipts to reflect otherwise legitimate purchases and prevent detection. In the two years of this ongoing conspiracy, CW2 Fingers makes $356,000 for himself and his co-conspirators.

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After an investigation by Fort Irvine's Criminal Investigation Command (CID), the government prefers charges against CW2 Fingers to include: conspiracy, failure to obey an order, larceny, and bribery. Chief Warrant Officer Two Fingers has eighteen years of active duty service and plans to work for one of several commercial vendors he established a relationship with as an approval official when he retires. (4)

Introduction

Unfortunately, abuse of government purchase cards is not uncommon in the military. (5) In fact, starting in 2001, the level of suspected fraud detected in the Military Purchase Card Program drew congressional interest and resulted in General Accounting Office (6) (GAO) (7) as well as Department of Defense (DOD) Inspector General scrutiny. (8)

In December 2003, the GAO identified fifty-one cases of fraudulent or potentially fraudulent purchases by cardholders and one hundred-twenty cases where cardholders made improper and abusive or questionable purchases. (9) Government purchase card abuse and procurement fraud have been topics of concern throughout the Department of Defense as well as other federal agencies. (10)

In the last several years, there have been numerous news articles and stories highlighting fraud investigations of corporate America and potential suspension or debarment. Some of the companies subject to investigation were: Boeing, (11) Enron, (12) Arthur Anderson, (13) WorldCom, (14) CACI, (15) and Halliburton. (16) Acquisition related wrongdoing by Soldiers, however, is not thought of in the same or a similar context. (17) Historically, the military services have treated acquisition related misconduct through the military justice system without thought of administrative remedies outside personnel actions. (18) Of course, the higher the rank of the offender, the more newsworthy the story. (19)

Take the case of Colonel (COL) Richard J. Moran. (20) While Commander of the U.S. Army Contracting Command Korea, COL Moran orchestrated a scheme of kickbacks and bribes involving hundreds of thousands of dollars in exchange for his influence in the award of millions of dollars in contracts to Korean contractors. (21) Despite being sentenced to fifty-four months in federal prison after pleading guilty, (22) COL Moran, continued to express his desire to work in the federal procurement system following his confinement because it was what he knew." (23) The Army Suspension and Debarment Official (SDO) suspended COL Moran from future contracting throughout the executive branch of the U.S. government pursuant to the Federal Acquisition Regulation (FAR) on 14 March 2003. (24) On 27 July 2004, after pleading guilty in the U.S. District Court for the Central District of California to conspiracy, (25) bribery, (26) and aiding and abetting, (27) the Army SDO debarred COL Moran for a period of twenty-five years. (28) At the time of the debarment, COL Moran was no longer on the military rolls. (29)

The military justice system is often the vehicle used to address fraud by active duty Soldiers in the procurement process. Similar to COL Moran, these Soldiers often wish to work within the acquisition system after their punishment because it is what they know. This article looks at the use of suspension and debarment as administrative remedies to protect the federal procurement system from active duty Soldiers who are "non-responsible" (30) by virtue of their misconduct in the procurement system. (31) Additionally, this article addresses the need to report such misconduct so as to trigger review by the relevant procurement fraud offices. (32)

Basis for Suspension and Debarment

Subpart 9.4 of the FAR governs the debarment, suspension, and ineligibility of "non-responsible" contractors under the federal acquisition system. (33) These administrative remedies are far-reaching and apply throughout every executive agency. (34) The procedures and regulations governing suspension and debarment of contractors are designed to protect the overall integrity of the government procurement process. Significantly, the government should not use suspension and debarment for punishing non-responsible contractors. (35)

Suspension and debarment of soldiers: can we do it? Yes, we can

Army Lawyer, June, 2005 by Scott N. Flesch

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