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type of provision would enable the Conference to continue the program now in effect. It would provide flexibility in administering the program, and would solve the problem of nonreporting judges. That would be required by statute to comply with the requirements set forth by the Conference.

In any event, the Conference would recommend that the responsibility for the administration and supervision of any financial reporting and disclosure system for the judiciary be centered in the Conference itself, not be relegated to the General Accounting Office or an executive agency, or to any independent agency in the executive branch of government. In this regard, we would endorse the language of sections 301 to 307 of the subcommittee print of amendment H.R. 9 as being preferable to similar provisions in other bills.

We would also recommend that the provisions for asset reportingreporting assets and liabilities—be deleted.

There is one other matter not in my statement I would like to mention, Mr. Chairman. H.R. 9, in regard to asset reporting, contains a provision which exempts the reporting by the spouse of assets that are the spouse's sole property. That provision was not carried forward into the subcommittee print of H.R. 9. As you know, some ladies have independent assets that do not belong to their husbands, and—in this day of women's liberation, I think some ladies may well prefer not to disclose their own sole assets.

Mr. DANIELSON. Going only half way. With women's liberation you're going to find a lot of fine women who are judges and some of them might have a husband who has an asset. So, you don't forget that.

Mr. SPANIOL. That's quite right.
Mr. DANIELSON. You don't mind my chiding you a little bit ?
Mr. SPANIOL. Not at all.
That concludes my formal statement, Mr. Chairman.
[The prepared statement of Mr. Spaniol follows:]


OFFICE OF THE UNITED STATES COURTS 1. This statement summarizes the seven-year efforts of the Judicial Conference of the United States to develop a financial reporting and disclosure system for judicial officers and employees;

2. Suggests that any legislation enacted into law be general in nature giving the Judicial Conference authority to continue its program and requiring judicial officers to comply with Conference directives ;

3. Recommends against a requirement for reporting assets, liabilities and financial transactions by federal judges; and

4. Recommmends that any legislation enacted place control of financial reporting in the Judicial Conference rather than the General Accounting Office or an executive agency. In this regard, the powers given to the Conference under the provisions of Sections 301 to 307 of the Committee Print of Amendments to H.R. 9 would be appropriate.

Mr. Chairman, my name is Joseph F. Spaniol, Jr. I am an Assistant Director in the Administrative Office of the United States Courts. I appear today, at the request of the Committee, to present the views of the Judicial Conference of the United States on the various bills pending before this Subcommittee which relate to financial disclosure and reporting by officers and employees of the Judicial Branch of Government.

The Judicial Conference of the United States has not specifically taken a position on H.R. 1, H.R. 9 and H.R. 6954 of the 95th Congress. The Conference did consider similar bills introduced in the 94th Congress and voted to recommend against enactment of those provisions relating to the Judicial Branch of

Government. As I will explain more fully, this action was taken on the basis that the federal judiciary has already adopted a system of financial reporting and disclosure which the Conference believes is suitable to the needs of the judiciary.

At the outset I would like to say that we believe the Judicial Branch of the Government has for some time now recognized the need to develop a system of ethical standards and the wisdom of requiring financial reporting and disclosure. Whereas other branches of the government have only recently addressed such matters, the Judicial Conference established a reporting system for federal Judges and other judicial officers seven years ago and, within the past two years, has extended that system to cover clerks of court, chief probation officers and certain other officers and employees of the Judicial Branch.

The Judicial Conference's efforts to establish ethical standards in the federal judiciary and to create a systematic procedure for dealing with both ethical problems and financial disclosure and reporting are set out in an article entitled “A Review of the Activities of Judicial Conference Committees concerned with Ethical Standards in the Federal Judiciary, 1969–1976," recently published in Volume 73 of Federal Rules Decisions, page 247. Reprints of this article have been made available to the members of the Subcommittee and to the staff.


I would like to summarize briefly the structure created by the Judicial Conference to deal with ethical problems. There are presently three Judicial Conference committees composed entirely of federal judges which have various areas of responsibility.

The first is the Judicial Conference Advisory Committee on Judicial Activities which renders advice upon request to federal judges on problems arising under the Code of Judicial Conduct for United States Judges which was adopted by the Judicial Conference in 1973. Opinions of this committee are always given in writing. Some are informal, but those which are deemed to be of general interest are separately published as formal opinions for the guidance of all judges. To date the commtitee has considered approximately 190 separate inquiries and has rendered 50 formal opinions.

The second committee is the Judicial Conference Review Committee which receives the semi-annual reports filed by federal judicial officers. In addition to reviewing all reports the committee corresponds directly with reporting officials to clarify items of reporting and refers questions which may arise to the Advisory Committee on Judicial Activities.

The third committee is the Judicial Conference Joint Committee on the Code of Judicial Conduct, consisting of the members of the Judicial Activities Commitee, the Review Committee, and one or two other federal judges, which monitors the operation of the Code of Judicial Conduct for United States Judges in light of perceived and developing problems and makes recommendations for needed changes in the Code.

The Judicial Conference has felt that these three activities—continuous monitoring and updating of an ethical Code, the rendering of timely advice to judicial officers on ethical problems, and the thorough review of financial reports--are essential to a viable program.

FINANCIAL REPORTING By resolution of the Judicial Conference officers and employees of the federal judiciary are now required to file semi-annual financial reports. The items of reporting are four: (1) earned income for extrajudicial services; (2) gifts and bequests received; (3) excess expense reimbursement; and (4) positions held during the reporting period. Five copies of each report are prepared. The original is filed with the Judicial Conference Review Committee and one copy is retained by the reporting official. The other three copies are filed with the chief judge of the circuit in which the judge serves, with the chief judge of his court, and with the clerk of the court in which he serves. The clerk's copy is immediately made available to any litigant in the court or indeed to anyone else who desires to see it. In many localities summaries or excerpts from these financial reports by judges have appeared in the local press.

The filing of financial reports by officers and employees has been a voluntary undertaking by the Federal judiciary and is backed by the moral authority and prestige of the Judicial Conference. There are no sanctions; yet the rate of

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compliance is extremely high. Of the 650 federal judges required to file, only 10 to 12 judges regularly decline to do so “as a matter of conscience." The Judicial Conference has directed that the names of those who do not file reports be published in the reports of Judicial Conference proceedings which, by law, are required to be filed with the Congress. Those judges who do not file financial reports “as a matter of conscience" have indicated in part their belief that judges ought not be "singled out" when government officials in other branches of government do not file similar reports. I might add that some of these nonreporting judges are among the most respected members of the federal bench.

The existing reporting procedure does not require the reporting of assets or liabilities nor does it require the reporting of transactions in securities, real estate, etc. In other respects it is similar to the requirements of reporting set out in the various bills pending before the Subcommittee.

There are several reasons why disclosure of assets and liabilities is not required. Judges and judicial officers are now required by the provisions of section 455 of Title 28, United States Code, to disqualify themselves in any matter in which they may have a financial interest, “however small.” Questions involving the interpretation of this statute on disqualification are, of course, reviewable on appeal. Also, judges are appointed for life, are not subject to the loss of their positions and, as a consequence, do not have the same pressures placed on them that may be felt by other government officials. Nor do they deal directly with industry representatives in the awarding of contracts, the issuance of licenses, etc. which offer opportunities or create situations of potential conflicts of interest, impropriety, or the appearance of impropriety. By not requiring asset reporting, a measure of privacy in the conduct of the affairs of judges is maintained.

PENDING LEGISLATION As previously indicated the success of the efforts of the Judicial Conference in developing a system of financial disclosure and reporting for judicial officers and employees has led the Conference to oppose any legislation on financial reporting solely on the basis that the federal judiciary has voluntarily developed its own program which is suitable, appropriate, and adequate to the needs of a judicial system.

Indeed, the program of the Judicial Conference, based upon the definitive standards of ethical conduct set out in the provisions of the Code of Judicial Conduct for United States Judges, may well be regarded by some commentators as superior to programs of financial reporting proposed in pending legislation for the Legislative and Executive Branches of the Government simply because it is backed by a definitive ethical Code. There is an argument which can be made alleging that any reporting system which is not based on a definition of what is ethical and what is not can never be fully effective. In its effort to regulate itself, the Judicial Branch has concluded that firm rules are necessary and that reporting procedures should be tailored to show compliance with the rules.

If the bill to require financial reporting by the officers and employees of all three branches of the federal government is to be enacted into law, the Judicial Conference of the United States would prefer that the judiciary be covered by a general provision granting authority to the Conference to establish a financial reporting system suitable for the judiciary and requiring judicial officers to comply with any reporting requirements. This type of provision would enable the Conference to continue the program now in effect, provide flexibility and would solve the problem of nonreporting judicial officers with a statutory requirement to report.

In any event the Judicial Conference would recommend that the responsibility for the administration and supervision of any financial reporting and disclosure system for the judiciary be centered in the Conference itself and not be relegated to the General Accounting Office, to an executive agency, or to any independent agency in the Executive Branch of government. In this regard we would endorse the language of sections 301 to 307 of the Subcommittee print of amendments to H.R. 9 as being preferable to similar provisions in other bills pending before the Subcommittee.

Mr. Chairman, thank you for your kind invitation to appear and testify today. If there are questions, I shall be pleased to try to answer them.

Mr. DANIELSON. Thank you, Mr. Spaniol.

I'm very sympathetic to your position, but I think there's a fundamental concept here we have to keep in mind. One, in your opening comment you said the judicial branch has a system which is adequate to meet its needs-or words to that effect.

I don't disagree with that, but what we are trying to do here is to meet the perceived needs of the public, not of the judicial branch, the legislative branch, or the executive branch. So, the underlying reasoning here is sort of inverted. You have to bear that in mind.

Ms. Jordan, do you have questions?
Ms. Jordan. Thank you, Mr. Chairman.

I appreciate the testimony of our witness here; and, Mr. Chairman, it would appear that testimony before us is one more effort on the part of the judiciary to be more privileged than other people who are working for the Government.

What is it about the judiciary which makes you feel that you should be self-policed, but let others be subject to some kind of a requirement for financial disclosure?

I say this in a friendly way, because I know judges are outstanding people, and I would attest to their honesty. But they are also the only people we give a lifetime appointment.

What makes you think that the judiciary should be different from other branches of the Government?

Mr. SPANIOL, Ms. Jordan, in regard to financial reporting and disclosure, I don't think there ought to be any difference. But there are different problems in different branches of the Government, and there are different needs to disclose different types of activities, depending upon the branch of Government. We have built into our Constitution the concept of separation of powers, and we feel that if there is to be a financial reporting system that the judiciary has already

a demonstrated its ability to devise one to meet the public's need for disclosing what should be disclosed within the Federal judiciary.

The judiciary is not opposed to financial reporting; indeed, we feel that we are far ahead of other branches of Government.

Ms. JORDAN. Mr. Spaniol, I hate to interrupt you. You are not saying that for the Congress to enact legislation which would impose financial disclosure requirements on the judiciary would be violative of separation of powers? You're not

Mr. SPANIOL. No, ma'am.

Ms. JORDAN. You're not giving that inference? Well, I didn't know how you threw in separation of powers.

Mr. SPANIOL. Well, I took the question, Ms. Jordan, as being one of having to do with procedure rather than substance. As to the substance, whether or not there should be financial disclosure, the judiciary agrees there should be; it's been the position of the judicial conference now for many years.

On the procedure as to how the disclosure is to be made, and who is to set down the precise requirements for disclosure, we feel that those requirements can be handled and can be set down, unless they are to be uniform-general uniform requirements across the entire Government, that the requirements can be handled by the judiciary itself.

Ms. Jordan. The procedure you outline, used by the judicial conference, has no sanctions built into it whatsoever. It is totally voluntary, and it may be ignored with impunity if a judge so desires.

Mr. SPANIOL. Yes, ma'am.

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Ms. JORDAN. And how do you assess the truthfulness of what has been submitted to these various committees? Does the judge sign his statement under the penalties and pains of perjury, or what do you do?

Mr. SPANIOL. The form does have a statement of attestation by the judge. The forms are reviewed. We have a committee that reviews the forms. We do not make audits or go back behind what is reported.

Ms. JORDAN. So, if he lies, he just lies.

Mr. SPANIOL. We're asking that the judicial conference be given the authority to require these reports, and that the judicial conference be given the authority to review these reports. And we also feel that we do not object to a provision that makes it a crime not to file.

Ms. JORDAN. A crime. What penalty would you have in mind which would be reasonable for that kind of an offense ? Have you talked about that at all in the conference ?

Mr. SPANIOL. No, we have not. But there has been no objection raised to the general criminal sanctions that have been written into most of these bills.

Ms. JORDAN. How many times, if any, have you been caught by a judge who lied in his reports he submitted to the conference, and, somehow, it came out that there was an interest in conflict with the matter considered before the judge.

How often does that occur?

Mr. SPANIOL. I'm sorry; I don't think it has occurred at all, but I can't

say for certain because the review of these forms is carried on by the committee. The administrative personnel—the office in which I work—does not see these reports. They do not come to us. If we want to see a particular report, we would have to go to the office of the clerk of the court to see it. We would be entitled to do that. But we do not assist the committee in the review of these reports, these financial reports. The committee does that work itself.

Ms. JORDAN. Can you think back to the time the nomination of
Judge Haynsworth was before the U.S. Senate?

Ms. JORDAN. Do you recall why that nomination was rejected ?
Mr. SPANIOL. Yes, ma'am.

Ms. JORDAN. And it did have to do with conflict of interest of the judge and some of the matters which had been pending before him in the past; do you recall that?

Mr. SPANIOL. That was part of the

Ms. JORDAN. Part of it, was this procedure of a judicial conference in effect at that time? That was a few years ago, of course.

Were these proceedings—this procedure—in effect at that time?

Mr. SPANIOL. This procedure went into effect in about 1972. I can't recall when the nomination you're speaking of

Ms. JORDAN. Then they were not in effect.

Mr. SPANIOL. And you recall that following all of that, that the Congress did amend section 455 of title 28 on disqualification, and changed that, radically strengthened it a great deal. The old statute was not that clear.

Ms. JORDAN. Will you restate for me the reasons for believing that if financial disclosure requirements are made for the judiciary they should not be required to reveal assets and liabilities?

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