WASHINGTON (CNN) — A rule that will ban security companies owned or operated by convicted felons from providing guards for federal buildings could affect about 10 percent of the companies currently providing guards, according to the Department of Homeland Security.
Currently, 46 companies provide about 14,000 security guards to protect federal facilities, DHS says. But in a draft rule published this week, DHS estimates that 10 percent — meaning four or five companies — could lose their contracts to provide security services because of it.
A Department of Homeland Security spokesman said the department does not currently know how many of the 46 security companies are owned or operated by felons. But it chose a “high” estimate to help establish the potential impact of the new rule, which Congress mandated after learning that one security company protecting government facilities was operated by a man convicted of fraud.
Officials drafting the rule “initially considered that virtually no (businesses)… would be impacted by the rule,” said DHS spokesman Brandon Alvarez-Montgomery. “However, given the fact that (the government) had no verifiable data to support this argument one way or the other… the representatives agreed that this rule may impact a few firms,” especially considering that felonies can range from violent crimes to “driving under the influence,” and can remain on a person’s record for a lifetime.
Rep. Eleanor Holmes Norton, D-District of Columbia, introduced the law after learning that a man who had served five years in prison for money laundering and fraud was the de facto owner of his wife’s security company. The man’s role came to light only after the company failed to pay some 600 guards contracted by the Federal Protective Service, the federal entity responsible for safeguarding government property.
The proposed rule would prohibit DHS from awarding contracts to security companies “owned, controlled, or operated” by individuals convicted of serious crimes. Not all felony convictions will prohibit a company from being awarded security contracts. But felonies which “cast doubt on the integrity or business ethics” of the person, or are “inconsistent with the mission of the Federal Protective Service” will block contracts.
As examples, the government cites crimes of violence, crimes involving threats to national security, bribery, obstruction of justice and tax evasion.
Under the proposed rules, companies with existing contracts and companies bidding for new contracts will have to disclose whether they are owned, controlled or operated by a convicted felon. Under certain circumstances, contract officers can still award contracts to those companies. They may consider the age of the conviction, the circumstances surrounding it, whether the person has made restitution and what measures they’ve taken to prevent further misconduct.
In recent years, the federal government has increasingly used contracts with private security companies to provide guards for federal facilities, while using a shrinking number of Federal Protective Service (FPS) employees to oversee security, conduct investigations and perform management jobs.
“Right now, contract employees outnumber FPS employees roughly 10 to 1,” said David L. Wright, president of AFGE (American Federation of Government Employees) Local 918, which represents FPS employees.
“Cases like this are a prime example of why we need a career workforce protecting our federal properties,” Wright said. “It is imperative that federal contractors be held to the same standards of ethics and financial propriety as federal employees are.”
The DHS said that while no federal regulations currently prohibit felons from bidding on federal contracts, including security contracts, the government has several mechanisms to protect the procurement process. For example, they said, contractors “must have a satisfactory record of integrity and business ethics to be awarded a contract,” Alvarez-Montgomery said. Government contracting officers must check the Excluded Parties List Systems (EPLS) to verify that a vendor is not barred from receiving federal contract awards.”
Another regulation requires vendors to certify whether they have been convicted of certain civil — but not criminal — judgments.
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