Don't believe me? Check out NAVADMIN 080/14:
a. Revocation of Awards (1) Requirement for Honorable Service. 10 U.S.C 6249 provides that no medal, cross, bar, or associated emblem or insignia may be awarded or presented to any individual if the service after the distinguishing act or period has not been honorable. In the event such conduct is discovered after an award is approved but not yet presented, it may be revoked by the approving authority for the award.
(2) The Secretary of the Navy (SECNAV) is the sole authority to revoke awards after presentation.
(3) After presentation, if an awardee's honorable service is questioned or if additional facts are discovered that which call into question the appropriateness of the original approval of the award, forward the entire case and all supporting documentation to SECNAV, via the chain of command, for reconsideration.
(4) In all cases, SECNAV retains the authority to revoke or downgrade any award after approval or presentation if, in the judgment of the Secretary, the awardee did not merit the award or if it is otherwise in the best interests of the Navy.
Think it doesn't happen?
http://www.militarytimes.com/article/20110727/NEWS/107270313/Mabus-revokes-imprisoned-veteran-s-Silver-Star
Yup, revoked a Silver Star. Not something small.