Violations and Sanctions
Fraudulent intent and activity as defined under Military and Veterans Code (MVC) Sections 999.9(a)(1-10) and Public Contract Code (PCC) Section 10115.10(a)(1-4) are considered DVBE Program violations. Sanctions and penalties are found in MVC Section 999.9(b-c), PCC Section 10115.10(a)(5), and California Code of Regulations (CCR), Title 2, Section 1896 et seq, as follows:
- A misdemeanor punishable by imprisonment in the county jail up to six months, or fined $1000, or both
- Civil penalties of $10,000 to $30,000 (first violation) and $30,000 to $50,000 for each additional or subsequent violation
- Costs and attorney’s fees incurred by the plaintiff, awarding department, or the DGS.
- Suspension from bidding on, or participating as either a contractor, subcontractor, or supplier in any state contract or project for three to ten years (first violation). Extends suspensions for ten years for additional or subsequent violations.
- Revocation of the DVBE or SB/DVBE certification(s) for five years (first violation). Extends suspensions for ten years for additional or subsequent violations.
- The certification revocation and suspension from contracting with the state shall apply to the principals of the business and any subsequent business formed or financed by, or affiliated with one or more of those principals.
- Any person who established, or cooperate in the establishment of, or exercises control over a firm found in violation of PCC Section 101115.10(a)(1-4) inclusive, is guilty of a misdemeanor and is liable for a civil penalties of $50,000 (first violation) and $200,000 for each additional or subsequent violation.