At the start of the year, the U.S. Attorney’s Office for the Northern District of Ohio issued a little-noticed press release announcing a new, interagency Supply Chain Oversight and Procurement Enforcement (SCOPE) Task Force specifically targeting “large-scale supply chain and procurement fraud in government contracting.” Although the Northern District of Ohio itself is only responsible for 40 counties in Ohio (which include the cities of Cleveland, Toledo, Akron, and Youngstown), the task force may carry a broader reach given the promise that it will support the work of the Department of Homeland Security’s Government Supply Chain Investigations Unit (GSCIU).
The Department of Justice (DOJ) has relied on similar task forces through the years to prosecute federal contractors and subcontractors for antitrust crimes, cybersecurity violations, fraud under the COVID-19 relief programs, and other schemes involving misuse of government procurement, grant, and program funding. As with the GSCIU, which the Department of Homeland Security formed in June 2023 to combat counterfeit and substandard goods in the U.S. Government supply chain, the focus of this new task force is on “products entering the government supply chain.” The press release notes that the task force is especially concerned about contractors’ and subcontractors’ use of products from “prohibited sources or foreign countries of concern.”
Although the task force’s first meeting will be held in early February, the topics it has selected for that discussion provide additional insight into its initial areas of concern. In light of the fact that the task force plans to address the subjects of public health and safety, vaccine and medicine fraud, counterfeit goods, intellectual property theft, and national security in that first meeting, entities supporting the federal government in those areas should make sure they remain focused on their supply chain compliance going forward. Companies should review the supply chain-specific requirements in their federal contracts and subcontractors (e.g., FAR 52.246-26, Reporting Nonconforming Items, and FAR 52.225-13, Restrictions on Certain Foreign Purchases) to ensure that they remain aware of and in compliance with those obligations.
