; Expected Completion Date: June 30, 2022; Monetary Benefits: $0; Resolved-a - Yes or No: No; Open or Closed-b: Closed; Row 8: ; Rec. JP Morgan Chase assumes all deposits of First Republic Bank, San Francisco, CA, FDIC Releases Report Detailing Supervision of the Former Signature Bank, New York, New York, FDIC Releases Semiannual Update on Deposit Insurance Fund, FDIC Announces Retention of Financial Advisor to Assist with the Liquidation of Securities of the Former Recommendation 6: Determine the contract structure during the solicitation and award process for the procurement of a Critical Function. Management Decision: Partially Concur Corrective Actions: The FDIC currently develops a management oversight strategy to oversee all contractors based on the risk and complexity of the contract. Such an approach reduces the chances of the FDIC being overly reliant on an individual vendor. The Risk Inventory includes an assessment of impact and likelihood, and risks are prioritized and summarized into one of four risk levels: critical, significant, moderate, and low. Management does not concur with the recommendation, but alternative action meets the intent of the recommendation; or. Based upon the best practices, these processes should include the following: Procurement Risk Assessment. September 15, 2021 1 min read Keith Jones Chief Information Officer State Department The State Department and the Federal Deposit Insurance Corp. (FDIC) have adopted new approaches to. In October 2019, the FDIC changed its procurement strategy for the two contracts to two Basic Ordering Agreements (BOA)12 and included multiple service providers on the BOAs. Corrective Action: The FDIC Risk Inventory identifies risks to the FDIC achieving its mission, goals, and objectives and risks to agency operations. Nevertheless, the comprehensive nature of the risk management framework includes many FDIC functions that might be classified as critical. In response to this recommendation, the FDIC will review its risk inventory and conduct an assessment to determine if the current risk inventory sufficiently addresses the underlying risks presented in the OIGs report, irrespective of the specific use of the term critical function., Recommendation 4: Conduct a procurement risk assessment for Critical Functions during the procurement planning process, for each contract involving Critical Functions. conferences and events. The failure to establish or maintain a proper control environment jeopardizes the reasonable assurance that an entitys objectives will be achieved, and may affect the ability of an entity to maintain control of it mission and operations. No. In addition, it should be noted that the OIGs findings and recommendations on the FDICs procurement process for Critical Functions cover all such contracts and is not limited to the Blue Canopy contracts. supervises financial institutions for safety, soundness, and consumer For example, if not managed and supervised prudently, the agency may: Footnote: 1 According to FDIC Directive 1500.6, Continuity of Operations (COOP) Program (November 2019), Essential Functions are a subset of government functions that are determined to be critical activities. Challenge, Quarterly Banking Profile for Fourth Quarter 2022, Quarterly Banking Profile for Third Quarter 2022, FDIC Releases 2021 National Survey of Unbanked and Underbanked Households, Financial %PDF-1.6 % system. While the solicitation targets three vendors to join the basic ordering agreement, under which the FDIC would issue individual task orders for work needed, the agency says one of the vendors will get the bulk of the work through an initial order for Managed Services to support the FDIC IT infrastructure environment. That task order alone will be worth $250 million over five years, with extensions possible for two and a half years, which could bump the ceiling up to $375 million. In particular, the FDIC may not ensure that it has an adequate number of employees with the appropriate training, experience, and expertise to oversee the procurements of Critical Functions. Corrective Action: In addition to current practices, the FDIC plans to address this recommendation through the study and actions described in our response to Recommendation 1, and based on such actions, will assess the need for additional periodic reviews. The partnership brings new innovations, tools and technologies that will help FDIC drive operational efficiencies, control IT costs and improve the user experience. The APM and PGI require acquisition planning for contracts exceeding $1 million and require consideration and discussion of: feasible acquisition alternatives, the impact of prior acquisitions, and any related in-house effort; risks associated with the procurement, including technical, cost, and schedule risks and efforts planned or underway to reduce risk and consequences; how the oversight manager and technical monitor will oversee the project after contract award, including any reporting requirements; the level of business continuity planning necessary for the acquisition, including whether the contractors services will be necessary in time of emergency and the level of service that will be required, any maintenance and testing requirement specific to business continuity, and any requirement that the contractor participate with FDIC in joint disaster planning exercises; and. Both the Managed Security Services Provider (MSSP) and SPPS BOAs include incentives for vendors to provide superior performance. Therefore, the FDIC should have been concerned about Blue Canopys business resumption and contingency plans in regards to its ability to provide back-up or additional resources during an adverse event. Industry Standard. According to the FDICs Selection Recommendation Report titled, Security Operations Center and Computer Security Incident Response Team Services (February 2015), the Independent Government Cost Estimate was calculated based on information acquired through historical data from the prior 3 years, as well as projects anticipated over the life of the proposed contract. The Federal Deposit Insurance Corporation (FDIC) is an USDA, CFPB, and OCC used, or considered it a best practice to have, contract provisions to specify the agencys rights and the contractors obligations and responsibilities surrounding Critical Functions. [Text box Prior OIG report. Footnote: 7 The Technical Monitor is responsible for assisting the Oversight Manager in monitoring and evaluating contractor performance under an FDIC contract. For example, as noted above, the following agencies noted heightened contracting monitoring, such as: o Determine Contract Structure. %PDF-1.6 % Best practices indicate that an agency should perform periodic reviews of its controls and processes to ensure that those controls and processes are adhered to and operating as intended, and that the agency maintains control of its mission and operations.
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