People often look to the past to predict the future. Thus the logic behind background checks. If you were going to hire someone, you might want to know if they have a criminal conviction or have ever been sued and lost. If you award contracts for the federal government, this might be doubly important because a contractor might have access to sensitive information. The federal government regularly performs background checks to ensure potential contractors have the ethical, technical and financial means to perform a project.
Excluded Party List System
In a 2007 report by the Government Accountability Office, government contract officers indicated that one of the first places they started when performing a background check was the Excluded Party List System. The EPLS is a web-based, publicly available database of federal contractors and persons who, by virtue of misconduct on a previous federal contract, are forbidden from receiving federal contracts for certain periods of time.
Contract officers have the ability to request criminal checks of contractors, and such checks are required for any contractor who has access to a federal information system, or who works for the Department of Justice, Department of Homeland Security and other agencies with sensitive missions.
Contract officers may conduct a survey of other persons--including customers, vendors and sub-contractors--to gauge whether a contractor is capable of performing a job. This is usually done for large contracts. The federal government also maintains a database of performance on past federal contracts known as the Federal Awardee Performance and Integrity Information System. Contract officers must take the past performance information into account when awarding a contract.
Federal procurement officers may also seek information about employees of a contractor.
At least one federal agency, NASA, has inquired about the sexual history of contractors who work in the agency's lab. In 2008, a federal judge issued an injunction banning the practice.
Federal Acquisition Regulation
Various aspects of contractor qualifications are described in the Federal Acquisition Regulation, Part 9. This lengthy document spells out the actions a contract officer may take in awarding a contract. Some agencies, such as the Department of the Navy, also have separate regulations governing their practices in addition to FAR. Other agencies, such as the Federal Aviation Administration, aren't required to follow FAR but have similar regulations.
Private companies regularly conduct background checks of potential contractors, and their practices hew closely to those of the federal government. Companies may conduct credit checks, reviews of court records and conduct reputational surveys.