FAR 33.209—Suspected fraudulent claims.
Plain-English Summary
FAR 33.209 addresses what a contracting officer must do when a contractor cannot support part of a claim and there is evidence that the missing support is due to a misrepresentation of fact or fraud by the contractor. The section is a referral rule, not a merits decision on the claim itself: it tells the contracting officer to stop treating the issue as an ordinary contract administration matter and instead send it to the agency official responsible for investigating fraud. In practice, this provision sits at the intersection of claims processing, documentation review, and fraud detection, and it helps ensure that potentially fraudulent conduct is handled by the proper investigative channel rather than resolved informally or solely through contract remedies. It covers the contractor’s inability to substantiate a claim, the presence of evidence suggesting misrepresentation or fraud, the contracting officer’s mandatory referral duty, and the role of the agency fraud-investigation function. For contractors, it is a warning that unsupported claim elements can trigger serious consequences beyond denial of the claim, including fraud investigation. For contracting officers, it is a safeguard requiring escalation when the facts indicate possible fraud rather than mere poor recordkeeping or a disputed entitlement issue.
Key Rules
Unsupported claim elements matter
If the contractor cannot support any part of a claim, that deficiency alone is not enough to trigger this section. The rule applies when the lack of support is tied to evidence of misrepresentation of fact or fraud.
Evidence of fraud triggers referral
When the contracting officer has evidence that the contractor’s inability to support the claim is attributable to misrepresentation or fraud, the matter must be referred. The contracting officer does not resolve the suspected fraud issue independently under this section.
Referral is mandatory
The regulation uses mandatory language: the contracting officer shall refer the matter. This means the CO has no discretion to ignore or handle the suspected fraud solely within the claims process.
Referral goes to the fraud investigator
The matter must be sent to the agency official responsible for investigating fraud, not merely to a supervisor or claims reviewer. The purpose is to ensure the allegation is handled by the proper investigative authority.
Claim adjudication and fraud review are separate
This section distinguishes between deciding whether a claim is payable and investigating whether the contractor engaged in fraud. A claim may be disputed on the merits, but suspected fraud requires a separate investigative response.
Responsibilities
Contracting Officer
Review the claim support and determine whether there is evidence that the contractor’s inability to substantiate any part of the claim is due to misrepresentation of fact or fraud. If such evidence exists, the CO must refer the matter to the agency official responsible for investigating fraud.
Contractor
Provide adequate support for claimed amounts and ensure that claim submissions are accurate and truthful. If the contractor cannot substantiate part of a claim, it risks denial of that portion and possible referral for fraud investigation if the deficiency appears tied to misrepresentation or fraud.
Agency Official Responsible for Investigating Fraud
Receive and investigate referrals involving suspected fraud or misrepresentation. This official handles the fraud inquiry outside the ordinary claims decision process.
Practical Implications
A weakly documented claim can become a fraud issue if the missing support appears intentional rather than accidental. Contractors should maintain contemporaneous records and avoid reconstructing costs or facts without reliable evidence.
Contracting officers should distinguish between ordinary insufficiency of proof and evidence of deceit. Not every unsupported claim is fraudulent, but signs of altered records, false certifications, or knowingly inflated amounts require referral.
This rule encourages early escalation when red flags appear, which can protect the government from paying improper claims and preserve investigative options.
Contractors face heightened risk if they submit claims with exaggerated, fabricated, or inconsistent supporting data. Even partial inability to support a claim can draw scrutiny if the facts suggest intentional misrepresentation.
COs should document the basis for referral carefully and avoid making final fraud determinations themselves. The key day-to-day task is recognizing when the issue has moved beyond contract administration into potential fraud investigation.
Official Regulatory Text
If the contractor is unable to support any part of the claim and there is evidence that the inability is attributable to misrepresentation of fact or to fraud on the part of the contractor, the contracting officer shall refer the matter to the agency official responsible for investigating fraud.