The Defense Department now requires its defense contractors to post the DOD inspector general’s fraud hotline posters in common work areas. The rule took affect Sept. 16, according to a notice in the Federal Register the same day.
The DOD IG didn’t think the old rules went far enough because the Federal Acquisition Regulation allowed a contractor to not post any other agency’s hotline numbers other than those of the Homeland Security Department if the company had its own business ethics program with a means of reporting fraud or waste.
However, the DOD IG believes the FAR might be limiting the use of its own hotline. Without a poster, an employee wouldn’t know the IG’s phone number.
The rule applies to contracts and subcontracts that exceed $5 million. It does not apply to purchases of commercial items or for work that will be performed entirely outside the United States if the contract exceeds $5 million.
Hope A. Lane, CPA, leads Aronson LLC’s Government Contract Consulting Practice with over 20 years of broad-based experience in the government contracting arena. She assists clients in all areas of government contract-related financial compliance and contract administration.
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