May 21, 2018

Who Are the "Key Management Personnel" for Purposes of My Company's Facility Clearance?

PilieroMazza PLLC

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PilieroMazza PLLC

Whether a federal contractor can be cleared depends on its people. Specifically, whether a company can obtain a facility clearance (“FCL”) depends on the personnel clearances (“PCL”) of the company’s Key Management Personnel (“KMP”).

For instance, if a company needs a secret FCL for contract performance, then the company’s KMP either need to have a secret PCL or be excluded from access to classified information. Contractors often ask who the KMP for their companies are supposed to be. At a minimum, the Senior Management Official, Facility Security Officer (“FSO”), and Insider Threat Program Senior Official (“ITPSO”) must always possess a PCL to the level of the FCL. Other officials and owners must be cleared or be excluded from classified access. Who those other officials and owners are depends on how your company is legally structured:

Corporation

Chairman of the Board
Senior Management Official (e.g., chief executive officer, president)
FSO
ITPSO

LLC

Senior Management Official
FSO
ITPSO
Members/Managers of LLC

Partnership

All general partners (unless there is a designated managing partner and/or executive committee)
All executive committee members
Senior Management Official (if the partnership has established management officials other than the general partners)
FSO
ITPSO
Partners other than general partners (e.g., limited partners)

Sole Proprietorship

Owner
Senior Management Official (if different than owner)
FSO (may be owner)
ITPSO

Joint ventures should follow the KMP list for their legal structure—e.g., the KMP for a joint venture formed as an LLC would be the Senior Management Official, FSO, ITPSO, and members of the joint venture. (You can read more about how unpopulated joint ventures can obtain a FCL here.) And, as always, whether your KMP can be cleared or must be excluded rests with the cognizant security agency.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.