(c) A former employee or a former special Government employee, who has outstanding scientific or technological qualifications, may, paragraphs (a) and (b) of this section notwithstanding, act as attorney or agent or appear personally in connection with a particular matter within the Administration in a scientific or technological field provided the Administrator first certifies in writing, published in the FEDERAL REGISTER, that the national interest would be served by such action or appearance by the former employee.

(d) A former employee who occupied a position or engaged in activities involving discretion with respect to the granting of assistance under the Small Business Act, as amended, or the Small Business Investment Act of 1958, as amended, is disqualified from accepting any employment with or being retained by any business concern which has been given assistance by the Administration, for a period of 2 years following the date of such assistance if such date falls within the period of his employment with the Administration or within a year after such employment has ceased. All clerical positions in the Administration and all nonclerical positions in the Office of Assistant Administrator for Administration and in offices thereunder, are determined to be positions and activities which do not involve discretion with respect to the granting of assistance under the Small Business Act, as amended, and the Small Business Investment Act of 1958, as amended. The discretionary nature of the position and activities of other employees shall be determined by the Administrator at such time as the employee terminates his employment with the Small Business Administration. § 105.735-3-2 Present employees and claims against or business with the Government.

(a) No employee, otherwise than in the proper discharge of his official duties shall act as agent or attorney for prosecuting any claim against the United States or receive any gratuity, or any share of or interest in any such claim in consideration of assistance in the prosecution of such claim; nor shall he act as agent or attorney for anyone before any department, agency, court-martial officer, or any civil, military, or naval commission in connection with any proceeding, application, request for a ruling, or other determination, contract, claim.

controversy, charge, accusation, arrest, or other particular matter in which the United States is a party or has a direct and substantial interest: nor shall he ask for nor receive any compensation, otherwise than as provided by law for the proper discharge of official duties, for any services rendered or to be rendered by himself or another in relation to such matters. 18 U.S.C. 203 and 205 make such activity a criminal offsense.

(b) A special Government employee shall be subject to paragraph (a) of this section only in relation to a particular matter, involving a specific party or parties.

(1) In which he has at any time participated personally and substantially as an employee or as a special Government employee through decision, approval, disapproval, recommendation, the rendering of advice, investigation or otherwise, or

(2) Which is pending in the Administration while he is serving as such special Government employee. 18 U.S.C. 205 provides criminal penalties for such activities.

(c) A special employee who has served no more than 60 days in the Administration during the immediately preceding period of 365 consecutive days is subject to all the limitations of paragraph (b) of this section except subparagraph (2) of paragraph (b) of this section.

(d) Notwithstanding the provisions of paragraphs (a), (b), and (c) of this section.

(1) If the Director of Personnel approves, an employee or special Government employee may act, with or without compensation, as agent or attorney for his parents, spouse, child, or any person for whom, or for any estate for which, he is serving as guardian, executor, administrator, trustee, or other personal fiduciary except in those matters in which he has participated personally and substantially as an employee, or special Government employee through decision, approval, disapproval, recommendation, the rendering of advice, investigation, or otherwise, or which are the subject of his official responsibility. Prior to granting such approval the Director of Personnel shall obtain the advice of the Ad Hoc Committee (established by § 105.735-10) concerning the propriety of granting the approval.

(2) An employee, if not inconsistent with the faithful performance of his duties, may act without compensation as

agent or attorney for any person who is the subject of disciplinary, loyalty, or other personnel administration proceedings in connection with those proceedings.

(e) A special Government employee may act as agent or attorney for another person in the performance of work under a grant by, or a contract with or for the benefit of, the United States: Provided, That

(1) The approval of such employment is received from the Director of Personnel,

(2) The head of the department concerned with the grant or contract certifies in writing that the national interests so requires, and

(3) Such certification is published in the FEDERAL REGISTER.

(f) No employee or special Government employee shall participate in any business transaction with the Administration, directly or indirectly, as an agent, representative, attorney, partner or principal, except as may be authorized by this section and § 105.735-4-3.

(g) No employee or special Government employee shall recommend or suggest the use of any individual, firm, corporation, or other nongovernmental entity offering any service as consultant, agent, representative, attorney, expediter, or "specialist," for the purpose of assisting in any negotiations, transactions, or other business with the Administration or with any other Government department.

participation, the Ad Hoc Committee (established by § 105.735-10) determine that such participation by the employee will not interfere with the performance of his duties.

(d) No employee, or special Government employee, shall ask, demand, exact, solicit, seek, accept, receive, or agree to receive anything of value for himself or for any other person or entity, in return for being influenced in his performance of any official act, for being influenced to commit or aid in committing, or to collude in, or allow, any fraud, or make opportunity for the commission of any fraud, on the United States or for being induced to do or omit to do any act in violation of his official duty. 18 U.S.C. 201 provides criminal penalties for such actions.

(e) No employee shall solicit or receive a bribe of any kind to support or influence decisions for the hiring of any person as an employee in the Government. 18 U.S.C. 211 makes such activity a criminal offense.

(f) Except as provided in paragraph (g) of this section, no employee, nor member of his or her household, shall solicit or accept, directly or indirectly, any gift, gratuity, favor, entertainment, loan, or any other thing of monetary value, from a person who:

(1) Has, or is seeking to obtain, financial assistance, a certificate of competency, a small business investment company license, or any other contractual or other business or financial relations with the Administration;

(2) Is an officer, director, or owner of a financial institution which participates with the Administration in the agency loan program;

(3) Conducts operations or activities regulated by the Administration; or

(4) Has interests that may be substantially affected by the performance or nonperformance of the employee's official duty.

(g) The prohibitions of paragraph (f) of this section shall not apply to:

(1) Gifts, entertainment, and favors received from members of the employee's family when the circumstances make it clear that it is the family relationship rather than the business of the persons concerned which are the motivating factors;

(2) [Reserved]

(3) The acceptance of loans from banks or other financial institutions on customary terms to finance proper and

usual activities of employees, such as home mortgage loans and auto financing:

(4) The acceptance of unsolicited advertising or promotional material, such as pens, pencils, note pads, calendars, and other items of nominal intrinsic value, provided the employee informs his immediate supervisor by written memorandum of the acceptance of such item. In the event the supervisor questions the intrinsic value of the items involved, he shall refer the matter to the Ad Hoc Committee (established by § 105.735-10) for consideration.

(h) No employee shall engage in any action, whether or not specifically prohibited, which might result in, or create the appearance of:

(1) Using public office for private gain;

(2) Giving preferential treatment to any person or concern;

(3) Impeding Government efficiency or economy;

(4) Losing complete independence or impartiality;

(5) Making a Government decision outside official channels; or

(6) Affecting adversely the confidence of the public in the integrity of the Government.

(i) An employee shall not solicit a contribution from another employee for a gift to an official superior, make a donation as gift to an official superior, or accept a gift from an employee receiving less pay than himself (5 U.S.C. 7351). However, this paragraph does not prohibit a voluntary gift of nominal value or donation in a nominal amount made on a special occasion such as marriage, illness, or retirement.

(j) No employee shall accept a gift, present, decoration or other thing from a foreign government unless authorized by Congress as provided by the Constitution and in 5 U.S.C. 7341.

(k) Neither this section nor section 105.735-4-6 precludes an employee from receipt of bona fide reimbursement, unless prohibited by law, for expenses of travel and such other necessary subsistence as is compatible with this part for which no Government payment or reimbursement is made. However, this paragraph does not allow an employee to be reimbursed, or payment to be made on his behalf, for excessive personal living expenses, gifts, entertainment, or other personal benefits. nor does it allow an

employee to be reimbursed by a person for travel on official business under agency orders when reimbursement is proscribed by Decision B-128527 of the Comptroller General dated March 7, 1967.

[Rev. 1, 31 F.R. 4670, Mar. 19, 1966, as amended by Amdt. 2, 31 F.R. 10633, Aug. 10, 1966; Amdt. 4, 32 F.R. 14383, Oct. 18, 1967) § 105.735-3-4 Preferential treatment to or discrimination against private interests.

No employee or special Government employee in the conduct of official business shall afford preferential treatment to or discriminate against any person, firm, corporation, or other entity. [Amdt. 1, 31 F.R. 7375, May 21, 1966]

§ 105.735-4 Conflicts between personal or pecuinary interests of employees and the Government.

The interest of the Government must remain paramount and take precedence over the personal pecuniary interests of all employees. The employee does not function as an individual but merely as a representative or arm of the Government. An employee whose individual pecuniary interests conflict with and take precedence over the interests of the Government is unable to honorably discharge his responsibilities.

§ 105.735-4-1 Purchase and holding of securities of small business investment companies.

(a) For the purposes of this section employees are considered to have sufficient interest in the purchases by and holdings of their spouses or by other members of their household so that such purchases or holdings are subject to the terms of this section.

(b) No employee shall purchase or otherwise acquire or own or hold, directly or indirectly, any interest in or securities issued by a small business investment company licensed by the Administration under the provisions of the Small Business Investment Act of 1958. as amended.

(c) No employee shall own stock or have an interest in a concern or organization which owns stock or other interest in a small business investment company, described in paragraph (b) of this section, when:

(1) Such employee, spouse or any member of his or her household, participates in the management of or par

ticipates directly or indirectly, in the selection of investments for or by such concern or organization; or

(2) Such employee, spouse or member of his or her household, owns 1 percent or more of the stock of, or interest in, such concern or organization; or

(3) The concern or organization invests more than 10 percent of its assets in any one or several small business investment companies:

Provided, however, That investment by an employee, his or her spouse, or any member of his or her household in a diversified open-end management investment company as defined by section 5 of the Investment Company Act of 1940 (15 U.S.C. 80a-5) shall be exempt from the restrictions contained in subparagraphs (2) and (3) of this paragraph.

(d) Any employee who is a trustee or other fiduciary or a beneficiary of a trust or estate holding securities of licensed small business investment companies shall report the existence and nature of such trust or estate to the Director of Personnel. The transactions of such trust or estate shall be subject to the provisions of this regulation, except in situations where the employee is solely a beneficiary and has no power to control, and does not in fact control or advise with respect to the investments of the trust or estate, and except to the extent that the Administrator shall otherwise direct in view of the circumstances of the particular case.

(e) All employees at the time of their entrance on duty, shall sign and deliver to their Office Director, a certification in the following form:

I certify that I have read the regulation of the Small Business Administration concerning the conduct of employees of the SBA with respect to the purchase and holding of securities issued by licensed small business investment companies and that, as such employee, I do not own or hold, directly or indirectly, any securities of such a licensed small business investment company. § 105.735-4-2 Interest in firms receiving Administration assistance and other firms.

(a) No employee, his spouse, nor members of his immediate household shall purchase or otherwise acquire any interest, as a stockholder or otherwise, in any concern while an application of such concern for assistance from the Administration is pending and for a pe

riod of two years after such assistance is granted, regardless of whether the concern is a publicly held corporation.

(b) No employee, or special Government employee, shall participate personally and substantially as an Administration employee or special Government employee, through decision, approval, disapproval, recommendation, the rendering of advice, investigation, or otherwise, in a judicial or other proceeding application, request for a ruling or other determination, contract, claim, controversy, charge, accusation, arrest, or other particular matter in which, to his knowledge, he, his spouse, minor child, partner, organization in which he is serving as officer, director, trustee, partner or employee, or any person or organization with whom he is negotiating or has any arrangement concerning prospective employment, has a financial interest without:

(1) Making a full disclosure of the facts to the Ad Hoc Committee (established by § 105.735-10), and

(2) Obtaining a written determination by the Administrator that such financial interest is not so substantial as to be deemed likely to affect the integrity of the services which the Government may expect from such employee or special Government employee. 18 U.S.C. 208 makes noncompliance a criminal offense.

(c) For the purposes of 18 U.S.C. 208 and paragraph (b) of this section, any financial interest on the part of persons referred to therein is hereby determined to be not so substantial as to be deemed likely to affect the integrity of the services which the Government may expect from any employee or special Government empoyee when such financial interest results from a creditor relationship to a concern wherein the indebtedness is not in excess of $10,000 or when such financial interest results from an ownership interest of less than one percent in any concern in which such ownership interest amounts to less than $10,000 in equity investment. Computations dollar-value of stock holdings in corporations for purposes of this paragraph shall be (1) by means of market value in the case of stocks listed in national exchanges, (2) by means of over-the-counter market quotations as reported by the National Daily Quotation Service in the case of unlisted stocks and (3) by means of sound book value in the case of stocks not in the preceding two categories.

of

§ 105.735-4-3 Assistance by the Administration to businesses owned or managed by officers, employees or special employees of the Government or members of Small Business Advisory Councils.

(a) No assistance, other than disaster loans under subparagraphs (1) and (2) or paragraph (b) of section 7 of the Small Business Act, as amended, shall be furnished to a business enterprise when the sole proprietor, a partner, an officer or director thereof, or a stockholder with a 10 or more percent interest therein:

(1) Is (i) an employee of the Administration or an employee in Grade GS-13 or its equivalent, or higher, of any other department in the executive branch, or (ii) an officer of the rank of major or lieutenant commander or its equivalent, or higher, in the Armed Services of the United States, or (iii) an appointed consultant or special Government employee of the Administration, or a member of a Small Business Advisory Council, or (iv) a spouse of any of the above, without the prior approval of the Ad Hoc Committee (established by § 105.735-10).

(2) Is (i) an employee in Grade GS-12 or its equivalent or lower, of any other department in the executive branch, or (ii) a member of the Armed Services of the United States of the rank of captain or lieutenant senior grade, or its equivalent, or lower, or (iii) a spouse of any of the above, without prior written statement of no objection by the pertinent department or Armed Service of the United States.

(b) No assistance shall be furnished to a business enterprise when the proceeds of such assistance shall inure, directly or indirectly, to the benefit of an employee, without the prior approval of the Ad Hoc Committee (established by § 105.735-10).

[Rev. 1, 31 F.R. 4670, Mar. 19, 1966, as amended by Amdt. 2, 31 F.R. 12596, Sept. 24, 1966]

(c) No employee shall use Government property of any kind for other than officially approved activities. Employees also have a positive responsibility to protect and conserve all Government property including equipment and supplies, which is entrusted or issued to them. [Rev. 1, 31 F.R. 4670, Mar. 19, 1966, as amended by Amdt. 4, 32 F.R. 14384, Oct. 18, 1967]

§ 105.735-4-5 Conversion, distortion of records.

(a) No employee shall embezzle or convert to his own use money or property of another coming into his possession, or public monies of any kind or intentionally make false or fictitious entries in accounts or records which he is charged to keep. 18 U.S.C. 643, 654, 2073 make these activities a criminal offense.

(b) No employee who has custody of any map, book, document, paper, or thing filed in a public office shall remove, mutilate, obliterate, falsify, or destroy the same. 18 U.S.C. 2071(b) makes these acts criminal offenses. § 105.735-4-6

Outside employment.

(a) Except upon written approval of the Director of Personnel or his designee, no employee shall engage in any outside employment, business, or vocation.

(b) While employees are encouraged to engage in teaching, lecturing and writing that is not prohibited by law, or the regulations in this part, no approval shall be granted and no employee shall, either for or without compensation, engage in teaching, lecturing, or writing that is dependent on information obtained as a a result of his Government employment, except when that information has been made available to the general public or will be made available on request, or when the Administrator gives written authorization for the use of nonpublic information on the basis that the use is in the public interest.

(c) No employee shall engage in outside employment or other outside activity not compatible with the full and proper discharge of the duties and responsibilities of his Government employment. Incompatible activities include, but are not limited to:

(1) Acceptance of a fee, compensation, gift, payment of expense, or any other thing of monetary value in circumstances in which acceptance may result in, or create the appearance of, a conflict of interest; or