established in the judicial branch various mechanisms for dealing with these problems on a continuing basis. The Judicial Conference has a review committee for administering the program for reporting extrajudicial income comprised of several judges and an Advisory Committee on Judicial Activities which issues advisory opinions on judicial ethics in addition to letter responses to judges. If any judge has a question of whether he is operating on a completely ethical basisand there are many, many gray areas in this field-he can address an inquiry to this committee and receive an advisory opinion on this subject.

We also have a Joint Committee on the Code of Judicial Conduct which administers the Code of Judicial Conduct. We attached a paper to our written statement entitled "A Review of the Activities of Judicial Conference Committees Concerned with Ethical Standards in the Federal Judiciary, 1969 to 1976"; we urge the Committee to review this pamphlet because it gives a historic review of our activities in this area. We ask that we be allowed to continue that type of program as is present.

The Judicial Conference of the United States has no authority, other than the weight of moral persuasion, to impose a financial reporting requirement upon judges and judicial officers of the lower Federal courts. Nonetheless, it is a tribute to the judiciary that except for a very few judges who have sincere reservations regarding the necessity of the program, all others voluntarily comply with Judicial Conference directives and regulations. As the document indicates, approximately 10 judges out of a total of 650 have regularly declined to file these reports only 10 judges. Full-time bankruptcy judges and full-time United States magistrates have fully complied.

The important issue, however, is that the judicial branch is capable of and is effectively administering its own program to insure public confidence in and complete fidelity to the highest standards of ethical behavior. The judiciary's program is tailored to its own special needs. It is essential to our special trust for example that the Judicial Conference of the United States, rather than the General Accounting Office, receive the reports of the judges, if the Judicial Conference is to continue its present public disclosure policies in the various court centers, and if its three concerned committees are to receive and disseminate information necessary to perform their present functions.

This week the committee responsible for the Judicial Conference program-this is an ongoing meeting-will be considering a proposed amendment to H.R. 3249 which would grant to the Judicial Conference of the United States specific authority to adopt rules and regulations governing financial disclosure by judicial officers and require each judicial officer to comply with any rules that are adopted. I suggest that if our present program is in any manner incomplete, that by giving the Judicial Conference rulemaking authority, we could complete our program and satisfy any existing needs with respect to its administration in the judiciary.

If, as I suggest, the judicial branch has its own reporting program and the program is successful, we submit that the necessity for assigning the superintendence of that program to the Comptroller General is not apparent. The independence of the courts is a deeply ingrained principle of government. Alexander Hamilton said in Federalist Paper

No. 78, "The complete independence of the courts of justice is particularly essential in a limited Constitution." That principle of independence from the political arms of Government has been reiterated throughout the 200 years of our Bicentennial history.

We ask the Congress to defer any rush to judgment on a proposal threatening such serious interference with the constitutional principle of separation of powers, and with that equilibrium of checks and balances necessary to maintain the complete independence of the judiciary. At least we ask that a distinction be made between the judiciary and the political branches of Government to allow the judiciary to maintain its own ethical reporting system. There are not those imperatives of time which preclude opportunity for the Judicial Conference to express the viewpoints of the third branch of Government on a proposal having such a potential chilling effect on its independence from the governance of the executive and legislative branches.

Late yesterday I was called by Chief Judge James Browning and other representatives of the Ninth Circuit Judicial Conference, which is now meeting in Spokane, Wash. They informed me of the following resolution, which I would like to quote, which has been adopted by the judges of that circuit, by action taken in executive session; it has also been submitted to the full membership of the Ninth Circuit Judicial Conference this morning. The judges of the ninth circuit have adopted the following resolution, and I will quote:

The Judical Conference of the 9th Circuit resolves as follows with respect to Title III. Title III is bad legislation, not in the public interest, and its enactment should be opposed. It is particularly bad as applied to the Federal Judiciary. As applied to all officers and employees, Title III imposes reporting requirements the administration of which will prove to be complicated, expensive, and in some respects impracticable; it is greatly in excess of those reasonable disclosures that may be necessary to the proper performance of the duties of such officers and employees. The requirement of keeping such detailed records on so many subjects can become a trap for the unwary. Less than total and unethical accuracy may make a criminal or civil defendant out of a totally careful and honest public servant.

Title III by its concern with insignificant financial details impugns the integrity of thousands of honest and dedicated officers and employees, and demeans the positions they occupy, and to which for the good of the country the best should be attracted.

Title III further increases the existing disadvantages of public service without a corresponding increase in the confidence of the public and in government. As applied to Federal judges and justices, Title III should be opposed because 1. There is no crisis of public confidence in the Judiciary which requires such Draconian measures to assure the public of the honesty of the Federal judges. 2. The Federal Judiciary has already adopted a system for public reporting of any income earned from non-judicial services and all positions held in charitable and business organizations. The Judiciary has also adopted for itself a stringent Code of Ethics with machinery for its enforcement. These self-imposed requirements apply to all Federal judges, other than Supreme Court Justices.

3. To subject a judge or justice to a civil suit by the Attorney General may well be contrary to the doctrine of separation of powers. Such suits may also be used to make the Judiciary subservient to the Executive Branch.

4. Imposition of such new rigid reporting requirements to the Judiciary by the Legislative Branch, requirements far beyond the constitutional requirements of impeachment, may well constitute an unconstitutional intrusion by the Leg. islature on the independence of the Judiciary.

I end the quote there. That is the resolution that was adopted by the judges of the Ninth Circuit Judicial Conference yesterday.

Mr. Chairman, I thank you for your consideration of our position. We ask that the system of judicial self-regulation in this area be retained. We ask that we be permitted to present this matter further to the Judicial Conference of the United States when next it meets at its September meeting, and we wish to point out the importance of this matter to the judicial branch.

Mr. Chairman, one further remark. I just received a message just this second that the Judicial Conference of the Ninth Circuit has just voted to approve the resolution of the Watergate Reform Act of 1976, which I have just read.

Thank you for your consideration.

Mr. DANIELSON. Thank you very much, Mr. Imlay.

The gentleman from Ohio, Mr. Kindness.

Mr. KINDNESS. Thank you, Mr. Chairman, I have no questions. Oh, let me take that back.

What, if any procedures, apply to employees of the Federal courts by way of financial disclosure?

Mr. IMLAY. The lesser employees have not been brought under at disclosure provision. I am sure the Director of the Administrative Offices of the United States Courts, for whom I appear today, would be very pleased to consider that proposal. He is empowered under 28 U.S.C. 604 to institute such a system with the concurrence of the Judicial Conference, for the lower-graded employees of the Judiciary. As far as judges are concerned, as I pointed out, there could be a special provision made for judges and magistrates and other judicial officers, in the pending bill.

Mr. KINDNESS. Then nothing applies to employees of the courts other than judges, magistrates, and bankruptcy judges, at the present

time.

Mr. IMLAY. That is correct, except to the extent that the staff of judges, the clerk's office in the court, and so forth, are bound to comply with certain features of the Code of Judicial Conduct, and also various ethical resolutions that the Judicial Conference has passed from time to time.

For example, the Judicial Conference held that a judge's secretary and a judge's law clerk can have no outside employment; the judge's law clerk cannot practice law. There have been various pronouncements which are contained in the Code of Judiciary Conduct, which do cover these lesser, or lower rated employees of the judiciary, Mr. Kindness.

Mr. KINDNESS. And the reporting or disclosure of outside sources. of income, then, is not applied to those employees at the present time. Mr. IMLAY. That is correct.

Mr. KINDNESS. Thank you.

Mr. DANIELSON. Thank you, Mr. Imlay.

As I understand it, the disclosure program which the judiciary now has, basically that's it, it is disclosure which is a public record.

Mr. IMLAY. Yes, sir.

Mr. DANIELSON. It includes outside income; it restricts, eliminates, I should say, any outside income-producing activities.

Mr. IMLAY. Yes.

Mr. DANIELSON. Does it require a listing of holdings other than income?

Mr. IMLAY. It does not, Mr. Chairman, there are many reasons for that. The notion of submitting a balance sheet has not been adopted, and making the balance sheet of the judges public, has not really been accepted in our program. We considered that reporting outside in-come was sufficient to monitor any unethical activities, without the necessity of reporting the assets and liabilities of the judge, his spouse, and other family members.

Furthermore, if we were to make public the assets and liabilities of the judges, such a practice might well lead to forum shopping. Whatever the true situation might be, there may be a feeling among the corporate bar that judges with considerable private wealth in the form of securities might be more favorable to their cause. Litigants. might make distinctions between judges with stock portfolios and those without. Such publication might well detract from that necessary objectivity which a Federal judge must demonstrate when he mounts the bench.

Mr. DANIELSON. Thank you very much, Mr. Imlay. You did comment on one thing with which I certainly agree, the statutory disqualification of a judge for holding one share of stock. That is a magnificent example of "over clean." I hope we can get away from that kind of nitpicking in our legislation.

Mr. IMLAY. Mr. Chairman, this certainly, the Judicial Disqualification Act, is a good illustration of our problems because the one share of stock, or 5-cents worth of ownership in anything disqualifies the judge; however minimal the interest of the judge is, he is disqualified. This has caused judges to have to excuse themselves in cases involving a power company and all sorts of things.

Mr. DANIELSON. I know, almost everybody uses the telephone at one time or another.

Mr. IMLAY. That is correct.

Mr. DANIELSON. I am inferring from your statement that the judiciary are against it.

Mr. IMLAY. Yes.

Mr. DANIELSON. I am not sure they recognize that all of us in public life are sitting on the bull's-eye in this present search for virtue. I tend to agree with you.

Mr. IMLAY. Thank you, Mr. Chairman.

Mr. DANIELSON. Thank you very much. Oh, Mr. Moorhead, do you have any questions? I hope not.

[Laughter.]

Mr. MOORHEAD. I just want to thank you for coming. We understand the problem, and we will certainly consider your statement when we write up the bill.

Mr. IMLAY. Thank you.

Mr. DANIELSON. Thank you very much.

[The prepared statement and attachments of Carl H. Imlay follow:]

STATEMENT OF CARL H. IMLAY, GENERAL COUNSEL, ADMINISTRATIVE OFFICE OF THE U.S. COURTS

Mr. Chairman, my name is Carl H. Imlay. I am General Counsel of the Administrative Office of the United States Courts. I appear today on the invitation of the Committee to testify regarding the position of the Judicial Conference of the United States on H.R. 3249 and related bills which would require candi

dates for Federal office, Members of Congress, and officers and employees of the United States to file statements with the Comptroller General with respect to their income and financial transactions. H.R. 3249 would require every officer and employee of the Federal Government who earns more than $25,000 per annum, including judges, officers, and employees of the Judicial Branch of the Government to file annual reports of income and transactions with the Comptroller General. In addition each officer and employee would be required to report the amount and source of gifts received, the identity of each asset held having a value in excess of $1,000, each liability in excess of $1,000, transactions in securities and commodities, and any purchase or sale of real property. Similar information would be required with respect to income and gifts received by any member of his immediate family. The Judicial Conference of the United States, at its session in September 1975, voted to recommend that judicial officers not be included within the purview of H.R. 110 or H.R. 3249. The Conference addressed itself only to the provision with respect to financial disclosure and took no position with respect to any other provisions of these bills since they did not directly involve the judiciary.

The Judicial Conference makes its recommendation on the basis that the Judicial Branch of Government, under the authority of the Confrence, has adopted a financial disclosure procedure, requiring judges of the United States Courts of Appeals, United States District Courts and special courts (the Court of Claims, the Court of Customs and Patent Appeals, and the Customs Court) as well as full-time bankruptcy judges and full-time United States magistrates, to file periodic reports on extra judicial earned income, gifts and bequests, and positions held in various profit and nonprofit making organizations. This reporting system, which has been in operation since 1970, now requires filing such reports semiannually. A copy of the reporting form currently in use is attached for the information of the Committee.

These reports are open for inspection by the public and have been since the system was put into effect in 1970. A copy is filed with the clerk of court in each judicial district where it in effect becomes a publicly available document. In addition, a copy is filed with the chief judge of each Federal judicial circuit and another copy is filed with a special committee of the Judicial Conference of the United States which meets regularly to review the reports received.

In the six years the system has been in effect it has undergone many modifications by the special Judicial Conference committee charged with its administration, based upon review of the reports, as well as statutory changes and amendments to the Code of Judicial Conduct.

Not only are judges reporting-and publicly reporting-any outside income received. but they are already far more rigidly regulated by law in their financial transactions than the other two branches of Government. For example, under the Judicial Disqualification Act (28 U.S.C. § 455) the ownership of even one share of stock, by the judge, or by the judge's spouse, or by a minor child living in his household, in the matter or party in litigation, will disqualify the judge from hearing the case. In addition, the Judicial Conference of the United States has adopted a Code of Judicial Conduct which strictly limits judges and full-time magistrates and bankruptcy judges from engaging in outside business. Under the Code for example, no judge can be an officer or director of any business. The Code even prohibits a judge from engaging in fund raising in the everymember canvas of his own church. There are numerous proscriptions which are far stricter than those applicable to officers of the other branches. Judges in addition are forbidden by statute from practicing law, and any judge who so practices is guilty of a high misdemeanor (28 U.S.C. § 454). It is logical in this existing scheme that the Judicial Branch have its own reporting requirements and that such reports be directed not to the Comptroller General, but to its highest policy-making body, the Judicial Conference of the United States.

Mr. Chairman, I believe that the Judicial Branch of Government, operating under the aegis of the Judicial Conference of the United States, is considerably ahead of other branches and agencies of the Federal Government in dealing with the problem of financial disclosure. The system it has adopted is viable and workable. Furthermore, there has been established in the Judicial Branch various mechanisms for dealing with these problems on a continuing basis. The Judicial Conference has a Review Committee to administer the program for reporting extrajudicial income, an Advisory Committee on Judicial Activities which issues advisory opinions on judicial ethics in addition to letter responses to judges, and the Joint Committee on the Code of Judicial Conduct which ad