
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 10USC2408]

 
                         TITLE 10--ARMED FORCES
 
                    Subtitle A--General Military Law
 
                PART IV--SERVICE, SUPPLY, AND PROCUREMENT
 
            CHAPTER 141--MISCELLANEOUS PROCUREMENT PROVISIONS
 
Sec. 2408. Prohibition on persons convicted of defense-contract 
        related felonies and related criminal penalty on defense 
        contractors
        
    (a) Prohibition.--(1) An individual who is convicted of fraud or any 
other felony arising out of a contract with the Department of Defense 
shall be prohibited from each of the following:
        (A) Working in a management or supervisory capacity on any 
    defense contract or any first tier subcontract of a defense 
    contract.
        (B) Serving on the board of directors of any defense contractor 
    or any subcontractor awarded a contract directly by a defense 
    contractor.
        (C) Serving as a consultant to any defense contractor or any 
    subcontractor awarded a contract directly by a defense contractor.
        (D) Being involved in any other way, as determined under 
    regulations prescribed by the Secretary of Defense, with a defense 
    contract or first tier subcontract of a defense contract.

    (2) Except as provided in paragraph (3), the prohibition in 
paragraph (1) shall apply for a period, as determined by the Secretary 
of Defense, of not less than five years after the date of the 
conviction.
    (3) The prohibition in paragraph (1) may apply with respect to an 
individual for a period of less than five years if the Secretary 
determines that the five-year period should be waived in the interests 
of national security.
    (4) The prohibition in paragraph (1) does not apply with respect to 
the following:
        (A) A contract referred to in subparagraph (A), (B), (C), or (D) 
    of such paragraph that is not greater than the simplified 
    acquisition threshold (as defined in section 4(11) of the Office of 
    Federal Procurement Policy Act (41 U.S.C. 403(11))).
        (B) A contract referred to in such subparagraph that is for the 
    acquisition of commercial items (as defined in section 4(12) of the 
    Office of Federal Procurement Policy Act (41 U.S.C. 403(12))).
        (C) A subcontract referred to in such subparagraph that is under 
    a contract described in subparagraph (A) or (B).

    (b) Criminal Penalty.--A defense contractor or subcontractor shall 
be subject to a criminal penalty of not more than $500,000 if such 
contractor or subcontractor is convicted of knowingly--
        (1) employing a person under a prohibition under subsection (a); 
    or
        (2) allowing such a person to serve on the board of directors of 
    such contractor or subcontractor.

    (c) Single Point of Contact for Information.--(1) The Attorney 
General shall ensure that a single point of contact is established to 
enable a defense contractor or subcontractor to promptly obtain 
information regarding whether a person that the contractor or 
subcontractor proposes to use for an activity covered by paragraph (1) 
of subsection (a) is under a prohibition under that subsection.
    (2) The procedure for obtaining such information shall be specified 
in regulations prescribed by the Secretary of Defense under subsection 
(a).

(Added Pub. L. 99-500, Sec. 101(c) [title X, Sec. 941(a)(1)], Oct. 18, 
1986, 100 Stat. 1783-82, 1783-161, and Pub. L. 99-591, Sec. 101(c) 
[title X, Sec. 941(a)(1)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-161; 
Pub. L. 99-661, div. A, title IX, formerly title IV, Sec. 941(a)(1), 
Nov. 14, 1986, 100 Stat. 3941, renumbered title IX, Pub. L. 100-26, 
Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; amended Pub. L. 100-456, div. 
A, title VIII, Sec. 831(a), Sept. 29, 1988, 102 Stat. 2023; Pub. L. 101-
510, div. A, title VIII, Sec. 812, Nov. 5, 1990, 104 Stat. 1596; Pub. L. 
102-484, div. A, title VIII, Sec. 815(a), Oct. 23, 1992, 106 Stat. 2454; 
Pub. L. 103-355, title IV, Sec. 4102(g), title VIII, Sec. 8105(h), Oct. 
13, 1994, 108 Stat. 3340, 3393; Pub. L. 104-106, div. A, title X, 
Sec. 1062(e), Feb. 10, 1996, 110 Stat. 444.)

                          Codification

    Pub. L. 99-591 is a corrected version of Pub. L. 99-500.
    Pub. L. 99-500, Pub. L. 99-591, and Pub. L. 99-661 added identical 
sections.


                               Amendments

    1996--Subsec. (a)(3). Pub. L. 104-106 struck out at end ``If the 
five-year period is waived, the Secretary shall submit to Congress a 
report stating the reasons for the waiver.''
    1994--Subsec. (a)(4). Pub. L. 103-355, Sec. 4102(g), added 
introductory provisions and subpar. (A).
    Subsec. (a)(4)(B). Pub. L. 103-355, Sec. 8105(h)(1), added subpar. 
(B).
    Subsec. (a)(4)(C). Pub. L. 103-355, Sec. 8105(h)(2), inserted ``or 
(B)'' before period at end.
    Pub. L. 103-355, Sec. 4102(g), added subpar. (C).
    1992--Subsec. (c). Pub. L. 102-484 added subsec. (c).
    1990--Subsec. (a)(1)(A). Pub. L. 101-510, Sec. 812(a)(1), inserted 
before period at end ``or any first tier subcontract of a defense 
contract''.
    Subsec. (a)(1)(B). Pub. L. 101-510, Sec. 812(a)(2), inserted before 
period at end ``or any subcontractor awarded a contract directly by a 
defense contractor''.
    Subsec. (a)(1)(C). Pub. L. 101-510, Sec. 812(a)(3), inserted before 
period at end ``or any subcontractor awarded a contract directly by a 
defense contractor''.
    Subsec. (a)(1)(D). Pub. L. 101-510, Sec. 812(a)(4), inserted before 
period at end ``or first tier subcontract of a defense contract''.
    Subsec. (b). Pub. L. 101-510, Sec. 812(b), inserted ``or 
subcontractor'' after ``contractor'' wherever appearing.
    1988--Subsec. (a). Pub. L. 100-456 amended subsec. (a) generally. 
Prior to amendment, subsec. (a) read as follows: ``A person who is 
convicted of fraud or any other felony arising out of a contract with 
the Department of Defense shall be prohibited from working in a 
management or supervisory capacity on any defense contract, or serving 
on the board of directors of any defense contractor, for a period, as 
determined by the Secretary of Defense, of not less than one year from 
the date of the conviction.''


                    Effective Date of 1994 Amendment

    For effective date and applicability of amendment by Pub. L. 103-
355, see section 10001 of Pub. L. 103-355, set out as a note under 
section 251 of Title 41, Public Contracts.


                    Effective Date of 1988 Amendment

    Section 831(b) of Pub. L. 100-456 provided that: ``Section 2408(a) 
of title 10, United States Code, as amended by subsection (a), shall 
apply with respect to individuals convicted after the date of the 
enactment of this Act [Sept. 29, 1988].''


                             Effective Date

    Section 101(c) [title X, Sec. 941(c)] of Pub. L. 99-500 and Pub. L. 
99-591, and section 941(c) of title IX, formerly title IV, of Pub. L. 
99-661, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 
101 Stat. 273, provided that: ``Section 2408 of title 10, United States 
Code (as added by subsection (a)(1)), shall apply with respect to 
employment or service on a board of directors after the date of the 
enactment of this Act [Oct. 18, 1986].''


                  Deadline for Single Point of Contact

    Section 815(b) of Pub. L. 102-484 provided that: ``The single point 
of contact required by section 2408(c) of title 10, United States Code, 
as added by subsection (a), shall be established not later than 120 days 
after the date of the enactment of this Act [Oct. 23, 1992].''
