National 8(a) June 2012 Summer Conference GAO Investigations and - PowerPoint PPT Presentation

National 8(a) June 2012 Summer Conference GAO Investigations and 8(a) Enterprises What to Do When GAO Comes Calling Don Carney – Rick Oehler – Christine Williams Perkins Coie LLP

Perkins Coie  Offices: 18 across the United States and China, including Anchorage, Seattle and D.C.  Perkins has represented ANCs for well over 30 years  Perkins has a strong government contracts practice  Law360 Government Contracts Group of 2010  web based resources for government contractors  http://www.perkinscoie.com/government_contracts / 2

GAO Investigations Agenda  Background of GAO Investigations  GAO Investigations of ANCs  Getting Your Costs Paid By Insurance 3

GAO 101  Government Accountability Office  Formerly General Accounting Office  Independent Auditor of federal agencies and federal contractors  Led by Comptroller General  Part of the Legislative branch – created in 1921 4

GAO 101  GAO generally supports Congress in meeting its responsibilities  GAO generally helps improve the performance of the federal government and ensures its accountability  GAO does so by conducting evaluations of federal programs and investigating whether there is improper use of federal funds 5

GAO Authority  Investigate all matters related to use of public monies  Make an investigation ordered by either house of Congress or a Congressional committee with jurisdiction over revenue, appropriations or expenditures  Assist as needed a Congressional committee with jurisdiction over revenue, appropriations or expenditures 6

GAO Authority  Can evaluate performance of federal programs and investigate all matters relating to the use of federal funds  GAO has broad rights of access to federal agency information  Can subpoena records from federal agencies and contractors  Recovery Act authorized GAO to interview Federal contractor regarding Recovery Act funded transactions 7

GAO's Audit and Evaluation Work  Most GAO reviews are made in response to Congressional requests  Required to perform certain Congressional mandates  Also performs work requested by Committee Chairmen and ranking minority members  To extent possible, GAO responds to individual Congressional member requests 8

GAO's Audit and Evaluation Work  Can consolidate similar Congressional requests  Will consider whether there is a related audit or investigation  GAO declines requests based on limited resources and can refer the request to a more appropriate agency 9

Types of Questions GAO Answers  Is a federal program achieving desired results or are changes needed?  Are there better ways of accomplishing federal program objectives at lower costs?  Is a Government program being carried out in compliance with applicable law and regulations? 10

Types of Questions GAO Answers  Are government program data furnished to Congress accurate?  Do opportunities exist to eliminate waste and inefficient use of public funds?  Are funds being spent legally and is the accounting for funds accurate? 11

GAO Work Products  Oral briefings  Congressional testimony  Comments on legislation  Written reports 12

GAO Written Reports  To Congress, committees or members  Vary in format and content depending on complexity of the assignment  GAO can work with the requester to revise the assignment and methodology as necessary  Usually will provide drafts to agencies and other directly impacted parties for comment 13

GAO Written Reports  Usually 30 days to comment, but GAO can shorten this time  Will not permit an opportunity to comment if it would compromise the results of the work  The substance of these comments will be published as part of final report  Will hold an exit conference with agency officials 14

GAO Written Reports  The substance and provide these drafts to Congress  Then issues final reports, but can hold up public release of certain reports for 30 days  Upon written request, GAO will grant Members access to its audit documentation  Once a report is released, GAO will answer questions from the media 15

Office of Special Investigations (OSI)  Investigates congressional requests concerning specific allegations of federal fraud, waste and abuse or misconduct  Also conducts specific projects that require special investigative tactics  Includes senior criminal investigators  Broad authority 16

Office of Special Investigations (OSI)  Responsible for investigating alleged violations of federal criminal law and serious wrongdoing concerning federal funds, programs and activities  Typically investigates allegations of fraud, corruption, abuse, ethics violations and conflicts of interest  Conducts work in accordance with standards established by President's Council on Integrity and Efficiency (PCIE) 17

What Really Goes On  You are contacted by investigators.  Usually a team. Always be cautious.  Requested by a member of Congress.  Request has been accepted. 18

The Request Try to get the requestor(s) letter.  Did the GAO meet with the requestor(s)?  Did the request get revised?  If so, what is the true scope? 19

Internal Investigation  What is needed in this situation?  Do we need to conduct an internal investigation?  Outside counsel/in-house experience  Did the first contact give you enough information?  Can we mitigate, if wrongdoing? 20

The Team  Who is your investigative team?  What are their respective roles?  Who is your main contact?  Can you find out their experience in this area (subtle Google, review bios, etc.)? 21

The Investigation  What are the activities you contemplate?  Is there another investigation you are conducting?  What is your time frame?  When is the draft and can I see it? 22

Scope  Questions they will likely ask you:  Direct about the scope of the investigation  Who else they need to talk to about the investigation  They usually have done a pretty thorough check and have a preliminary list  Do not feel like you have to match that list  I have not seen your list, so I do not know who I could add. Can I see it? 23

Scope  Document Requests  Do you want to supply? Could there be a subpoena coming? 31 USC Title 7.  Do you have a concurrent investigation going on with another agency?  Do you need to be careful of what you disclose especially if you have a potential interference with another investigation? 24

Document Requests  Treat and track documents like in litigation  Bates No (tracking numbers)  Review documents given  Leave a trail of when the documents were supplied  Do not expect all documents to get reviewed 25

Follow Up Activities to the Meeting  Are they talking to agencies:  FOIA request to those agencies  Review contracts other applicable documents  Talk to appropriate personnel (remember attorney client privilege/internal investigation procedures)  Ascertain what other information may be relevant  Do you have a timeline and cast of characters 26

Draft Report  Always try to get a copy of the draft report  Analyze the report and methodologies  Determine if the report is accurate and reflective of the circumstances 27

Draft Report  Supply comment, if appropriate  Any comment supplied should be supported and facts verified a number of times  Credible evidence  Agency information  Statements  Timeline 28

Draft Report  If possible, do you want to meet with the agency and discuss comments?  Have your agenda/goals in mind  Second draft report?  Comment again?  Comments generally appended to the report 29

Getting Your Costs of Responding to an Investigation Paid By Insurance  Responding to an investigation can be expensive  Insurance may cover the costs of your response 30

Agenda  Investigation Costs  Potentially Applicable Insurance Policies and Coverages  Caselaw  Maximizing Your Claim for Coverage of an Investigation 31

Investigation Costs  Investigation Types  GAO  OIG, DOJ  Potential Investigation Costs  Subpoena and document production  Maintain database  Interviews / Testimony  Legal  Investigation – interviews, FOIA requests, document requests  Strategy and counseling  Contact with Government and response to Government report(s) 32

Potentially Applicable Insurance Policies and Coverages  Directors & Officers Policies  Errors and Omissions Policies  Comprehensive General Liability Policies 33

Director & Officers Policies  Who is the Insured?  Coverages:  "Direct" or "Liability"  "Reimbursement" or "Indemnity"  "Entity"  Claims Made Policies  Defense Costs Reimbursed  Defense Costs Usually Erode Limits 34