In the Matter of the Appeal of October 8, 1976

 CONTRACT MASTER SERVICES, INC.
 P. O. Box 124
 Cheltenham, Maryland 20623 

 P.S. Docket No. 5/18

 APPEARANCES FOR APPELLANT: 		John F. Wolf, Sr., Esq.
					3409 Shepherd Street
					Chevy Chase, Maryland 20015

 APPEARANCES FOR RESPONDENT:
					Michael J. Vandamm, Esq.
 					Law Department
					U. S. Postal Service
					Washington, D.C.

 Lussier, Edward F.  

Contract Master Services, Inc., has filed a timely appeal from the September 2, 1976, decision of the Assistant Postmaster General, Logistics Department, extending the previously imposed suspension of the contractor for an additional 120 days. The basis for the extension is that the investigation presently underway by the Department of Justice has not been completed.

The appeal letter refers to an ancillary proceeding before the Postal Service Board of Contract Appeals and the contention that the contracting officer's determination was not based on substantial evidence. While taking issue with the need to examine its books the appeal letter indicates the currency of the investigation by advising that its books have been examined in September 10 and 20, 1976, by postal inspectors. The appeal concludes with the statement that--

"We trust that the findings of the U.S. Postal Service Inspectors on their examination of the books and records of the Corporation will be forwarded promptly to the U.S. Attorney, and that the Corporation will be given the opportunity to lift the suspension long before the expiration of the additional 120 days."

The record contains a copy of a letter dated August 30, 1976, from the Assistant United States Attorney in Baltimore to the Postal Service Law Department explaining the reason for delay in examining the corporate records, the need for review thereof before indictment and requesting continual abeyance of administrative action "pending final resolution of criminal charges expected to be brought" against the corporation and its former president. The continuing criminal investigation is further evidenced by a statement filed by Postal Service Counsel after contacting the U.S. Attorney's office.

The applicable regulation, Section 1-685.2 of the Postal Contracting Manual (formerly found in 39 CFR Part 956), permits an extension of the suspension upon written determination of the reasons and necessity therefor. The continuing active investigation by the Department of Justice under the circumstances is an adequate basis for extending the suspension of the contractor. The regulation quite clearly contemplates extensions when a prosecutive action is pending.

The appeal presents no basis to set aside the extension of the suspension and accordingly is denied.