for the use of nonpublic information on the basis that the use is in the public interest.

(3) An employee may use his or her title in connection with writing for publication only if:

(i) The writing contains a statement indicating that the views contained therein are those of the employee as an individual and do not necessarily represent the views of the Department of Housing and Urban Development; or

(ii) Such use of the employee's title is approved in advance by the appropriate Assistant Secretary or equivalent, or his or her designee.

(4) An employee may not accept any honorarium of more than $2,000 for any appearance, speech or article (2 U.S.C. 4411), except if the honorarium is paid directly to a charitable organization at the request of the employee and selected by the payor from a list of 5 or more charitable organizations provided by the employee. In computing the $2,000 amount, the following may be excluded:

(i) Actual travel and subsistence expenses for the employee and the employee's spouse or aide; and

(ii) Amounts paid or incurred for any agent's fees or commissions.

(f) Any employee who is compensated at an amount equal to or above GS-16 in the General Schedule and who occupies a full-time position, appointment to which must be made by the President by and with the advice and consent of the Senate, may not have in any calendar year outside earned income attributable to such calendar year which is in excess of 15 per cent of the employee's salary (Pub. L. 95-521, section 210, 5 U.S.C. App.).

(g) An employee may not directly or indirectly seek or receive compensation for services, rendered by himself or others, in connection with any proceeding, application, request for ruling, contract, claim, or other particular matter in which the United States is a party or has a direct and substantial interest and which is before any Federal or District of Columbia department or agency (18 U.S.C. 203).

(h) An employee may not act, with or without compensation, as agent or attorney for another:

(1) In prosecuting a claim against the United States; or

(2) In connection with any proceeding, application, request for ruling, contract or other particular matter in which the United States is a party or has a direct and substantial interest and which is before any Federal or District of Columbia department, agency, or court (18 U.S.C. 205).

(i) Permissible exceptions to the prohibitions set forth in paragraphs (g) and (h) of this section include:

(1) Representation without compensation in connection with a disciplinary, loyalty, or personnel proceeding; (2) Representation with or without compensation of parents, spouse, child, or those to whom the employee owes a fiduciary duty except in those matters in which the employee has participated personally and substantially as a Government employee or which are the subject of his official responsibility; and

(3) Statements required to be made under penalty for perjury or contempt. An employee seeking to engage in one of these excepted activities is encouraged to consult in advance with a Deputy Counselor.

(j) The prohibitions set forth in paragraphs (g) and (h) of this section are in addition to, and not in lieu of, any other restrictions contained in this subpart.

(k) This section does not prohibit an employee from serving in an individual capacity as an officer or a member of the Board of Directors of:

(1) A Federal Credit Union, or

(2) A cooperative or condominium association for a housing project which is not subject to regulation by the Department or, if so regulated, in which the employee personally resides.

(1) When participating in any activity permitted by this section, an employee shall make certain that his or her official title or Department connection is not shown or used in a manner which implies that the employee is acting in an official capacity.

[52 FR 27113, July 17, 1987. Redesignated at 61 FR 19188, May 1, 1996]

EFFECTIVE DATE NOTE: At 61 FR 19188, May 1, 1996, §0.735-203 was redesignated as §0.2, effective May 6, 1996.

80.3 Financial interests.

(a) An employee shall not have a direct or indirect financial interest that conflicts, or appears to conflict, with his or her official duties and responsibilities. Such interests include, but are not limited to, the voluntary acceptance, acquisition or holding of:

(1) Securities issued by the Federal National Mortgage Association and securities collateralized by FNMA securities.

(2) FHA debentures or certificates of claim.

(3) Stock or other interest in a Department-owned, insured or subsidized multifamily project or single family dwelling, cooperative unit, or condominium unit, except to the extent that the stock or other interest represents the employee's principal residence. Employees who wish to purchase a Department-held property as a principal residence must adhere to the procedures established by the Assistant Secretary for Housing for the administration of the property disposition program set forth in Handbook 4310.5.

(4) Any Department subsidy provided pursuant to section 8 of the United States Housing Act of 1937, as amended, to or on behalf of a tenant of property owned by the employee. However, an employee may accept the benefit of such a subsidy when:

(i) The employee involuntarily acquires a property which at the time of acquisition has a tenant receiving such a subsidy but only as long as that tenant continues to reside in the property,

or

(ii) An incumbent tenant who has not previously received such a subsidy becomes the beneficiary thereof but only if there is no increase in that tenant's rent upon the commencement of subsidy payments other than normal annual adjustments.

(5) Any direct creditor interest in a mortgage insured by the Department.

(b) Notwithstanding paragraph (a) of this section, an employee may accept, acquire or hold

(1) An interest in a mutual or money market fund which has holdings listed in paragraph (a) of this section, and which:

(i) Has a broadly diversified portfolio not specializing in any particular industry;

(ii) Is widely held; and

(iii) Is not under the employee's control.

(2) A limited partnership interest in a large public partnership (i.e. one which has at least 5,000 partnership interests) less than 25% of the assets of which are Department insured or subsidized projects;

(3) Mortgage insurance provided pursuant to section 203 of the National Housing Act on any one single family residence in addition to the employee's current principal residence.

(c) If an employee acquires an interest prior to the commencement of employment with the Department which is prohibited under paragraph (a) of this section, or involuntarily acquires such a prohibited interest after the commencement of employment with the Department, the matter must be reported promptly to a Deputy Counselor. The Deputy Counselor will then determine whether retention of the interest is permissible or whether divestment or other appropriate remedial action is required.

(d)(1) An employee must not participate in his or her capacity as a Government employee in any matter in which, to his or her knowledge, the employee, his or her spouse, minor child, any organization in which the employee is serving as an officer, director, trustee, partner, or staff member, or a partner of the employee has a financial interest. In addition, an employee must not participate in his or her capacity as a Government employee in any matter in which, to the employee's knowledge, a person, business, or nonprofit organization with whom the employee is negotiating, or has an arrangement for, employment has a financial interest. For purposes of this paragraph a matter includes an application, contract, claim, request for a ruling, controversy, charge, accusation, arrest, judicial or other proceeding, or other particular matter. (18 U.S.C. 208(a)).

(2) Paragraph (d)(1) of this section does not apply:

(i) If a Deputy Counselor first determines that the financial interest is not so substantial as to be deemed likely to

affect the integrity of the services which the Government may expect from the employee; or

(ii) If the financial interest is within one of the following categories which are hereby exempted from the requirements of section 208(a) of title 18, United States Code, as being too remote or too inconsequential to affect the integrity of an employee's service:

(A) Any holding in a widely held mutual or money market fund, or regulated investment company, which is not under the employee's control and which has a broadly diversified portfolio not specializing in any particular industry;

(B) Participation in a bona fide employee benefit plan, other than a profit-sharing or stock-bonus plan, that is maintained by a former employer to the extent that the employee's rights in the plan are vested and require no additional services by him or her or further payment to the plan by the former employer with respect to the services of the employee.

[52 FR 27113, July 17, 1987. Redesignated at 61 FR 19188, May 1, 1996]

EFFECTIVE DATE NOTE: At 61 FR 19188, May 1, 1996, §0.735-204 was redesignated as §0.3, effective May 6, 1996.

EFFECTIVE DATE NOTE: At 61 FR 15350, Apr. 5, 1996, part 0 was revised, effective May 6, 1996. For the convenience of the user, the superseded material is set forth as follows:

Subpart A-General Provisions

$0.735-101 Purpose.

The maintenance of high standards of honesty, integrity and impartiality by Government employees is essential for the proper performance of the public business and the maintenance of confidence by citizens in their Government. To inform the public and Department staff as to the specific application of this general principle, this part sets forth the Department's regulations prescribing standards of conduct for, and governing the submission of statements of employment

and financial interests by, its employees. All questions concerning, or requests for, opinions should be directed to the Department Counselor or to a Deputy Counselor, or to the Office of Ethics in Headquarters.

[57 FR 28783, June 29, 1992]

$0.735-102 Definitions.

Business entity means a corporation, company, firm, partnership, society, joint stock company, or any other organization or institution having a business purpose including, but not limited to:

(1) Non-profit organizations or institutions which own or operate housing units, and

(2) Educational and other institutions doing research and development or related work involving grants or other types of flnancial assistance from, or contracts with, the Government.

Disclosure Forms means both Public and Confidential Disclosure Forms.

Employee means an employee of the Department other than a Special Government employee.

Person means an individual human being. Special Government employee means a person who is retained, designated, appointed or employed by the Department to perform temporary duties, with or without compensation, for not more than 130 days, during any period of 365 consecutive days, either on a full-time or intermittent basis, as defined in 18 U.S.C. 202.

[57 FR 28783, June 29, 1992, as amended at 61 FR 5202, Feb. 9, 1996]

$0.735-103 Notification to employees.

The provisions of this part shall be brought to the attention of, and made available to, each employee and special Government employee at the time of entrance on duty and at least annually thereafter. Each revision of this part shall be brought promptly to the attention of all employees and special Government employees.

$0.735-104 Responsibilities of Ethics Officials.

(a) General Counsel. The General Counsel is the Department's Designated Agency Ethics Official and the Department's Standards of Conduct Counselor (Department Counselor). As the Designated Agency Ethics Official, the General Counsel has primary responsibility for the Department's Standards of Conduct program, and is vested with the duties and responsibilities of a designated agency ethics official as set forth in 5 CFR 2638.203 of the government-wide ethics regulations promulgated by the Office of Government Ethics.

(b) Assistant Secretary for Administration. The Assistant Secretary for Administration is the Alternate Agency Ethics Official. The Assistant Secretary for Administration is re

sponsible for the day-to-day coordination and management of the Standards of Conduct program. The Assistant Secretary for Administration shall carry out his or her responsibilities under the Standards of Conduct Program through the Department's Office of Ethics.

(c) Director of the Office of Ethics. Under the direction of the Assistant Secretary for Administration, the Director of the Office of Ethics will coordinate and manage the Department's Standards of Conduct program. The Director of the Office of Ethics will undertake the day-to-day operation of the Standards of Conduct program.

(d) Regional Director of Administration. The Regional Director of Administration, in each Regional Office, is responsible for implementing the Standards of Conduct program in the Field, as directed by the Office of Ethics.

(e) Regional Counsel. The Regional Counsel, in each Regional Office, is responsible for undertaking those Standards of Conduct program duties, as directed by the Office of General Counsel.

(f) Deputy Counselors. The Associate General Counsel for Equal Opportunity and Administrative Law, the Assistant General Counsel for Personnel and Ethics Law, all Regional Counsels, the Director of the Office of Ethics, and any other employees designated by the Department Counselor, shall serve as the Department's Deputy Standards of Conduct Counselors (Deputy Counselors). The Deputy Counselors assist the General Counsel, as the Designated Agency Ethics Official, in carrying out responsibilities with respect to the Department's Standards of Conduct program and in providing advice to former, current and prospective Department employees regarding questions of conflicts of interest and on other matters relating to Standards of Conduct.

(g) The Inspector General. The Inspector General is the Deputy Counselor for employees of the Office of Inspector General. The Inspector General shall perform all necessary duties involving the Standards of Conduct program for employees of the Office of Inspector General. These duties include the collection, review and maintenance of all Public and Confidential Financial Disclosure Forms submitted by employees of the Office of Inspector General. The Inspector General shall provide advice and guidance to all former, current and prospective employees of the Office of Inspector General regarding matters related to the Standards of Conduct. Legal advice to the Office of Inspector General regarding conflicts of interest and Standards of Conduct shall be provided by the Office of the Associate General Counsel for Program Enforcement.

[57 FR 28783, June 29, 1992]

$0.735-105 Disciplinary and other remedial actions.

(a) When an actual or apparent conflict of interest or other violation of this part is not resolved to the satisfaction of a Deputy Counselor, the matter shall be reported by the Deputy Counselor to the employee's supervisor; copies of the report shall also be provided to the Office of Personnel and Training and other concerned offices, such as the Office of the Inspector General, and the Office of the appropriate Assistant Secretary, Regional Administrator or other field office head.

(b) The employee's supervisor must consider the report of the Deputy Counselor, initiate appropriate remedial action, and inform the Deputy Counselor of the action taken. Remedial action may inlcude, but is not limited to:

(1) Changes in assigned duties;

(2) Divestment by the employee of the conflicting interest within a reasonable time, but normally not more than 60 days after notice that a conflict exists;

(3) Disciplinary action; or

(4) Disqualification for a particular assignment.

Subpart B-Conduct and Responsibilities of Employees

$0.735-201 Proscribed actions.

An employee shall avoid any action, whether or not specifically prohibited by this subpart, which might result in, or create the appearance of:

(a) Using public office or official title for private gain;

(b) Giving preferential treatment; (c) Impeding Government efficiency or economy;

(d) Losing independence or impartiality; (e) Making a Government decision outside official channels;

(f) Adversely affecting the confidence of the public in the integrity of the Government;

(g) Discriminating against any other employee, or applicant for employment, on the ground of race, color, religion, national origin, sex, age, or handicap;

(h) Excluding any person from participating in, or denying to any person the benefits of, any program or activity administered by the Department on the ground of race, color, religion, sex, national origin, age, or handicap; or

(1) Knowingly participating in, or attending while on official business, any segregated meetings, or meetings held in segregated facilities, from which persons are excluded because of race, color, religion, national origin, sex, age or handicap.

$0.735-202 Gifts, entertainment, and favors.

(a) Except as provided in paragraph (b) of this section, an employee shall not solicit or accept, directly or indirectly, any gift, gratuity, favor, entertainment, loan, or any other thing of value, from a person, State government, local government or business entity, or a group of persons, State governments, local governments or business entities, who or which:

(1) Has, or is seeking, and contractual or other business or financial relationship with the Department;

(2) Conducts operations or activities that are regulated by the Department; or

(3) Has interests, or whose members or clients have interests, that may be substantially affected by the actions of the Department.

(b) The prohibitions of paragraph (a) of this section do not apply:

(1) When the circumstances make it clear that family or personal relationships are the motivating factors for a gift, entertainment or favor;

(2) To acceptance of food and refreshments of nominal value on infrequent occasions in the course of a business meeting in which the employee is properly in attendance;

(3) To acceptance by an employee of loans from banks or other financial institutions on customary terms;

(4) To Acceptance by an employee of unsolicited advertising or promotional material, such as pens, pencils, plaques, note pads, calendars, and other items of nominal intrinsic value;

con

(5) To participation by an employee at a widely attended luncheon, dinner, ference, or similar gathering sponsored by a trade, technical, professional or other association or similar group for a discussion of matters related to the work of the Department. Participation must be approved in advance by the employee's supervisor as being in the interest of the Department. Acceptance of food and refreshments from a private company in connection with an association's activities is impermissible.

(6) To acceptance by the Department pursuant to 42 U.S.C. 3535(k) and under its policies governing official travel, of a donation of transportation, lodging or meals from a non-Federal entity to permit an employee to attend a meeting or other event in an official duty status.

(c) An employee shall not solicit contributions for a gift to an official superior, make a donation as a gift to an official superior, or accept a gift from an employee receiving less pay than himself or herself (5 U.S.C. 7351). However, this paragraph does not prohibit voluntary gifts or donations of modest value made because of special circumstances such as marriage, illness or retirement.