PF 2018-18 Fraudulent Activities Within the System for Award Management (SAM) Environment

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DATE:           March 27, 2018

TO:                Procurement Directors (PDs)/Heads of Contracting Activities
                      (HCAs)Contracting Officers/Contract Specialist

FROM:          Chief
                      Contract and Financial Assistance Policy Division
                      Office of Policy
                      Office of Acquisition Management

SUBJECT:     Fraudulent Activities Within the System for Award Management
                      (SAM) Environment

SUMMARY:

This Policy Flash is to advise you that instances of fraud were discovered within the System for Award Management (SAM) environment. In certain cases, individuals have used public information to impersonate legitimate entities and establish entity registrations within SAM. By impersonating legitimate entities, these individuals have redirected payments from the Government to the fraudulent entities registered in SAM. Additionally, there have been cases where these illegitimate entities have won other Government contracts allowing for the potential to provide non-authentic or counterfeit items.

The General Services Administration (GSA) has taken several actions to reduce the risk of this happening going forward. Actions include expiring suspect SAM registrations and requiring authentic entities to re-register; advising entities showing a recent bank account change to verify their registration information; and implementing measures to better verify the identity of entities registering in SAM. As an immediate measure to help ensure the credibility of those registering in the system until a long-term solution is identified, GSA will require a notarized letter identifying the authorized Entity

Administrator for the entity associated with the DUNS number before a new SAM.gov entity registration will be activated.

This means awards or any modifications to existing awards will not be able to be made to affected entities until the re-verification is completed.

While validations of SAM records happens automatically through the FPDS with contracts, there is no similar system validation for Financial Assistance awards. This underscores the importance of validating SAM records prior to making any contract or financial assistance action or award in STRIPES. DOE is working with the STRIPES Team to ensure refresh of the vendor records in STRIPES based on the March 22, 2018 SAM updates.

For more information on the process and FAQs go to https://www.gsa.gov/samupdate.

Additional information and guidance will be provided as it becomes available.

Questions concerning this policy flash should be directed to:

Debra Bouslog of Office of Acquisition Management, Systems Division - MA-625, at 202-287-1881, or at debra.bouslog@hq.doe.gov.

Richard Bonnell of the Office of Acquisition Management, Contract and Financial Assistance Division - MA-611, at 202-287-2747, or richard.bonnell@hq.doe.gov.