Government Contracting Database
Payment – Important Note
Contractors must be very careful not to certify that prior progress payments received for work performed by subcontractors, or for materials supplied by vendors, have been paid when, in fact, they have not been paid. If a contractor intends to withhold payment from a subcontractor or supplier, it must notify the government and allow the government to withhold the funds. The contractor, in other words, is not entitled to hold government funds earmarked for someone else. Violation of this provision may result in a fraud conviction and debarment.
Updated: July 24, 2018