Subpart E-Confidential

Reporting Requirements-Employment and Financial Interests

§ 73.40 Confidential reporting of employment and financial interests-regular Government employees.

(a)(1) Except as provided in paragraphs (e), (h), and (k) of this section, not later than 30 days after entering duty in a position described in paragraph (a)(2) of this section, an employee shall submit in a sealed envelope to the appropriate principal officer a report

(i) On a form made available by the Department; and

(ii) Containing the information specified in this section.

(2) As determined by the principal officer of the principal operating component in which the position is located, positions that are subject to reporting under this section include a position classified as GS-13 or aboveor at a comparable pay level under other authority

(i) That requires the incumbent to exercise judgment in making a Government decision or in taking Government action with regard to

(A) Procurement activities;
(B) Administering

grants or subsidies;

or monitoring

(C) Regulating or auditing private or other non-Federal enterprise; or

(D) Other activities if the decision or action has an economic impact on the interest of any person outside the Government; or

(ii) That presents possible conflictof-interest problems.

(b) The report shall include

(1) A list of the names of all corporations, companies, firms, or other business enterprises, partnerships, nonprofit organizations, and educational or other institutions with or in which the employee, spouse, minor child, or other member of the employee's immediate household has—

(i) Any connection as an employee, officer, owner, director, member, trustee, partner, adviser, or consultant;

(ii) Any continuing financial interest, through a pension or retirement plan, shared income, or other arrangement as a result of any current or

prior employment or business or pro

fessional association; or

(iii) (A) Any financial interestexcept for those financial interests exempted elsewhere in this partthrough the ownership of stock, stock options, bonds, securities, or other arrangements including trusts.

(B) The employee need not report shares in savings and loan associations that are in the nature of savings deposits;

(2) A list of the names of the creditors of the employee, spouse, minor child, or other member of the employee's immediate household, other than those creditors to whom they may be indebted by reason of a mortgage on property which they occupy as a personal residence or to whom they may be indebted for current and ordinary household and living expenses such as those incurred for household furnishings, an automobile, education, or vacations; and

(3) A list of the employee's interests and those of the employee's spouse, minor child, or other member of the employee's immediate household in real property or rights in lands, other than property that he or she occupies as a personal residence.

(c) By such date as the Secretary prescribes, the employee shall annually file a new report meeting the requirements of paragraph (b) of this section with information current through June 30 of that year.

(d) If the employee does not know, but another person does know, any information required to be included on a statement of employment and financial interests or supplementary statement, including holdings placed in trust, the employee shall request the other person to submit the information on the employee's behalf.

(e)(1) Paragraph (a) of this section does not require an employee to submit any information relating to a connection with, or interest in, a professional society or a charitable, religious, social, fraternal, recreational, public service, civic, or political organization or a similar organization not conducted as a business enterprise.

(2) For the purpose of this section, the term business enterprise includes an educational or other institution

doing research and development or related work involving a grant of money from or contract with the Government.

(f) The principal officer of the principal operating component in which the employee works—

(1)(i) Maintains each statement of employment and financial interests in confidence according to the filing, recording, notification, and other requirements of the Privacy Act of 1974 (Pub. L. 93-579);

(ii) Reviews each report and coordinates resolution of any conflict of interest or appearance of conflict of interest; and

(iii) May seek the advice and guidance of the DAEO.

(2) The principal officer and the DAEO do not disclose information from a statement except as the Office of Government Ethics or the DAEO may determine for good cause shown.

(g) The employee's submission of a statement of employment and financial interests and supplementary statements is

(1) In addition to, and not in substitution for, or in derogation of, any similar requirement imposed by law, order, or regulation; and

(2) Does not permit anyone to participate in a matter if participation is prohibited by law, order, or regulation.

(h) This section does not apply to special Government employees, who are subject to the provisions of § 73.41.

(i) The Counselor may exclude from the reporting requirement an employee in a position that meets the criteria in paragraph (a) of this section if

(1) The employee submits a written request for exclusion to the Counselor through the principal officer; and

(2) The Counselor determines that(i) The duties of the position make it unlikely that the employee would be involved in a conflict-of-interest situation; or

(ii) A statement of employment and financial interests is unnecessary because of

(A) The degree of supervision and review over the incumbent; or

(B) The inconsequential effect of any potential conflict-of-interest on the integrity of the Government,

given the employee's level of responsibility.

(j) If an employee believes that his or her position has been improperly included under paragraph (a) of this section, the employee may file a grievance under the Department's grievance procedure.

(k) An employee who is required to file a Public Financial Disclosure Report under Title II of the Ethics in Government Act is not required to file a report under this section.

(Authority: 5 U.S.C. App. 4, E.O. 12565)

§ 73.41 Confidential reporting of employment and financial interests-special Government employees.

(a) At the time of entering Government employment, a special Government employee shall submit in a sealed envelope to the appropriate principal officer on a form supplied by the Department a statement of employment and financial interests that discloses

(1) All current Government employment;

(2) The names of all corporations, companies, firms, or other business enterprises, research organizations, and educational or other institutions in or for which he or she is an employee, officer, member, owner, trustee, director, adviser, or consultant, with or without compensation;

(3) The names of all corporations in which he or she holds stocks or bonds; and

(4) The names of all partnerships in which he or she is engaged.

(b) By such date as the Secretary prescribes, the special Government employee shall annually file a new report meeting the requirements of paragraph (a) of this section with information current through June 30 of that year.

(Authority: 5 U.S.C. App. 4, E.O. 12565)

§ 73.42 Reviewing statements of financial

interests.

(a) The principal officer reviews the statements of employees in his or her principal operating component required by §§ 73.40 and 73.41 to determine whether there is a conflict, or

appearance of conflict, between the interests of each employee and the performance of the employee's service for the Government.

(b) If the possibility of a conflict or appearance of conflict exists, the principal officer provides the employee with an opportunity to explain the conflict or appearance of conflict.

(c) If remedial action is indicated, the principal officer consults with the Counselor and an appropriate management official of the Department.

(d) The principal officer directs whatever appropriate remedial action he or she deems necessary (see § 73.5) after

(1) The review referred to in paragraph (a) of this section;

(2) Consideration of the employee's explanation; and

(3) Any investigation the principal officer considers appropriate.

(Authority: 5 U.S.C. App. 4, E.O. 12565)

Subpart F-Post-Employment
Conflicts of Interest

873.50 Disciplinary proceedings for postemployment conflicts of interest.

(a) Transmittal of allegations. (1) An employee who initiates or receives an allegation that a former employee has violated 18 U.S.C. 207 (a), (b), or (c) or any regulations of the Office of Government Ethics or the Department implementing these statutory provisions shall submit the allegation and any supporting evidence to the Counselor.

(2) If the former employee was a member of the Counselor's office, the Secretary designates another employee, not connected with the Counselor's office, to perform the functions of the Counselor under this subpart.

(b) Privacy. Until the Counselor determines there is sufficient cause to initiate an administrative disciplinary proceeding, the Counselor safeguards the allegation and evidence in order to protect the privacy of the former employee.

(c) Involvement of Department of Justice and Office of Government Ethics. (1) If the information concerning a possible violation does not appear to be frivolous, the Counselor expeditiously provides all relevant evi

dence, any appropriate comments, and copies of applicable agency regulations to the Director, Office of Government Ethics, and to the Criminal Division, Department of Justice.

(2) Unless the Department of Justice informs the Counselor that it does not intend to initiate criminal prosecution, the Counselor coordinates any investigation or administrative action with the Department of Justice in order to avoid prejudicing criminal proceedings.

(d) Initiation of disciplinary proceedings. If the Counselor determines after appropriate review that there is reasonable cause to believe that the former employee has committed a violation, the Counselor may

(1) Initiate an administrative disciplinary proceeding; and

(2) Designate an individual to represent the Department in the proceeding.

(e) Notice. (1) The Counselor or an individual designated under paragraph (d)(2) of this section provides the former employee with written notice of the Department's intention to institute a proceeding and of the former employee's opportunity for a hearing. (2) The notice includes the following:

(i) A statement of allegations, and the basis for the allegations, in sufficient detail to enable the former employee to prepare an adequate defense.

(ii) Notification of the former employee's right to a hearing and to submit an answer within 30 days of receipt of the notice.

(iii) An explanation of the method by which a hearing may be requested. (iv) A notification that if the former employee fails to submit an answer within 30 days of receipt of the notice, the presiding official may render a decision by default against the former employee.

(f) Hearing. The former employee may obtain a hearing by submitting a written request to the Counselor within 30 days of receipt of the notice. (g) Examiner. The Secretary designates as the presiding official at the proceedings a hearing examiner who(1) Is impartial;

(2) Did not participate in the decision to initiate the proceedings; and

(3) Is authorized by the Secretary to make an initial decision.

(h) Time, Date, and Place. (1) The hearing examiner conducts the hearing at a reasonable time, date, and place.

(2) In setting the date, the hearing examiner considers the former employee's need for

(i) Adequate time to properly prepare a defense; and

(ii) An expeditious resolution of allegations that may be damaging to the former employee's reputation.

(i) Hearing rights. The hearing includes, as a minimum, the right of each party to

(1) Represent himself or herself or be represented by counsel;

(2) Introduce and examine witnesses and submit physical evidence;

(3) Confront and cross-examine adverse witnesses;

(4) Present oral argument; and (5) On request, have a transcript or recording of the proceedings.

(j) Burden of Proof. The Department has the burden of proof and must establish substantial evidence of a violation.

(k) Decision. The hearing examin

er

(1) Makes a decision based exclusively on the record of the proceedings; and

(2) Discloses all findings of fact and conclusions of law relevant to the decision.

(1) Appeal within the Department. (1) Within 30 days of the date of the hearing examiner's decision, either party may appeal the decision to the Secretary.

(2)- The Secretary makes a decision on the appeal based solely on the record of the proceedings or on those portions of the record agreed to by the parties to limit the issues.

(3) If the Secretary modifies or reverses the hearing examiner's decision, the Secretary specifies the findings of fact and conclusions of law that are different from those of the hearing examiner.

(m) Administrative Sanctions. (1) The Secretary may take administrative sanctions if

(i) The former employee fails to answer or request a hearing after receipt of adequate notice; or

(ii) The hearing examiner or the Secretary has made a final administrative determination that the former employee had violated 18 U.S.C. 207 (a), (b), or (c) or regulations of the Office of Government Ethics or the Department under these statutory provisions.

(2) If the former employee does not file an answer within 30 days of receipt of the notice, the Counselor may render a decision by default against the former employee.

(3) The Secretary may

(i) Prohibit the former Government employee from appearing before or communicating with the Department on behalf of any other person for a period that does not exceed five years;

or

(ii) Take other appropriate disciplinary action.

(n) Judicial Review. If the Department's administrative decision finds that the former employee participated in a violation of 18 U.S.C. 207 (a), (b), or (c) or regulations of the Office of Government Ethics or the Department issued under these statutory provisions, the former employee may seek judicial review of the administrative decision.

(Authority: 18 U.S.C. 207)

[54 FR 5026, Jan. 31, 1989; 54 FR 6364, Feb. 9, 1989]

APPENDIX TO PART 73-CODE OF ETHICS FOR GOVERNMENT SERVICE

Any person in Government service should: Put loyalty to the highest moral principles and to country above loyalty to persons, party, or Government department.

Uphold the Constitution, laws, and regulations of the United States and all governments therein and never be a party to their evasion.

Give a full day's labor for a full day's pay; giving to the performance of his duties his earnest effort and best thought.

Seek to find and employ more efficient and economical ways of getting tasks accomplished.

Never discriminate unfairly by the dispensing of special favors or privileges to anyone, whether for remuneration or not; and never accept, for himself or his family,

favors or benefits under circumstances that might be construed by reasonable persons as influencing the performance of his governmental duties.

Make no private promises of any kind binding upon the duties of office, since a Government employee has no private word which can be binding on public duty.

Engage in no business with the Government, either directly or indirectly, that is inconsistent with the conscientious performance of his governmental duties.

Never use any information coming to him confidentially in the performance of governmental duties as a means for making private profit.

Expose corruption wherever discovered. Uphold these principles, ever conscious that public office is a public trust.

(This Code of Ethics was agreed to by the House of Representatives and the Senate as House Concurrent Resolution 175 in the Second Session of the 85th Congress. The Code applies to all Government employees.)

Monitoring by recipients.

74.82 Performance reports under nonconstruction grants.

74.83 Performance reports under construc

tion grants.

74.84 Significant

developments

scheduled reporting dates.

74.85 Site visits.

between