for official use only unclassified 1 ethics for dod leaders march 12, 2009 presented by leigh a....

1For Official Use Only UNCLASSIFIED

ETHICSfor DoD LEADERS

March 12, 2009

Presented byLeigh A. Bradley

Director, DoD Standards of Conduct Office703-695-3422

2For Official Use Only UNCLASSIFIED 2

“Nearly all men can stand adversity, but if you want to test a man’s character — give him power.”

Abraham Lincoln


QUESTION:

You now have assumed significant responsibilities in arguably the largest and most powerful Government bureaucracy on the planet.

How will you exercise your authority, ability to influence, and discretion?


Let’s take a look at the landscape of what not to do.

The following is a small slice of recent criminal actions that are the direct result of ETHICAL LAPSES that have harmed the Public.


As of: 5


Jack Abramoff Scandal

• A sordid tale of Washington corruption and cronyism at its worst. In the course of the scheme, Abramoff and 3 other partners were accused of illegally giving gifts and making campaign donations to legislators and Government officials in return for votes or support of legislation or other Governmental action.

• Abramoff and his partners grossly overbilled clients, splitting multimillion- dollar profits.

• In one case, they secretly orchestrated lobbying against their own clients in order to force them to pay for lobbying services.


And the current headlines . . .

“Bernard Lawrence "Bernie" Madoff, former chairman of the NASDAQ stock exchange, has been charged with perpetrating what may be the largest investor fraud ever committed by a single person.

He is under house arrest and is expected to plead guilty to charges of securities fraud, wire fraud, mail fraud and money laundering on March 12th, 2009.”


And closer to home . . .


Ethical Failures by Federal Government Officials

• 2009: Ex-CIA official, “Dusty” Foggo, 3rd ranking agency official from 2004-2006, sentenced to 37 months in prison for steering procurement contracts to an old friend. Foggo received lavish gifts and vacations in exchange for helping his friend obtain “no-bid” contracts. (Also alleged to have forced CIA to hire his mistress for a six-figure job for which she was unqualified.)

• 2009: Former Eglin AFB engineer indicted for criminal conflict of interest — personally and substantially participated in a contract in which he had a financial interest while he was still employed by the Air Force.


Ethical Failures by Federal Government Officials

• 2008: DOE employee pleads guilty to falsifying time and attendance records — theft of more than $90,000 over a 3-year period; Case investigated by DOE OIG; Maximum Penalty: 10 years in jail and $250,000 fine

• 2007: SAN DIEGO -- A retired Navy rear admiral pled guilty in federal court to a misdemeanor charge of violating conflict-of-interest laws. A top official with the San Diego Unified School District, the admiral was hired by a company trying to win business with the Navy within his one-year "cooling off" period required by federal law for senior government officials. Sentenced to one year’s probation and fine of $15,000.

• 2006: Bonnie Murphy, DoD official, pled guilty to accepting illegal “compensation” ($9,000 worth of gold jewelry) from an Iraqi contractor for helping obtain U.S. Army contracts on a sole source basis


Tanker Deal Headlines and Aftermath


Darleen Druyun

http://www.cbsnews.com/stories/2005/01/04/60II/main664652.shtml


Timeline of Druyan 18 USC 208 Violation

• 13 August 2002: Druyun, senior ranking career Acquisition official in the Air Force meets with Boeing CFO Sears and discusses in general terms, among other things, the possibility of her future employment with Boeing. (She is now technically “seeking employment” under the law.)

• 29 August 2002: Air Force General Counsel prepares disqualification memo covering Lockheed-Martin and Raytheon, but is not asked to include Boeing

• 26 September 2002: Druyun and CFO Sears negotiate the final price for NATO AWACS Mid-Term Modernization Program contract for $1.32B.


As of:

Timeline of Druyun 18 USC 208 Violation

• 17 October 2002: Druyun and Sears meet privately in Orlando airport and discuss terms of employment and reach handshake deal

• 18 October 2002: Sears sends email to senior Boeing managers describing “non-meeting” he had with Druyun regarding her Boeing employment

• 5 November 2002: Druyun submits disqualification letter for Boeing and meets with Sears in the Pentagon to discuss details of employment offer

• 13 November 2002: Boeing sends formal offer of employment to Druyun


Results of the Druyun Case

• Druyun pled guilty to violating 18 USC 208, taking official actions regarding a potential employer. Sentenced to 9 months in jail, 3 years probation, 150 hours of community service, and a $5000 fine.

• Sears pled guilty to aiding and abetting acts affecting a personal financial interest. He was sentenced to four months in prison, a $250,000 fine, and 200 hours of community service.

• The Boeing Company admitted to corruption charges involving conflicts of interest and other unrelated violations.

Boeing settled with the Justice Department for $615 million. $20 billion tanker lease cancelled.


So what is the take-away ?

Public Service is a Public Trust!Or

As Thomas Jefferson once said: “When a man assumes a public trust, he should consider himself as public property.”


Basic Obligations of Government Service:The 14 General Principles

• Hold no financial interests that conflict with your official duties

• Engage in no financial transactions using nonpublic information and do not permit the release of such information for any other improper use

• Make no unauthorized commitments or promises that bind the Government without authority

• Act impartially and not give preferential treatment to any person or entity

• Disclose fraud, waste, abuse and corruption to appropriate authorities


As of:


• Place loyalty to the Constitution and the law above your private gain

• Do not solicit or accept any gift from any person or entity seeking official action from or doing business with any part of DOD

• Do not use your public office for private gain

• Avoid any actions that create the appearance that you are acting unethically, as seen from the perspective of a reasonable person

• Do not engage in, or seek, outside employment or activities that conflict with your official duties


As of:


• Put forth honest effort in the performance of your duties

• Protect and conserve Government property and use only for authorized purposes

• Act in good faith to satisfy the obligations of citizenship (including paying just financial obligations and taxes)

• Adhere to all laws that provide equal opportunity for all Americans regardless of race, color, religion, sex, national origin, age or handicap


Personal Ethics Requirements


Criminal Conflict of Interest Statutes

• 18 U.S.C. 201: Bribery — Prohibits public officials from seeking, receiving or agreeing to accept anything of value for themselves or others in return for being influenced in an official act;

• 18 U.S.C. 205: Forbids employees from prosecuting or assisting in the prosecution of claims against the U.S.; or representing another before a Federal department, agency or court in matters where the U.S. is a party or has a substantial interest.

• 18 U.S.C. 207: Post-Government Employment Restrictions — e.g., One year cooling- off for Senior officials and Lifetime Ban on Representing Back on Matters worked on Personally and Substantially


Criminal Conflict of Interest Statutes

• 18 U.S.C. 208: Financial Conflict of Interest — Bars an employee from participating personally and substantially in an official capacity in any particular Government matter that would have a direct and predictable effect on his own or his family’s financial interests.

• 18 U.S.C. 209: Dual Compensation — Prohibits employees from receiving any salary or contribution to or supplementation of salary from any source other than the United States as compensation for services as a Government Employee.


Financial DisclosureFinancial Disclosure

• Financial Disclosure is required to help ensure that employees do not hold financial interests that conflict with the conscientious performance of duty

• All members of the SES must file a Public Financial Disclosure Report (SF 278)

— Types of Reports: New Entrant (w/in 30 days of appointment), Incumbent (NLT: May 15th), and Termination (w/in 30 days of leaving office)

• Your status as an SF 278 filer also triggers other requirements:

— Complete one-hour of ethics training annually;— Sign annual certification signifying that you

are aware of post-Government employment restrictions — and will not violate them


• SES Managers and Supervisors must also:

• Identify Confidential Financial Disclosure filers (OGE Form 450)

• Ensure timely filing of OGE 450 reports

• Review employee reports to identify any potential conflicts of interests

• Enforce penalties for employee non-compliance

Financial DisclosureFinancial Disclosure


• All individuals in a “covered position”

• At the GS/GM-15 and below level or below the rank of O-7;

AND

• Whose official responsibilities require them to participate personally and substantially in making decisions or exercising significant judgment, and without substantial supervision and review, in taking official action where the final decision may have a direct and substantial economic impact on non-Federal entity interests. (e.g., CO, TMs etc.)

> > >

Who “Must” File an OGE Form 450?Who “Must” File an OGE Form 450?


OR

• Whose SUPERVISOR determines their duties and responsibilities require filing to avoid actual or apparent conflicts of interest.

• All individuals detailed to such positions.

• Individuals identified by procurement regulations.

Who “Must” File an OGE Form 450?Who “Must” File an OGE Form 450?


And the following is a quick reminder about some of the most pertinent Federal Standards of Conduct . . .


Federal Standards of Conduct

• Do Not Use Your Public Office for Private Gain --Examples: Pushing DoD business toward a friend; using official title to promote a book you personally authored

• Do Not Give Unauthorized Preferential Treatment to Any Private Organization or Individual

--Example: Hosting an individual meeting with a Defense contractor if you are not prepared to meet with the

competition

• Do Not Use Your Office, Title, or Position to Support or Endorse a Private Entity

--Example: Official photo and quotation supplied to military magazine extolling virtues of the magazine


Federal Standards of Conduct

• Do Not Participate Actively and Visibly in Fundraising by a Non-Federal Entity in Your Official Capacity

—Examples: You may not serve as honorary chair or sit at head table or stand in receiving line at fundraisers including those that support the troops; you may not be used as “the draw” for such an event

• Do Not Serve on Any Outside Board or Activity in Your Official Capacity — Personal Capacity Only

—Examples: AFCEA and similar professional associations that relate to your official duties

• Do not misuse Govt resources

—Examples: personnel, vehicles, email


Federal Standards of Conduct — Gift Rules

• Gifts from Outside Sources – general prohibition on acceptance of gifts given because of your DoD position or from a prohibited source.

5 C.F.R. § 2635, Subpart B

• Prohibited Source is an entity seeking official action or business with the agency

• Almost anything of value is a gift, although there are many exceptions to the rule


Standards of Conduct — Gift Rules

• Gifts Between Employees – General prohibition on acceptance of gifts from subordinates or people who make less than you.

--exception: gift valued at $10 or less to mark special occasion

• Obama Ethics Pledge – Prohibits accepting any gift from registered lobbyist

--Pledge applies only to full-time political appointees


How do you, as a senior official, maintain a strong ethics climate throughout your organization?

• Lead by example – this has the strongest impact of all• Do not tolerate “minor” ethical or moral shortcuts• Do not “look away” from ethics or moral mistakes• Speak up when you see problems – large or small• Understand that “knowing tolerance” = Approval• Encourage subordinates to help you spot issues• Encourage subordinates to help you reach answers• Enforce all the programs that emphasize high standards

of conduct and respect for all• Publicly recognize and reward integrity

Setting the Ethics Climate in Your Organization


Contact InformationContact Information─ ─ DoD SOCO DoD SOCO ──

Contact InformationContact Information─ ─ DoD SOCO DoD SOCO ──

Director: Leigh Bradley

SOCO Staff Attorneys:• Jeff Green• Eric Rishel• Karen Dalheim• Erica Dornburg• Detailee: Navy LT Christopher Ray

Email: SOCO@dodgc,osd.mil

Website: http://www.dod.mil/dodgc/defense_ethics

Tel: (703) 695-3422

Fax: (703) 695-4970


The character that takes command in moments of crucial choices has already been determined. It has been determined by a thousand other choices made earlier in seemingly unimportant moments. It has been determined by all the little choices of years past — by all those times when the voice of conscience was at war with the voice of temptation — whispering the lie that it really doesn't matter. It has been determined by all the day-to-day decisions made when life seemed easy and crises seemed far away — the decisions that, piece by piece, bit by bit, developed habits of discipline - or of laziness, habits of self-sacrifice — or of self-indulgence, habits of duty and honor and integrity — or dishonor and shame.“

— Ronald Reagan, The Citadel, May 15, 1993

“The Character that Takes Command . . .


Questions?

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