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CHAPTER XII-ACTION

PART 1201-STANDARDS OF

CONDUCT

Subpart A-General

Subpart A-General

Sec. 1201.735-101 Introduction. 1201.735-102 Definitions.

Subpart B-General Conduct and

Responsibilities of Employees 1201.735-201 Proscribed actions–Executive

Order 11222. 1201.735-202 General conduct prejudicial

to the Government. 1201.735-203 Criminal statutory prohibi

tions-Conflict of interest.

Subpart C-Outside Employment, Activities,

and Associations

$ 1201.735-101 Introduction.

(a) Executive Order No. 11222 directs the Civil Service Commission to require each agency head to review and reissue his or her agency's regulations regarding the ethical conduct and other responsibilities of all its employees. One of the main purposes of the regulations in this part is to encourage individuals faced with questions involving subjective judgment to seek counsel and guidance. The general counsel is designated to be the counselor for ACTION with respect to these matters. Associate and assistant general counsels are designated to be deputy counselors. They will provide authoritative advice and guidance in this area to any ACTION employee who seeks it.

(b) The ACTION Committee on Conflict of Interests will review and monitor the agency's policies and procedures on conflict of interests. The committee shall consist of the general counsel, the Assistant Director of Administration and Finance, the Assistant Director of the Office of Compliance, the Director of Contracts and Grants Management Division, Deputy Associate Director of Domestic Operations, a Deputy Associate Director for International Operations, a Deputy Assistant Director for the Office of Policy and Planning, and the Director's designee, who shall be a nonvoting member. The committee shall have the authority to:

(1) Adopt the procedures necessary to insure the implementation of and compliance with the conflict of interest regulations found at $ $ 1201.735301 through 1201.735-305.

(2) Issue interpretive opinions or clarifying statements on actual or hypothetical situations involving the provisions of $ $ 1201.735-301 through 1201.735-305.

(3) Accept and review reports filed under $ 1201.735-302(b).

(4) Grant specific relief from the provisions of $ $ 1201.735-303 through 1201.735-305 by a majority vote of the committee, if, after due consideration, the committee finds that:

1201.735-301 In general. 1201.735-302 Association with a potential

grantee or contractor prior to ACTION

employment. 1201.735-303 Association with ACTION

grantee, contractor, or potential grantee or contractor while an ACTION employ

ee. 1201.735-304 Employment after leaving

ACTION. 1201.735-305 Employment with ACTION

grantee or contractor. 1201.735-306Association with non

ACTION grantee or contractor while an

ACTION employee. 1201.735-307 Gifts, entertainment, and

favors. 1201.735-308 Economic and financial ac

tivities of employees abroad. 1201.735-309 Information. 1201.735-310 Speeches; participation in

conferences. 1201.735-311 Partisan political activities. 1201.735-312 Use of Government property. 1201.735-313 Indebtedness. 1201.735-314 Gambling, betting, and lotter

ies. 1201.735-315 Discrimination. 1201.735-316 Related statutes and regula

tions.

a

Subpart D-Procedures for Submission by Em

ployees and Review of Statements of Employment and Financial Interests

1201.735-401 Submission of statements. 1201.735-402 Review of statements.

AUTHORITY: E.O. 11222 of May 8, 1965, 30 FR 6469, 3 CFR 1964-1965, Supp., p. 306, 5 CFR 735,104.

SOURCE: 43 FR 46022, Oct. 5, 1978, unless otherwise noted.

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(i) No actual conflict of interest exists, and

(ii) The purpose of the rule would not be served by its strict application, and

(iii) A substantial inequity would otherwise occur. In each such case the committee shall issue a written decision setting forth its findings as required above. The committee may make any exception subject to such conditions and restrictions as it deems appropriate.

(c) Any violation of the regulations in this part may be cause for disciplinary action. Violation of those provisions of the regulations in this part which reflect legal prohibitions may also entail penalties provided by law.

(d) This part applies to all employees of ACTION. “Employee" as used in this part includes regular employees, Presidential appointees, “special Government employees,” experts, and consultants whether employed on a full-time or intermittent basis.

or

board or committee which exercises a recommending or supervisory function in connection with an ACTION project;

(2) That the person or his or her spouse, minor child or other member of his or her immediate household, serves as an employee, officer, owner, trustee, partner, consultant, or paid adviser (general membership in an organization is not included within the definition of “associated with");

(3) That the person, his or her spouse, minor child, or other member of his or her immediate household, owns, individually or collectively, 1 percent or more of the voting shares of an organization;

(4) That the person, his or her spouse, minor child, or other member of his or her immediate household, owns, individually collectively, either beneficially or as trustee, a financial interest in an organization through stock, stock options, bonds, or other securities, or obligations, valued at $50,000 or more; or

(5) That a person has a continuing financial interest in an organization, such as a bona fide pension plan, valued at $5,000 or more, through an arrangement resulting from prior employment or business or professional association. The term “associated” does not include an indirect interest, such as ownership of shares in a mutual fund, bank or insurance company, which in turn owns an interest in an organization which has, or is seeking or under consideration for a grant or contract. Such and “indirect” interest, as well as financial interests of amounts less than those stated in paragraphs (f) (3) through (5) of this section, are hereby determined pursuant to 18 U.S.C. 208(b)(2) to be too remote to affect the integrity of the employee's services.

8 1201.735-102 Definitions.

(a) “Special Government employee" as used herein means a person appointed or employed to perform temporary duties for ACTION with or without compensation, on a full-time or intermittent basis, for not to exceed 130 days during any period of 365 days.

(b) “Regular Government employee" as used herein means any officer or employee other than a special Government employee.

(C) “Organization” as used herein includes profit and nonprofit corporations, associations, partnerships, trusts, sole proprietorships, foundations, and State and local government units.

(d) “Grantee” as used herein means any organization that receives financial assistance from ACTION including the assignment of volunteers.

(e) “Potential Grantee or Contractor” means any organization that has submitted a proposal, application, or otherwise indicated in writing its intent to apply for or seek a specific grant or contract.

(f) “Associated with” means:

(1) That the person is a director of the organization or is a member of a

Subpart B-General Conduct and

Responsibilities of Employees

$ 1201.735-201 Proscribed actions—Execu

tive Order 11222. As provided by the President in Executive Order No. 11222, whether spe

cifically prohibited by law or in the (3) They may not for 1 year af regulations in this part, no U.S. regu- their Government employment h lar or special Government employees ended, represent anyone other th shall take any action which might the United States in connection with result in, or create the appearance of: matter in which the United States is

(a) Using public office or employ- party or has an interest and which w ment for private gain, whether for within the boundaries of their offic themselves or for another person, par- responsibility during their last year ticularly one with whom they have Government service. This tempora family, business, or financial ties.

restraint gives way to the permane (b) Giving preferential treatment to restraint described in paragraph (a) any person.

of this section if the matter is one (c) Impeding Government efficiency which the employee participated pe or economy.

sonally and substantially (18 U.S. (d) Losing complete independence or

207). impartiality.

(4) They may not receive any salar (e) Making a Government decision

or supplementation of their Gover outside official channels.

ment salary, from a private source (f) Affecting adversely the confi

compensation for services to the Go dence of the public in the integrity of

ernment (18 U.S.C. 209). the Government.

(b) Special Government employee (g) Using Government office or em

Special Government employees a

subject to the following major crin ployment to coerce a person to provide financial benefit to themselves or to

nal prohibitions:

(1) They may not, except in the di other persons, particularly anyone

charge of official duties, represei with whom they have family, business or financial ties.

anyone else before a court or Gover

ment agency in a matter in which th $ 1201.735-202 General conduct prejudi

United States is a party or has an i cial to the Government.

terest and in which they have at ar

time participated personally and su An employee may not engage in

stantially for the Government (1 criminal, infamous, dishonest, immor

U.S.C. 205). al, or notoriously disgraceful conduct

(2) They may not, except in the di prejudicial to the Government (5 CFR

charge of official duties, represer 735.209).

anyone else in a matter pending befor

the agency they serve unless the $ 1201.735-203 Criminal statutory prohibi

have served there no more than 6 tions-Conflict of interest.

days during the past 365. They ar (a) Regular Government employees. bound by this restraint despite th Regular employees of the Government fact that the matter is not one i are subject to the following major which they have ever participated pe criminal prohibitions:

sonally and substantially (18 U.S.( (1) They may not, except in the dis- 205). (See § 1201.735-303(b) for add charge of their official duties, repre- tional nonstatutory Agency restri sent anyone else before a court or tions on a special employee represen Government agency in a matter in ing any other person or organizatio which the United States is a party or in matter pending before th has an interest. This prohibition ap- Agency.) The restrictions described i plies to both paid and unpaid repre- paragraphs (b)(1) and (2) of this set sentation of another (18 U.S.C. 205). tion apply to both paid and unpai

(2) They may not, after Government representation of another. employment has ended, represent (3) They may not participate in thei anyone other than the United States governmental capacity in any matte in connection with a matter in which in which they, their spouse, mino the United States is a party or has an child, outside business associate, o interest and in which they participat- persons with whom they are negotiat ed personally and substantially for the ing for employment have a financia Government (18 U.S.C. 207).

interest (18 U.S.C. 208).

a

(4) They may not, after their Government employment has ended, represent anyone other than the United States in connection with a matter in which the United States is a party or has an interest and in which they participated personally and substantially for the Government (18 U.S.C. 207).

(5) They may not, for 1 year after their Government employment has ended, represent anyone other than the United States in connection with a matter in which the United States is a party or has an interest and which was within the boundaries of their official responsibility during their last year of Government service. This temporary restraint gives way to the permanent restriction described in paragraph (b)(4) of this section if the matter is one in which they participated personally and substantially (18 U.S.C. 207).

Subpart C-Outside Employment

Activities and Associations

§ 1201.735-302 Association with a poten

tial grantee or contractor prior to

ACTION employment. (a) No employee, or any person subject to his or her supervision, may participate in the decision to award a grant or a contract to an organization with which that employee has been associated in the past 2 years. When an employee becomes aware that such an organization is under consideration for or has applied for a grant or a contract with the Agency, the employee shall notify his or her immediate supervisor in writing. The supervisor shall take whatever steps are necessary to exclude the employee from all aspects of the decision processes regarding the grant or contract.

(b) When the Director, Deputy Director, or an Associate or Assistant Director, becomes aware that an organizatior with which he or she has been associated in the past 2 years is under consideration for or has applied for a grant or contract with the Agency, he or she shall refrain from participating in the decision process and immediately notify the Assistant Director of the Office of Compliance, who shall select an independent third party, not in any way connected or associated with the concerned official. The third party shall participate in and review the decision process to the extent he or she deems necessary to insure objectivity and the absence of favoritism. Said third party shall preferably be a person experienced in the area of government contracts and grants. The third party shall file a report in writing with the Committee on Conflict of Interest stating his or her conclusions, observations, or objections, if any, to the decision process concerning the grant or contract, which document shall be attached to and become a part of the official file.

8 1201.735-301 In general.

(a) There is no general prohibition against ACTION employees holding outside employment, including teaching, lecturing, or writing. But no employee may engage in outside employment or associatons if they might result in a conflict or an appearance of conflict between the private interests of the employee and his or her official responsibility.

(b) An employee shall not receive any salary or anything of monetary value from a private source as compensation for his or her services to the Government (18 U.S.C. 209).

(c) An employee shall not have a direct or indirect financial interest that conflicts substantially or appears to conflict substantially with his or her Government duties and responsibilities. Nor may an employee engage in, directly or indirectly, a financial transaction as a result of or primarily relying on information obtained through his or her Government employment.

$ 1201.735-303 Association with ACTION

grantee or contractor or potential grantee or contractor while an

ACTION employee. (a) No regular employee may be associated with any ACTION grantee, contractor, or potential grantee or contractor. Any organization that is associated with a regular employee

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