On September 9, 2025, the Department of Defense (DOD) released its long-anticipated final rule implementing the Cybersecurity Maturity Model Certification (CMMC) program. As discussed previously, this rule marks a significant milestone in the federal government’s ongoing efforts to bolster federal contractors’ cybersecurity.
In this blog post, we will discuss the framework of the CMMC program, the timeline for the implementation of the rule, and practical guidance for federal contractors—including tips for compliance and approaches to minimizing risk under the False Claims Act (FCA), which the government has used in recent years to enforce compliance with contractual cybersecurity requirements.
Overview of the Final CMMC Rule
The CMMC program, now implemented in the Defense Federal Acquisition Regulation Supplement (DFARS), establishes a tiered model of cybersecurity requirements for nearly all defense contracts and solicitations. The final rule introduces a phased, three-year implementation period beginning 60 days after publication in the Federal Register, making the rule effective on November 10, 2025.
Over the next three years, CMMC requirements will be gradually incorporated into new contracts and contract modifications. By year four, all contracts requiring the storage or transmission of Federal Contract Information (FCI) or Controlled Unclassified Information (CUI) will be subject to the appropriate CMMC level. The DOD expects the rule to impact approximately 338,000 contractors and subcontractors, including an estimated 230,000 small entities.[1]
Under the CMMC framework, contracts will be assigned one of three cybersecurity levels:
- CMMC Level 1: Focused on basic safeguarding of FCI, most contractors (about 210,000) will fall into this category and will be required to perform annual self-assessments.
- CMMC Level 2: Designed for contractors handling CUI, this level introduces more stringent requirements. While a small subset of Level 2 contractors may self-assess, the majority—approximately 118,000 entities—must obtain certification from a CMMC Third-Party Assessor Organization (C3PAO).
- CMMC Level 3: Reserved for the most sensitive contracts, Level 3 requires DOD-led assessments and certification, affecting a much smaller group (about 3,400 entities).
Contractors must post the results of their CMMC Level 1 and Level 2 self-assessments to the Supplier Performance Risk System (SPRS) before contract award, option exercise, or extension. Importantly, contractors are required to maintain their CMMC status throughout the life of the contract.
In addition, the rule requires contractors to affirm their compliance to the government on an annual basis. False affirmations could result in adverse government actions such as contract termination, negative past performance assessment, suspension and debarment proceedings, and recovery of damages and fines under the FCA.
Takeaways for Federal Contractors: Compliance, Risk Mitigation, and FCA Implications
The Importance of Compliance
The CMMC rule is not merely a regulatory formality—it is a critical component of the DOD’s strategy to protect sensitive information and national security interests. Noncompliance can result in lost contract opportunities, reputational harm, and exposure to significant legal and financial risks.
To comply, contractors must:
- Understand the Required CMMC level: Review contract requirements to determine the applicable CMMC level. Notably, contracts exclusively for commercially available off-the-shelf (COTS) items have been exempted from CMMC requirements. Additionally, subcontractors should review their flow-down provisions for this CMMC rule.
- Assess current cybersecurity posture: Conduct a gap analysis against the relevant CMMC requirements.
- Develop and implement remediation plans: Address deficiencies and document all processes and controls.
- Engage with C3PAOs (if required): For most Level 2 contractors, third-party assessment and certification are mandatory.
- Maintain compliance: CMMC is not a “one-and-done” exercise. Contractors must sustain compliance throughout contract performance and update their practices as threats and requirements evolve.
Practical Steps to Achieve Compliance
- Start Early: The assessment and certification process can be time-consuming, especially for organizations new to federal cybersecurity requirements.
- Document Everything: Maintain thorough records of policies, procedures, and technical controls. Documentation is critical for both self-assessments and third-party reviews.
- Train Personnel: Ensure that staff understand their roles in maintaining cybersecurity and compliance.
- Monitor and Update: Regularly review and update cybersecurity measures to address new threats and changes in DOD requirements.
CMMC and the False Claims Act: An Additional Layer of Protection
Recent years have seen the Department of Justice (DOJ) increasingly use the FCA to investigate and prosecute contractors who misrepresent their cybersecurity compliance.
The CMMC rule, particularly its third-party assessment requirement for most Level 2 contractors, offers a significant potential benefit: it provides credible, independent evidence of compliance. A successful assessment from a third party decreases the risk of an FCA enforcement action from the DOJ, provided the contractor is forthcoming and accurate during the assessment process. Contractors must honestly represent their compliance to assessors and maintain compliance throughout contract performance.
While the third-party CMMC certification process does not eliminate FCA risk entirely, the clarity and transparency provided by the CMMC framework should help reduce the “guessing game” around DOD expectations and help contractors demonstrate good faith efforts to comply.
Conclusion
The finalization of the CMMC rule is a watershed moment for the defense contracting community. Compliance is now a prerequisite for doing business with the DOD. By taking proactive steps to understand and meet CMMC requirements, contractors can protect sensitive information and national security while maintaining their competitiveness for contract awards.
[1] All statistics in this blog post were provided by DOD in the final rule.
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