1. Ethics
ACQ 370

2. Ethics Philosophy
"In order to maintain public confidence in the federal procurement process, government and contractor employees must follow exemplary standards of conduct.”
-- John Cibinic and Ralph Nash
Administration of Government Contracts
Administration of Government Contracts
Fourth Edition

3. Code of Ethics For Government Service

4. Code of Ethics Two Core Concepts
Employees shall not use public office for private gain
Employees shall act impartially and not give preferential treatment to any private organization or individual

5. Code of Ethics
Public service is a public trust, requiring employees to place loyalty to the Constitution, the laws and ethical principles above private gain.
Employees shall not hold financial interests that conflict with the conscientious performance of duty.
Employees shall not engage in financial transactions using nonpublic Government information or allow the improper use of such information to further any private interest.
An employee shall not, except as permitted by subpart B of this part, solicit or accept any gift or other item of monetary value from any person or entity seeking official action from, doing business with, or conducting activities regulated by the employee's agency, or whose interests may be substantially affected by the performance or nonperformance of the employee's duties.
Employees shall put forth honest effort in the performance of their duties.
Employees shall not knowingly make unauthorized commitments or promises of any kind purporting to bind the Government.
Employees shall not use public office for private gain.
Employees shall act impartially and not give preferential treatment to any private organization or individual.

6. Code of Ethics
Employees shall protect and conserve Federal property and shall not use it for other than authorized activities.
Employees shall not engage in outside employment or activities, including seeking or negotiating for employment, that conflict with official Government duties and responsibilities.
Employees shall disclose waste, fraud, abuse, and corruption to appropriate authorities.
Employees shall satisfy in good faith their obligations as citizens, including all just financial obligations, especially those—such as Federal, State, or local taxes—that are imposed by law.
Employees shall adhere to all laws and regulations that provide equal opportunity for all Americans regardless of race, color, religion, sex, national origin, age, or handicap.
Employees shall endeavor to avoid any actions creating the appearance that they are violating the law or the ethical standards set forth in this part. Whether particular circumstances create an appearance that the law or these standards have been violated shall be determined from the perspective of a reasonable person with knowledge of the relevant facts.
Standards of Ethical Conduct for Employees of the Executive Branch
5 C.F.R. Part 2635

7. Discussion
Jake’s long-time friend and neighbor brought a very expensive gift to his 50th birthday party. She works for a company that is seeking a permit from Jake’s agency.
Jake has sought out your advice. As the Ethics Counselor at the Agency, what do you tell Jake?

8. Laws and Regulations Executive branch employees are subject to
Statutes enacted by Congress
Executive orders issued by the President
Ethics regulations issued by the US Office of Government Ethics
Supplemental ethics regulations issued by some agencies for their employees

9. Laws and Regulations Selected Ethics Laws and Regulations
18 U.S.C. § 201: Bribery of public officials and witnesses
5 U.S.C. app. 4 §§ : Outside earned income and activities
18 U.S.C. § 203: Compensation to Members of Congress, officers, others in matters affecting the Government
41 USC § 423: Procurement Integrity Act (PIA)
5 C.F.R., Part 3601: Supplemental Standards of Conduct for Employees of the Department of Defense
18 U.S.C. § 205: Activities of officers and employees in claims against and other matters affecting the Government
5 CFR 2635 Subpart B: Gifts From Outside Sources
18 U.S.C. § 207: Restrictions on former officers, employees, and elected officials of the executive and legislative branches
5 CFR : Fundraising Activities
5 CFR : Gifts Between Employees
5 CFR : Conflicting Financial Interests
18 U.S.C. § 208: Acts affecting a personal financial interest
5 CFR : Impartiality in Performing Official Duties
18 U.S.C. § 209: Salary of Government officials and employees payable only by United States
5 CFR : Seeking Other Employment
5 U.S.C. app. 4 §§ : Public financial disclosure requirements

10. Office of Government Ethics
Laws & Regulations
Legislative Branch
Executive Branch
Judicial Branch
Senate Select Committee on Ethics House Committee on Standards of Official Conduct
Office of Government Ethics
Judicial Committee on Codes
of Conduct Office of the General Counsel Administrative Office of the
US Courts

11. The Joint Ethics Regulation

12. The Joint Ethics Regulation
The Joint Ethics Regulation (JER) DOD R
Single source of standards of ethical conduct & ethics guidance for DoD
OSD Office of General Counsel, Standards of Conduct Office

13. The Joint Ethics Regulation
DoD policy
Employees shall become familiar with – and comply with – all ethics provisions, including the standards set out in E.O
DoD employees shall become familiar with the scope of – and authority for – the official activities for which they are responsible
Sound judgment must be exercised
DoD employees must be prepared to account fully for the manner in which that judgment has been exercised
-- DoD R (JER), Chapter 1

14. The Joint Ethics Regulation
Personal Conflicts of Interest
A personal interest or relationship, as defined by law or regulation, that conflicts with the faithful performance of official duty
O'Neill v. Department of Housing and Urban Development, 220 F.3d 1354 (2000)
Violations: Misuse of Government property.
Representation to Government Agencies.
The initial dismissal did not address time and attendance policies. Also, on appeal, the Court sided with the employee that she was not an “agent” of the non-profit operation although she was petitioning on their behalf. The term “agent” was narrowly construed to be a person with authority to act on behalf of another. The dismissal was upheld based on the other charges against her.

15. The Joint Ethics Regulation
Personal Conflicts of Interest
Employee may not participate in a matter that would affect the financial interests of
Self, spouse, or minor child
An organization in which he is serving as officer, director, trustee, general partner or employee
An organization with which he is negotiating for employment or has an arrangement for future employment
(18 USC 208)
18 U.S.C. 208

16. Restrictions on Obtaining and Disclosing Certain Information (Procurement Integrity Act)

17. Bans disclosing or obtaining procurement information
Restrictions on Obtaining and Disclosing Certain Information (Procurement Integrity)
Bans disclosing or obtaining procurement information
Contractor bid or proposal information
Source selection information
Ban applies to current and former Federal employees and contractor employees
Requires procurement official disclosure of contacts regarding possible employment with contractors
One-year ban for certain personnel accepting employment or compensation from contractor
-- 41 U.S.C. 21

18. Restrictions on Obtaining and Disclosing Certain Information (Procurement Integrity)
General focus areas:
Contractor bid or proposal information
Cost or pricing data
Indirect costs and direct labor rates
Proprietary information about manufacturing process, operations, or techniques identified as such by any contractor
Information identified by any contractor as "contractor bid or proposal information"

19. Source selection focus areas:
Restrictions on Obtaining and Disclosing Certain Information (Procurement Integrity)
Source selection focus areas:
Bids or prices submitted by offerors
Source selection plans
Technical evaluation plans
Technical evaluations of proposals
Cost or price evaluations of proposals
Competitive range determinations
Rankings of bids, proposals or competitors
Reports and evaluations of source selection panels, boards or advisory councils
Other information marked as “source selection information”

20. Restrictions on Obtaining and Disclosing Certain Information (Procurement Integrity)
Maximum penalty:
Five years in prison
Adverse personnel action (e.g., termination)
Civil penalty for individual: $50,000 for each violation plus 2x amount received or offered
Civil penalty for organization: $500,000 for each violation plus 2x amount received or offered

21. Business Ethics and Conduct
Contractor Code of
Business Ethics and Conduct

22. Contractor Code of Business Ethics
Government Contractors
Must conduct themselves with the highest degree of integrity and honesty
Should have a written code of business ethics and conduct
Should have an employee business ethics and compliance training program
Suggested or for guidance – notice the work “should”
Found at FAR 3.102
-- FAR

23. Contractor Code of Business Ethics
FAR Clause “Contractor Code of Business Ethics and Conduct”
Requires government contractors to:
Exercise due diligence to prevent and detect criminal conduct
Promote an organizational culture that encourages ethics and compliance
Submit mandatory disclosures to the government
Mandates:
Code of business ethics and conduct
Business ethics awareness and compliance program
Internal control system
Subcontractor flowdown

24. Contractor Code of Business Ethics
Standards of Conduct
Contractors and personnel must abide by standards of conduct as established by contract, statute, and regulation
Violations could result in contractors being subjected to criminal, civil, administrative, and contractual remedies

25. Organizational Conflict of Interest
Three types of OCI
Unequal Access
E.g., contractor has an unfair competitive advantage due to working relationship with the government
Biased ground rules
E.g., contractor involved in writing Statement of Work then seeks to submit a proposal to fulfill that requirement
Impaired objectivity
E.g., support contractor performs duties involving assessing or evaluating itself or a partner company
-- FAR Subpart 9.5

26. Organizational Conflict of Interest
More likely to occur in contracts involving:
Management support services
Consultant or other professional services
Contractor performance of or assistance in technical evaluations
Systems engineering and technical direction work
Mitigation plans must be developed before any contract is awarded
-- Johnson Controls World Services, Inc.,
B , 2001

27. Conclusion

28. Conclusion
Know your ethics counselor and the Joint Ethics Regulation (JER, DoD R)
Contact your supervisor and ethics counselor when questions/concerns arise
Report fraud, waste and abuse to the appropriate investigative agency and/or to the Procurement Fraud Working Group

29. Conclusion We have laws against murder − murders happens
We have laws against speeding − speeding happens
We have laws against
WHAT IS THE ANSWER?

30. The Answer
Living a life that matters doesn’t happen by accident. It’s not a matter of circumstance but of choice. What will matter is every act of integrity, compassion, courage or sacrifice that enriched, empowered or encouraged others to emulate your example. Choose to live a life that matters.

31. Assignment Read the case of “Ms. Friendly”
There will be teams assigned as Ms. Friendly’s defense counsel
There will be teams assigned to bring charges against Ms. Friendly
All teams are required to provide substantive justification for their position to include cases and/or particular reference to the JER
Each side will have a chance to rebut the charges/ positions of the other team
Team members will be randomly selected to present