Government Contracts, Investigations & International Trade Blog : Government Contracts Lawyer & Attorney : Sheppard Mullin Law Firm : Bids, Licenses, Awards, Conflict of Interest.

By David Gallacher 

Last month we wrote about a provision in the proposed 2013 National Defense Authorization Act (“NDAA”) that would have given the Defense Contract Audit Agency (“DCAA”) statutory authority to demand a company’s internal audit reports in order to audit the efficacy of a company’s internal business systems. Surprisingly, the authorization, as originally proposed, was modified in the final legislation. While Congress directed DCAA to issue new guidance regarding auditor access to internal audit reports, Congress stopped short of giving DCAA actual authority to demand such reports. As such, contractors will remain at loggerheads with DCAA auditors who try to exceed their statutory authority.

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By David Gallacher 

The Defense Contract Audit Agency (“DCAA”) has long sought access to contractors’ internal audit reports in connection with the routine audit of contractors’ business systems. Contractors have, in most cases, successfully resisted requests for such access on the grounds that DCAA has no statutory authority to request such documents. But that may soon change. Section 843 of the Senate version of the 2013 National Defense Authorization Act (S. 3254) would grant DCAA broad access to contractor internal audit information.

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By Peter Menard

The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Act”) became law on July 21, 2010. A primary purpose of the Act is to further incentivize whistleblowers to report potential violations of federal securities laws, including the Foreign Corrupt Practices Act (“FCPA”), to the SEC. Section 922 of the Act requires the SEC to pay whistleblowers an award, between 10-30%, for original information about a violation that leads to a successful action resulting in monetary sanctions exceeding $1 million. The Act therefore provides yet another set of liabilities for government contractors doing business internationally, and creates a whole new class of would-be private attorneys general attempting to enforce the FCPA.

For a further discussion of the Act and its implications, click here to read Sheppard Mullin partner Peter Menard's recently published article, "The Dodd Frank Act: A Guide to the Corporate Governance, Executive Compensation, and Disclosure Provisions."  This article appears in Business Law News, Published by the Business Law Section of the State Bar of California.

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By Michelle Sherman

As we discussed here last November, the United States Navy, the other military services, and the Department of Defense, have all recognized that their personnel are using social media and have responded by establishing detailed social media policies.  Similarly, there is not a shred of doubt that your company’s employees are using social media. And, just like the military services and DoD, if you’re a government contractor then you must establish a social medial policy—and it cannot be a “cookie cutter” version of standard corporate social media policies. Among other things, it must address the risk of classified information being leaked, and the ways in which your employees’ security clearances can be put in jeopardy if they are not using social media prudently.
 

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