§ 24.610 What procedures does the Department of Housing and Urban Development use in suspension and debarment actions?
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In deciding whether to suspend or debar you, we handle the actions as informally as practicable, consistent with principles of fundamental fairness.
(a) For suspension actions, we use the procedures in this subpart and subpart G of this part.
(b) For debarment actions, we use the procedures in this subpart and subpart H of this part.
§ 24.615 How does the Department of Housing and Urban Development notify a person of a suspension or debarment action?
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(a) The suspending or debarring official sends a written notice to the last known street address, facsimile number, or e-mail address of—
(1) You or your identified counsel; or
(2) Your agent for service of process, or any of your partners, officers, directors, owners, or joint venturers.
(b) The notice is effective if sent to any of these persons.
§ 24.620 Do Federal agencies coordinate suspension and debarment actions?
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Yes, when more than one Federal agency has an interest in a suspension or debarment, the agencies may consider designating one agency as the lead agency for making the decision. Agencies are encouraged to establish methods and procedures for coordinating their suspension and debarment actions.
§ 24.625 What is the scope of a suspension or debarment?
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If you are suspended or debarred, the suspension or debarment is effective as follows:
(a) Your suspension or debarment constitutes suspension or debarment of all of your divisions and other organizational elements from all covered transactions, unless the suspension or debarment decision is limited—
(1) By its terms to one or more specifically identified individuals, divisions, or other organizational elements; or
(2) To specific types of transactions.
(b) Any affiliate of a participant may be included in a suspension or debarment action if the suspending or debarring official—
(1) Officially names the affiliate in the notice; and
(2) Gives the affiliate an opportunity to contest the action.
§ 24.630 May the Department of Housing and Urban Development impute conduct of one person to another?
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For purposes of actions taken under this rule, we may impute conduct as follows:
(a) Conduct imputed from an individual to an organization. We may impute the fraudulent, criminal, or other improper conduct of any officer, director, shareholder, partner, employee, or other individual associated with an organization, to that organization when the improper conduct occurred in connection with the individual's performance of duties for or on behalf of that organization, or with the organization's knowledge, approval or acquiescence. The organization's acceptance of the benefits derived from the conduct is evidence of knowledge, approval or acquiescence.
(b) Conduct imputed from an organization to an individual, or between individuals. We may impute the fraudulent, criminal, or other improper conduct of any organization to an individual, or from one individual to another individual, if the individual to whom the improper conduct is imputed either participated in, had knowledge of, or reason to know of the improper conduct.
(c) Conduct imputed from one organization to another organization. We may impute the fraudulent, criminal, or other improper conduct of one organization to another organization when the improper conduct occurred in connection with a partnership, joint venture, joint application, association or similar arrangement, or when the organization to whom the improper conduct is imputed has the power to direct, manage, control or influence the activities of the organization responsible for the improper conduct. Acceptance of the benefits derived from the conduct is evidence of knowledge, approval or acquiescence.
§ 24.635 May the Department of Housing and Urban Development settle a debarment or suspension action?
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Yes, we may settle a debarment or suspension action at any time if it is in the best interest of the Federal Government.
§ 24.640 May a settlement include a voluntary exclusion?
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Yes, if we enter into a settlement with you in which you agree to be excluded, it is called a voluntary exclusion and has governmentwide effect.
§ 24.645 Do other Federal agencies know if the Department of Housing and Urban Development agrees to a voluntary exclusion?
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(a) Yes, we enter information regarding a voluntary exclusion into the EPLS.
(b) Also, any agency or person may contact us to find out the details of a voluntary exclusion.
Subpart G—Suspension
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§ 24.700 When may the suspending official issue a suspension?
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Suspension is a serious action. Using the procedures of this subpart and subpart F of this part, the suspending official may impose suspension only when that official determines that—
(a) There exists an indictment for, or other adequate evidence to suspect, an offense listed under §24.800(a), or
(b) There exists adequate evidence to suspect any other cause for debarment listed under §24.800(b) through (d); and
(c) Immediate action is necessary to protect the public interest.
§ 24.705 What does the suspending official consider in issuing a suspension?
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(a) In determining the adequacy of the evidence to support the suspension, the suspending official considers how much information is available, how credible it is given the circumstances, whether or not important allegations are corroborated, and what inferences can reasonably be drawn as a result. During this assessment, the suspending official may examine the basic documents, including grants, cooperative agreements, loan authorizations, contracts, and other relevant documents.
(b) An indictment, conviction, civil judgment, or other official findings by Federal, State, or local bodies that determine factual and/or legal matters, constitutes adequate evidence for purposes of suspension actions.
(c) In deciding whether immediate action is needed to protect the public interest, the suspending official has wide discretion. For example, the suspending official may infer the necessity for immediate action to protect the public interest either from the nature of the circumstances giving rise to a cause for suspension or from potential business relationships or involvement with a program of the Federal Government.
§ 24.710 When does a suspension take effect?
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A suspension is effective when the suspending official signs the decision to suspend.
§ 24.715 What notice does the suspending official give me if I am suspended?
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After deciding to suspend you, the suspending official promptly sends you a Notice of Suspension advising you—
(a) That you have been suspended;
(b) That your suspension is based on—
(1) An indictment;
(2) A conviction;
(3) Other adequate evidence that you have committed irregularities which seriously reflect on the propriety of further Federal Government dealings with you; or
(4) Conduct of another person that has been imputed to you, or your affiliation with a suspended or debarred person;
(c) Of any other irregularities in terms sufficient to put you on notice without disclosing the Federal Government's evidence;
(d) Of the cause(s) upon which we relied under §24.700 for imposing suspension;
(e) That your suspension is for a temporary period pending the completion of an investigation or resulting legal or debarment proceedings;
(f) Of the applicable provisions of this subpart, Subpart F of this part, and any other HUD procedures governing suspension decision making; and
(g) Of the governmentwide effect of your suspension from procurement and nonprocurement programs and activities.
§ 24.720 How may I contest a suspension?
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If you as a respondent wish to contest a suspension, you or your representative must provide the suspending official with information in opposition to the suspension. You may do this orally or in writing, but any information provided orally that you consider important must also be submitted in writing for the official record.
§ 24.725 How much time do I have to contest a suspension?
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(a) As a respondent you or your representative must either send, or make arrangements to appear and present, the information and argument to the suspending official within 30 days after you receive the Notice of Suspension.
(b) We consider the notice to be received by you—
(1) When delivered, if we mail the notice to the last known street address, or five days after we send it if the letter is undeliverable;
(2) When sent, if we send the notice by facsimile or five days after we send it if the facsimile is undeliverable; or
(3) When delivered, if we send the notice by e-mail or five days after we send it if the e-mail is undeliverable.
§ 24.730 What information must I provide to the suspending official if I contest a suspension?
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(a) In addition to any information and argument in opposition, as a respondent your submission to the suspending official must identify—
(1) Specific facts that contradict the statements contained in the Notice of Suspension. A general denial is insufficient to raise a genuine dispute over facts material to the suspension;
(2) All existing, proposed, or prior exclusions under regulations implementing E.O. 12549 and all similar actions taken by Federal, state, or local agencies, including administrative agreements that affect only those agencies;
(3) All criminal and civil proceedings not included in the Notice of Suspension that grew out of facts relevant to the cause(s) stated in the notice; and
(4) All of your affiliates.
(b) If you fail to disclose this information, or provide false information, the Department of Housing and Urban Development may seek further criminal, civil or administrative action against you, as appropriate.
§ 24.735 Under what conditions do I get an additional opportunity to challenge the facts on which the suspension is based?
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(a) You as a respondent will not have an additional opportunity to challenge the facts if the suspending official determines that—
(1) Your suspension is based upon an indictment, conviction, civil judgment, or other finding by a Federal, State, or local body for which an opportunity to contest the facts was provided;
(2) Your presentation in opposition contains only general denials to information contained in the Notice of Suspension;
(3) The issues raised in your presentation in opposition to the suspension are not factual in nature, or are not material to the suspending official's initial decision to suspend, or the official's decision whether to continue the suspension; or
(4) On the basis of advice from the Department of Justice, an office of the United States Attorney, a State attorney general's office, or a State or local prosecutor's office, that substantial interests of the government in pending or contemplated legal proceedings based on the same facts as the suspension would be prejudiced by conducting fact-finding.
(b) You will have an opportunity to challenge the facts if the suspending official determines that—
(1) The conditions in paragraph (a) of this section do not exist; and
(2) Your presentation in opposition raises a genuine dispute over facts material to the suspension.
(c) If you have an opportunity to challenge disputed material facts under this section, the suspending official or designee must conduct additional proceedings to resolve those facts.
§ 24.740 Are suspension proceedings formal?
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(a) Suspension proceedings are conducted in a fair and informal manner. The suspending official may use flexible procedures to allow you to present matters in opposition. In so doing, the suspending official is not required to follow formal rules of evidence or procedure in creating an official record upon which the official will base a final suspension decision.
(b) You as a respondent or your representative must submit any documentary evidence you want the suspending official to consider.
§ 24.745 How is fact-finding conducted?
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(a) If fact-finding is conducted—
(1) You may present witnesses and other evidence, and confront any witness presented; and
(2) The fact-finder must prepare written findings of fact for the record.
(b) A transcribed record of fact-finding proceedings must be made, unless you as a respondent and the Department of Housing and Urban Development agree to waive it in advance. If you want a copy of the transcribed record, you may purchase it.
§ 24.750 What does the suspending official consider in deciding whether to continue or terminate my suspension?
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(a) The suspending official bases the decision on all information contained in the official record. The record includes—
(1) All information in support of the suspending official's initial decision to suspend you;
(2) Any further information and argument presented in support of, or opposition to, the suspension; and
(3) Any transcribed record of fact-finding proceedings.
(b) The suspending official may refer disputed material facts to another official for findings of fact. The suspending official may reject any resulting findings, in whole or in part, only after specifically determining them to be arbitrary, capricious, or clearly erroneous.
(c) The official receiving the referral for findings of fact regarding disputed material facts must be a hearing officer in all HUD suspensions.
[68 FR 66544, 66594, 66596, Nov. 26, 2003]
§ 24.755 When will I know whether the suspension is continued or terminated?
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The suspending official must make a written decision whether to continue, modify, or terminate your suspension within 45 days of closing the official record. The official record closes upon the suspending official's receipt of final submissions, information and findings of fact, if any. The suspending official may extend that period for good cause.
§ 24.760 How long may my suspension last?
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(a) If legal or debarment proceedings are initiated at the time of, or during your suspension, the suspension may continue until the conclusion of those proceedings. However, if proceedings are not initiated, a suspension may not exceed 12 months.
(b) The suspending official may extend the 12 month limit under paragraph (a) of this section for an additional 6 months if an office of a U.S. Assistant Attorney General, U.S. Attorney, or other responsible prosecuting official requests an extension in writing. In no event may a suspension exceed 18 months without initiating proceedings under paragraph (a) of this section.
(c) The suspending official must notify the appropriate officials under paragraph (b) of this section of an impending termination of a suspension at least 30 days before the 12 month period expires to allow the officials an opportunity to request an extension.
Subpart H—Debarment
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§ 24.800 What are the causes for debarment?
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We may debar a person for—
(a) Conviction of or civil judgment for—
(1) Commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public or private agreement or transaction;
(2) Violation of Federal or State antitrust statutes, including those proscribing price fixing between competitors, allocation of customers between competitors, and bid rigging;
(3) Commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, tax evasion, receiving stolen property, making false claims, or obstruction of justice; or
(4) Commission of any other offense indicating a lack of business integrity or business honesty that seriously and directly affects your present responsibility;
(b) Violation of the terms of a public agreement or transaction so serious as to affect the integrity of an agency program, such as—
(1) A willful failure to perform in accordance with the terms of one or more public agreements or transactions;
(2) A history of failure to perform or of unsatisfactory performance of one or more public agreements or transactions; or
(3) A willful violation of a statutory or regulatory provision or requirement applicable to a public agreement or transaction;
(c) Any of the following causes:
(1) A nonprocurement debarment by any Federal agency taken before October 1, 1988, or a procurement debarment by any Federal agency taken pursuant to 48 CFR part 9, subpart 9.4, before August 25, 1995;
(2) Knowingly doing business with an ineligible person, except as permitted under §24.120;
(3) Failure to pay a single substantial debt, or a number of outstanding debts (including disallowed costs and overpayments, but not including sums owed the Federal Government under the Internal Revenue Code) owed to any Federal agency or instrumentality, provided the debt is uncontested by the debtor or, if contested, provided that the debtor's legal and administrative remedies have been exhausted;
(4) Violation of a material provision of a voluntary exclusion agreement entered into under §24.640 or of any settlement of a debarment or suspension action; or
(5) Violation of the provisions of the Drug-Free Workplace Act of 1988 (41 U.S.C. 701); or
(d) Any other cause of so serious or compelling a nature that it affects your present responsibility.
§ 24.805 What notice does the debarring official give me if I am proposed for debarment?
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After consideration of the causes in §24.800 of this subpart, if the debarring official proposes to debar you, the official sends you a Notice of Proposed Debarment, pursuant to §24.615, advising you—
(a) That the debarring official is considering debarring you;
(b) Of the reasons for proposing to debar you in terms sufficient to put you on notice of the conduct or transactions upon which the proposed debarment is based;
(c) Of the cause(s) under §24.800 upon which the debarring official relied for proposing your debarment;
(d) Of the applicable provisions of this subpart, Subpart F of this part, and any other HUD procedures governing debarment; and
(e) Of the governmentwide effect of a debarment from procurement and nonprocurement programs and activities.
§ 24.810 When does a debarment take effect?
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A debarment is not effective until the debarring official issues a decision. The debarring official does not issue a decision until the respondent has had an opportunity to contest the proposed debarment.
§ 24.815 How may I contest a proposed debarment?
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If you as a respondent wish to contest a proposed debarment, you or your representative must provide the debarring official with information in opposition to the proposed debarment. You may do this orally or in writing, but any information provided orally that you consider important must also be submitted in writing for the official record.
§ 24.820 How much time do I have to contest a proposed debarment?
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(a) As a respondent you or your representative must either send, or make arrangements to appear and present, the information and argument to the debarring official within 30 days after you receive the Notice of Proposed Debarment.
(b) We consider the Notice of Proposed Debarment to be received by you—
(1) When delivered, if we mail the notice to the last known street address, or five days after we send it if the letter is undeliverable;
(2) When sent, if we send the notice by facsimile or five days after we send it if the facsimile is undeliverable; or
(3) When delivered, if we send the notice by e-mail or five days after we send it if the e-mail is undeliverable.
§ 24.825 What information must I provide to the debarring official if I contest a proposed debarment?
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(a) In addition to any information and argument in opposition, as a respondent your submission to the debarring official must identify—
(1) Specific facts that contradict the statements contained in the Notice of Proposed Debarment. Include any information about any of the factors listed in §24.860. A general denial is insufficient to raise a genuine dispute over facts material to the debarment;
(2) All existing, proposed, or prior exclusions under regulations implementing E.O. 12549 and all similar actions taken by Federal, State, or local agencies, including administrative agreements that affect only those agencies;
(3) All criminal and civil proceedings not included in the Notice of Proposed Debarment that grew out of facts relevant to the cause(s) stated in the notice; and
(4) All of your affiliates.
(b) If you fail to disclose this information, or provide false information, the Department of Housing and Urban Development may seek further criminal, civil or administrative action against you, as appropriate.
§ 24.830 Under what conditions do I get an additional opportunity to challenge the facts on which a proposed debarment is based?
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(a) You as a respondent will not have an additional opportunity to challenge the facts if the debarring official determines that—
(1) Your debarment is based upon a conviction or civil judgment;
(2) Your presentation in opposition contains only general denials to information contained in the Notice of Proposed Debarment; or
(3) The issues raised in your presentation in opposition to the proposed debarment are not factual in nature, or are not material to the debarring official's decision whether to debar.
(b) You will have an additional opportunity to challenge the facts if the debarring official determines that—
(1) The conditions in paragraph (a) of this section do not exist; and
(2) Your presentation in opposition raises a genuine dispute over facts material to the proposed debarment.
(c) If you have an opportunity to challenge disputed material facts under this section, the debarring official or designee must conduct additional proceedings to resolve those facts.
§ 24.835 Are debarment proceedings formal?
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(a) Debarment proceedings are conducted in a fair and informal manner. The debarring official may use flexible procedures to allow you as a respondent to present matters in opposition. In so doing, the debarring official is not required to follow formal rules of evidence or procedure in creating an official record upon which the official will base the decision whether to debar.
(b) You or your representative must submit any documentary evidence you want the debarring official to consider.
§ 24.840 How is fact-finding conducted?
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(a) If fact-finding is conducted—
(1) You may present witnesses and other evidence, and confront any witness presented; and
(2) The fact-finder must prepare written findings of fact for the record.
(b) A transcribed record of fact-finding proceedings must be made, unless you as a respondent and the Department of Housing and Urban Development agree to waive it in advance. If you want a copy of the transcribed record, you may purchase it.
§ 24.845 What does the debarring official consider in deciding whether to debar me?
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(a) The debarring official may debar you for any of the causes in §24.800. However, the official need not debar you even if a cause for debarment exists. The official may consider the seriousness of your acts or omissions and the mitigating or aggravating factors set forth at §24.860.
(b) The debarring official bases the decision on all information contained in the official record. The record includes—
(1) All information in support of the debarring official's proposed debarment;
(2) Any further information and argument presented in support of, or in opposition to, the proposed debarment; and
(3) Any transcribed record of fact-finding proceedings.
(c) The debarring official may refer disputed material facts to another official for findings of fact. The debarring official may reject any resultant findings, in whole or in part, only after specifically determining them to be arbitrary, capricious, or clearly erroneous.
(d) The official receiving the referral for findings of fact regarding disputed material facts must be a hearing officer in all HUD debarments.
[68 FR 66544, 66594, 66596, Nov. 26, 2003]
§ 24.850 What is the standard of proof in a debarment action?
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(a) In any debarment action, we must establish the cause for debarment by a preponderance of the evidence.
(b) If the proposed debarment is based upon a conviction or civil judgment, the standard of proof is met.
§ 24.855 Who has the burden of proof in a debarment action?
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(a) We have the burden to prove that a cause for debarment exists.
(b) Once a cause for debarment is established, you as a respondent have the burden of demonstrating to the satisfaction of the debarring official that you are presently responsible and that debarment is not necessary.
§ 24.860 What factors may influence the debarring official's decision?
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This section lists the mitigating and aggravating factors that the debarring official may consider in determining whether to debar you and the length of your debarment period. The debarring official may consider other factors if appropriate in light of the circumstances of a particular case. The existence or nonexistence of any factor, such as one of those set forth in this section, is not necessarily determinative of your present responsibility. In making a debarment decision, the debarring official may consider the following factors:
(a) The actual or potential harm or impact that results or may result from the wrongdoing.
(b) The frequency of incidents and/or duration of the wrongdoing.
(c) Whether there is a pattern or prior history of wrongdoing. For example, if you have been found by another Federal agency or a State agency to have engaged in wrongdoing similar to that found in the debarment action, the existence of this fact may be used by the debarring official in determining that you have a pattern or prior history of wrongdoing.
(d) Whether you are or have been excluded or disqualified by an agency of the Federal Government or have not been allowed to participate in State or local contracts or assistance agreements on a basis of conduct similar to one or more of the causes for debarment specified in this part.
(e) Whether you have entered into an administrative agreement with a Federal agency or a State or local government that is not governmentwide but is based on conduct similar to one or more of the causes for debarment specified in this part.
(f) Whether and to what extent you planned, initiated, or carried out the wrongdoing.
(g) Whether you have accepted responsibility for the wrongdoing and recognize the seriousness of the misconduct that led to the cause for debarment.
(h) Whether you have paid or agreed to pay all criminal, civil and administrative liabilities for the improper activity, including any investigative or administrative costs incurred by the government, and have made or agreed to make full restitution.
(i) Whether you have cooperated fully with the government agencies during the investigation and any court or administrative action. In determining the extent of cooperation, the debarring official may consider when the cooperation began and whether you disclosed all pertinent information known to you.
(j) Whether the wrongdoing was pervasive within your organization.
(k) The kind of positions held by the individuals involved in the wrongdoing.
(l) Whether your organization took appropriate corrective action or remedial measures, such as establishing ethics training and implementing programs to prevent recurrence.
(m) Whether your principals tolerated the offense.
(n) Whether you brought the activity cited as a basis for the debarment to the attention of the appropriate government agency in a timely manner.
(o) Whether you have fully investigated the circumstances surrounding the cause for debarment and, if so, made the result of the investigation available to the debarring official.
(p) Whether you had effective standards of conduct and internal control systems in place at the time the questioned conduct occurred.
(q) Whether you have taken appropriate disciplinary action against the individuals responsible for the activity which constitutes the cause for debarment.
(r) Whether you have had adequate time to eliminate the circumstances within your organization that led to the cause for the debarment.
(s) Other factors that are appropriate to the circumstances of a particular case.
§ 24.865 How long may my debarment last?
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(a) If the debarring official decides to debar you, your period of debarment will be based on the seriousness of the cause(s) upon which your debarment is based. Generally, debarment should not exceed three years. However, if circumstances warrant, the debarring official may impose a longer period of debarment.
(b) In determining the period of debarment, the debarring official may consider the factors in §24.860. If a suspension has preceded your debarment, the debarring official must consider the time you were suspended.
(c) If the debarment is for a violation of the provisions of the Drug-Free Workplace Act of 1988, your period of debarment may not exceed five years.
§ 24.870 When do I know if the debarring official debars me?
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(a) The debarring official must make a written decision whether to debar within 45 days of closing the official record. The official record closes upon the debarring official's receipt of final submissions, information and findings of fact, if any. The debarring official may extend that period for good cause.
(b) The debarring official sends you written notice, pursuant to §24.615 that the official decided, either—
(1) Not to debar you; or
(2) To debar you. In this event, the notice:
(i) Refers to the Notice of Proposed Debarment;
(ii) Specifies the reasons for your debarment;
(iii) States the period of your debarment, including the effective dates; and
(iv) Advises you that your debarment is effective for covered transactions and contracts that are subject to the Federal Acquisition Regulation (48 CFR chapter 1), throughout the executive branch of the Federal Government unless an agency head or an authorized designee grants an exception.
§ 24.875 May I ask the debarring official to reconsider a decision to debar me?
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Yes, as a debarred person you may ask the debarring official to reconsider the debarment decision or to reduce the time period or scope of the debarment. However, you must put your request in writing and support it with documentation.
§ 24.880 What factors may influence the debarring official during reconsideration?
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The debarring official may reduce or terminate your debarment based on—
(a) Newly discovered material evidence;
(b) A reversal of the conviction or civil judgment upon which your debarment was based;
(c) A bona fide change in ownership or management;
(d) Elimination of other causes for which the debarment was imposed; or
(e) Other reasons the debarring official finds appropriate.
§ 24.885 May the debarring official extend a debarment?
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(a) Yes, the debarring official may extend a debarment for an additional period, if that official determines that an extension is necessary to protect the public interest.
(b) However, the debarring official may not extend a debarment solely on the basis of the facts and circumstances upon which the initial debarment action was based.
(c) If the debarring official decides that a debarment for an additional period is necessary, the debarring official must follow the applicable procedures in this subpart, and subpart F of this part, to extend the debarment.
Subpart I—Definitions
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§ 24.900 Adequate evidence.
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Adequate evidence means information sufficient to support the reasonable belief that a particular act or omission has occurred.
§ 24.905 Affiliate.
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Persons are affiliates of each other if, directly or indirectly, either one controls or has the power to control the other or a third person controls or has the power to control both. The ways we use to determine control include, but are not limited to—
(a) Interlocking management or ownership;
(b) Identity of interests among family members;
(c) Shared facilities and equipment;
(d) Common use of employees; or
(e) A business entity which has been organized following the exclusion of a person which has the same or similar management, ownership, or principal employees as the excluded person.
§ 24.910 Agency.
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Agency means any United States executive department, military department, defense agency, or any other agency of the executive branch. Other agencies of the Federal government are not considered “agencies” for the purposes of this part unless they issue regulations adopting the governmentwide Debarment and Suspension system under Executive orders 12549 and 12689.
§ 24.915 Agent or representative.
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Agent or representative means any person who acts on behalf of, or who is authorized to commit, a participant in a covered transaction.
§ 24.920 Civil judgment.
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Civil judgment means the disposition of a civil action by any court of competent jurisdiction, whether by verdict, decision, settlement, stipulation, other disposition which creates a civil liability for the complained of wrongful acts, or a final determination of liability under the Program Fraud Civil Remedies Act of 1988 (31 U.S.C. 3801–3812).
§ 24.925 Conviction.
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Conviction means—
(a) A judgment or any other determination of guilt of a criminal offense by any court of competent jurisdiction, whether entered upon a verdict or plea, including a plea of nolo contendere; or
(b) Any other resolution that is the functional equivalent of a judgment, including probation before judgment and deferred prosecution. A disposition without the participation of the court is the functional equivalent of a judgment only if it includes an admission of guilt.
§ 24.930 Debarment.
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Debarment means an action taken by a debarring official under subpart H of this part to exclude a person from participating in covered transactions and transactions covered under the Federal Acquisition Regulation (48 CFR chapter 1). A person so excluded is debarred.
§ 24.935 Debarring official.
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(a) Debarring official means an agency official who is authorized to impose debarment. A debarring official is either—
(1) The agency head; or
(2) An official designated by the agency head.
(b) [Reserved]
§ 24.940 Disqualified.
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Disqualified means that a person is prohibited from participating in specified Federal procurement or nonprocurement transactions as required under a statute, Executive order (other than Executive Orders 12549 and 12689) or other authority. Examples of disqualifications include persons prohibited under—
(a) The Davis-Bacon Act (40 U.S.C. 276(a));
(b) The equal employment opportunity acts and Executive orders; or
(c) The Clean Air Act (42 U.S.C. 7606), Clean Water Act (33 U.S.C. 1368) and Executive Order 11738 (3 CFR, 1973 Comp., p. 799).
§ 24.945 Excluded or exclusion.
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Excluded or exclusion means—
(a) That a person or commodity is prohibited from being a participant in covered transactions, whether the person has been suspended; debarred; proposed for debarment under 48 CFR part 9, subpart 9.4; voluntarily excluded; or
(b) The act of excluding a person.
§ 24.947 Hearing officer.
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Hearing officer means an Administrative Law Judge or Board of Contract Appeals Judge authorized by HUD's Secretary or by the Secretary's designee, to conduct proceedings under this part.
[68 FR 66596, Nov. 26, 2003]
§ 24.950 Excluded Parties List System
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Excluded Parties List System (EPLS) means the list maintained and disseminated by the General Services Administration (GSA) containing the names and other information about persons who are ineligible. The EPLS system includes the printed version entitled, “List of Parties Excluded or Disqualified from Federal Procurement and Nonprocurement Programs,” so long as published.
§ 24.955 Indictment.
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Indictment means an indictment for a criminal offense. A presentment, information, or other filing by a competent authority charging a criminal offense shall be given the same effect as an indictment.
§ 24.960 Ineligible or ineligibility.
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Ineligible or ineligibility means that a person or commodity is prohibited from covered transactions because of an exclusion or disqualification.
§ 24.965 Legal proceedings.
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Legal proceedings means any criminal proceeding or any civil judicial proceeding, including a proceeding under the Program Fraud Civil Remedies Act (31 U.S.C. 3801–3812), to which the Federal Government or a State or local government or quasi-governmental authority is a party. The term also includes appeals from those proceedings.
§ 24.970 Nonprocurement transaction.
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(a) Nonprocurement transaction means any transaction, regardless of type (except procurement contracts), including, but not limited to the following:
(1) Grants.
(2) Cooperative agreements.
(3) Scholarships.
(4) Fellowships.
(5) Contracts of assistance.
(6) Loans.
(7) Loan guarantees.
(8) Subsidies.
(9) Insurances.
(10) Payments for specified uses.
(11) Donation agreements.
(b) A nonprocurement transaction at any tier does not require the transfer of Federal funds.
§ 24.975 Notice.
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Notice means a written communication served in person, sent by certified mail or its equivalent, or sent electronically by e-mail or facsimile. (See §24.615.)
§ 24.980 Participant.
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Participant means any person who submits a proposal for or who enters into a covered transaction, including an agent or representative of a participant.
§ 24.985 Person.
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Person means any individual, corporation, partnership, association, unit of government, or legal entity, however organized.
§ 24.990 Preponderance of the evidence.
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Preponderance of the evidence means proof by information that, compared with information opposing it, leads to the conclusion that the fact at issue is more probably true than not.
§ 24.995 Principal.
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Principal means—
(a) An officer, director, owner, partner, principal investigator, or other person within a participant with management or supervisory responsibilities related to a covered transaction; or
(b) A consultant or other person, whether or not employed by the participant or paid with Federal funds, who—
(1) Is in a position to handle Federal funds;
(2) Is in a position to influence or control the use of those funds; or,
(3) Occupies a technical or professional position capable of substantially influencing the development or outcome of an activity required to perform the covered transaction.
(c) A person who has a critical influence on, or substantive control over, a covered transaction, whether or not employed by the participant. Persons who have a critical influence on, or substantive control over, a covered transaction may include, but are not limited to:
(1) Loan officers;
(2) Staff appraisers and inspectors;
(3) Underwriters;
(4) Bonding companies;
(5) Borrowers under programs financed by HUD or with loans guaranteed, insured, or subsidized through HUD programs;
(6) Purchasers of properties with HUD-insured or Secretary-held mortgages;
(7) Recipients under HUD assistance agreements;
(8) Ultimate beneficiaries of HUD programs;
(9) Fee appraisers and inspectors;
(10) Real estate agents and brokers;
(11) Management and marketing agents;
(12) Accountants, consultants, investment bankers, architects, engineers, and attorneys who are in a business relationship with participants in connection with a covered transaction under a HUD program;
(13) Contractors involved in the construction or rehabilitation of properties financed by HUD, with HUD insured loans, or acquired properties, including properties held by HUD as mortgagee-in-possession;
(14) Closing agents;
(15) Turnkey developers of projects financed by or with financing insured by HUD;
(16) Title companies;
(17) Escrow agents;
(18) Project owners;
(19) Administrators of hospitals, nursing homes, and projects for the elderly financed or insured by HUD; and
(20) Developers, sellers or owners of property financed with loans insured under title I or title II of the National Housing Act.
[68 FR 66544, 66594, 66596, Nov. 26, 2003]
§ 24.1000 Respondent.
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Respondent means a person against whom an agency has initiated a debarment or suspension action.
§ 24.1005 State.
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(a) State means—
(1) Any of the states of the United States;
(2) The District of Columbia;
(3) The Commonwealth of Puerto Rico;
(4) Any territory or possession of the United States; or
(5) Any agency or instrumentality of a state.
(b) For purposes of this part, State does not include institutions of higher education, hospitals, or units of local government.
§ 24.1010 Suspending official.
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(a) Suspending official means an agency official who is authorized to impose suspension. The suspending official is either:
(1) The agency head; or
(2) An official designated by the agency head.
(b) [Reserved]
§ 24.1015 Suspension.
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Suspension is an action taken by a suspending official under subpart G of this part that immediately prohibits a person from participating in covered transactions and transactions covered under the Federal Acquisition Regulation (48 CFR chapter 1) for a temporary period, pending completion of an agency investigation and any judicial or administrative proceedings that may ensue. A person so excluded is suspended.
§ 24.1017 Ultimate beneficiaries.
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Ultimate beneficiaries of HUD programs include, but are not limited to, subsidized tenants and subsidized mortgagors, such as those assisted under Section 8 Housing Assistance Payment contracts, by Section 236 Rental Assistance, or by Rent Supplement payments.
[69 FR 53978, Sept. 3, 2004]
§ 24.1020 Voluntary exclusion or voluntarily excluded.
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(a) Voluntary exclusion means a person's agreement to be excluded under the terms of a settlement between the person and one or more agencies. Voluntary exclusion must have governmentwide effect.
(b) Voluntarily excluded means the status of a person who has agreed to a voluntary exclusion.
Subpart J—Limited Denial of Participation
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Source: 68 FR 66597, Nov. 26, 2003, unless otherwise noted.
§ 24.1100 What is a limited denial of participation?
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A limited denial of participation excludes a specific person from participating in a specific program, or programs, within a HUD field office's geographic jurisdiction, for a specific period of time. A limited denial of participation is normally issued by a HUD field office, but may be issued by a Headquarters office. The decision to impose a limited denial of participation is discretionary and in the best interests of the government.
§ 24.1105 Who may issue a limited denial of participation?
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The Secretary designates HUD officials who are authorized to impose a limited denial of participation, affecting any participant and/or their affiliates, except FHA-approved mortgagees.
§ 24.1110 When may a HUD official issue a limited denial of participation?
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(a) An authorized HUD official may issue a limited denial of participation against a person based upon adequate evidence of any of the following causes:
(1) Approval of an applicant for insurance would constitute an unsatisfactory risk;
(2) Irregularities in a person's past performance in a HUD program;
(3) Failure of a person to maintain the prerequisites of eligibility to participate in a HUD program;
(4) Failure to honor contractual obligations or to proceed in accordance with contract specifications or HUD regulations;
(5) Failure to satisfy, upon completion, the requirements of an assistance agreement or contract;
(6) Deficiencies in ongoing construction projects;
(7) Falsely certifying in connection with any HUD program, whether or not the certification was made directly to HUD;
(8) Commission of an offense listed in §24.800;
(9) Violation of any law, regulation, or procedure relating to the application for financial assistance, insurance, or guarantee, or to the performance of obligations incurred pursuant to a grant of financial assistance or pursuant to a conditional or final commitment to insure or guarantee;
(10) Making or procuring to be made any false statement for the purpose of influencing in any way an action of the Department;
(11) Imposition of a limited denial of participation by any other HUD office; or
(12) Debarment or suspension by another federal agency for any cause substantially the same as provided in §24.800.
(b) Filing of a criminal Indictment or Information shall constitute adequate evidence for the purpose of limited denial of participation actions. The Indictment or Information need not be based on offenses against HUD.
(c) Imposition of a limited denial of participation by any other HUD office shall constitute adequate evidence for a concurrent limited denial of participation. Where such a concurrent limited denial of participation is imposed, participation may be restricted on the same basis without the need for additional conference or further hearing.
(d) An affiliate or organizational element may be included in a limited denial of participation solely on the basis of its affiliation, and regardless of its knowledge of or participation in the acts providing cause for the sanction. The burden of proving that a particular affiliate or organizational element is currently responsible and not controlled by the primary sanctioned party (or by an entity that itself is controlled by the primary sanctioned party) is on the affiliate or organizational element.
§ 24.1115 When does a limited denial of participation take effect?
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A limited denial of participation is effective immediately upon issuance of the notice.
§ 24.1120 How long may a limited denial of participation last?
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A limited denial of participation may remain effective up to 12 months.
§ 24.1125 How does a limited denial of participation start?
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A limited denial of participation is made effective by providing the person, and any specifically named affiliate, with notice:
(a) That the limited denial of participation is being imposed;
(b) Of the cause(s) under §24.1110 for the sanction;
(c) Of the potential effect of the sanction, including the length of the sanction and the HUD program(s) and geographic area affected by the sanction;
(d) Of the right to request, in writing, within 30 days of receipt of the notice, a conference under §24.1130; and
(e) Of the right to contest the limited denial of participation under §24.1130.
§ 24.1130 How may I contest my limited denial of participation?
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(a) Within 30 days after receiving a notice of limited denial of participation, you may request a conference with the official who issued such notice. The conference shall be held within 15 days after the Department's receipt of the request for a conference, unless you waive this time limit. The official or designee who imposed the sanction shall preside. At the conference, you may appear with a representative and may present all relevant information and materials to the official or designee. Within 20 days after the conference, or within 20 days after any agreed upon extension of time for submission of additional materials, the official or designee shall, in writing, advise you of the decision to terminate, modify, or affirm the limited denial of participation. If all or a portion of the remaining period of exclusion is affirmed, the notice of affirmation shall advise you of the opportunity to contest the notice and request a hearing before a Departmental Hearing Officer. You have 30 days after receipt of the notice of affirmation to request this hearing. If the official or designee does not issue a decision within the 20-day period, you may contest the sanction before a Departmental Hearing Officer. Again, you have 30 days from the expiration of the 20-day period to request this hearing. If you request a hearing before the Departmental Hearing Officer, you must submit your request to the Debarment Docket Clerk, Department of Housing and Urban Development, 451 Seventh Street, SW, B–133 Portals 200, Washington DC 20410–0500.
(b) You may skip the conference with the official and you may request a hearing before a Departmental Hearing Officer. This must also be done within 30 days after receiving a notice of limited denial of participation. If you opt to have a hearing before a Departmental Hearing Officer, you must submit your request to the Debarment Docket Clerk, Department of Housing and Urban Development, 451 Seventh Street, SW, B–133 Portals 200, Washington DC 20410–0500. The hearing before the Departmental Hearing Officer is more formal than the conference before the sanctioning official described above. The hearing before the Departmental Hearing Officer will be conducted in accordance with 24 CFR part 26, subpart A. The Departmental Hearing Officer will issue findings of fact and make a recommended decision. The sanctioning official will then make a final decision as promptly as possible after the Departmental Hearing Officer recommended decision is issued. The sanctioning official may reject the recommended decision or any findings of fact, only after specifically determining the decision or any of the facts to be arbitrary or capricious or clearly erroneous.
§ 24.1135 Do federal agencies coordinate limited denial of participation actions?
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Federal agencies do not coordinate limited denial of participation actions. As stated in §24.1100, a limited denial of participation is a HUD-specific action and applies only to HUD activities.
§ 24.1140 What is the scope of a limited denial of participation?
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The scope of a limited denial of participation is as follows:
(a) A limited denial of participation generally extends only to participation in the program under which the cause arose. A limited denial of participation may, at the discretion of the authorized official, extend to other programs, initiatives, or functions within the jurisdiction of an Assistant Secretary. The authorized official, however, may determine that the sanction shall apply to all programs throughout HUD where the sanction is based on an indictment or conviction.
(b) For purposes of this subpart, participation includes receipt of any benefit or financial assistance through grants or contractual arrangements; benefits or assistance in the form of loan guarantees or insurance; and awards of procurement contracts.
(c) The sanction may be imposed for a period not to exceed 12 months, and shall be effective within the geographic jurisdiction of the office imposing it, unless the sanction is imposed by an Assistant Secretary or Deputy Assistant Secretary in which case the sanction may be imposed on either a nationwide or a more restricted basis.
§ 24.1145 May HUD impute the conduct of one person to another in a limited denial of participation?
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For purposes of determining a limited denial of participation, HUD may impute conduct as follows:
(a) Conduct imputed from an individual to an organization. HUD may impute the fraudulent, criminal, or other improper conduct of any officer, director, shareholder, partner, employee, or other individual associated with an organization, to that organization when the improper conduct occurred in connection with the individual's performance of duties for or on behalf of that organization, or with the organization's knowledge, approval, or acquiescence. The organization's acceptance of the benefits derived from the conduct is evidence of knowledge, approval, or acquiescence.
(b) Conduct imputed from an organization to an individual or between individuals. HUD may impute the fraudulent, criminal, or other improper conduct of any organization to an individual, or from one individual to another individual, if the individual to whom the improper conduct is imputed either participated in, had knowledge of, or reason to know of the improper conduct.
(c) Conduct imputed from one organization to another organization. HUD may impute the fraudulent, criminal, or other improper conduct of one organization to another organization when the improper conduct occurred in connection with a partnership, joint venture, joint application, association, or similar arrangement, or when the organization to whom the improper conduct is imputed has the power to direct, manage, control, or influence the activities of the organization responsible for the improper conduct. Acceptance of the benefits derived from the conduct is evidence of knowledge, approval, or acquiescence.
§ 24.1150 What is the effect of a suspension or debarment on a limited denial of participation?
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If you have submitted a request for a hearing pursuant to §24.1130 of this section, and you also receive, pursuant to subpart G or H of this part, a notice of proposed debarment or suspension that is based on the same transaction(s) or conduct as the limited denial of participation, as determined by the debarring or suspending official, the following rules shall apply:
(a) During the 30-day period after you receive a proposed debarment or suspension, during which you may elect to contest the debarment under §24.815, or the suspension pursuant to §24.720, all proceedings in the limited denial of participation, including discovery, are automatically stayed.
(b) If you do not contest the proposed debarment pursuant to §24.815, or the suspension pursuant to §24.720, the final imposition of the debarment or suspension shall also constitute a final decision with respect to the limited denial of participation to the extent that the debarment or suspension is based on the same transaction(s) or conduct as the limited denial of participation.
(c) If you contest the proposed debarment pursuant to §24.815, or the suspension pursuant to §24.720, then:
(1) Those parts of the limited denial of participation and the debarment or suspension based on the same transaction(s) or conduct, as determined by the debarring or suspending official, shall be immediately consolidated before the debarring or suspending official;
(2) Proceedings under the consolidated portions of the limited denial of participation shall be stayed before the hearing officer until the suspending or debarring official makes a determination as to whether the consolidated matters should be referred to a hearing officer. Such a determination must be made within 90 days of the date of the issuance of the suspension or proposed debarment, unless the suspending/debarring official extends the period for good cause.
(i) If the suspending or debarring official determines that there is a genuine dispute as to material facts regarding the consolidated matter, the entire consolidated matter will be referred to the hearing officer hearing the limited denial of participation, for additional proceedings pursuant to 24 CFR 24.750 or §24.845.
(ii) If the suspending or debarring official determines that there is no dispute as to material facts regarding the consolidated matter, jurisdiction of the hearing officer under 24 CFR part 24, subpart J, to hear those parts of the limited denial of participation based on the same transaction[s] or conduct as the debarment or suspension, as determined by the debarring or suspending official, will be transferred to the debarring or suspending official, and the hearing officer responsible for hearing the limited denial of participation shall transfer the administrative record to the debarring or suspending official.
(3) The suspending or debarring official shall hear the entire consolidated case under the procedures governing suspensions and debarments, and shall issue a final decision as to both the limited denial of participation and the suspension or debarment.
§ 24.1155 What is the effect of a limited denial of participation on a suspension or a debarment?
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The imposition of a limited denial of participation does not affect the right of the Department to suspend or debar any person under this part.
§ 24.1160 May a limited denial of participation be terminated before the term of the limited denial of participation expires?
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If the cause for the limited denial of participation is resolved before the expiration of the 12-month period, the official who imposed the sanction may terminate it.
§ 24.1165 How is a limited denial of participation reported?
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When a limited denial of participation has been made final, or the period for requesting a conference pursuant to §24.1130 has expired without receipt of such a request, the official imposing the limited denial of participation shall notify the Director of the Compliance Division in the Departmental Enforcement Center of the scope of the limited denial of participation.
Appendix to Part 24—Covered Transactions
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