possible conflict.

Reviews by Army and Air Force, did not go

beyond the applicability and completeness of the forms.

In response to a question about the extent of efforts made to verify the accuracy and completeness of the information, we stated there were no procedures in effect after the initial

review.

We found no reported instances of failure to file the required form. In addition, there was a procedure to identify contractors who meet the $10 million dollar negotiated contract threshold for employee filing, and these contractors were notified by DoD to remind their employees of the statutory requirement to file a post-DoD employment.

We concluded our report to Senator Percy with a recommendation to increase the dollar salary floor for employee filing from the current $15,000 year level, and suggested a more effective form, and mandated reviews.

FUTURE WORK

With regard to financial disclosure statements filed by current employees of the Department, we plan to carefully review the revisions to DoD Directive 5500.7 agreed to by the General

I am

Counsel office in response to our December 1984 report. told by the General Counsel's staff that the revised directive is almost ready to be circulated for comment within the Department of Defense.

The General Counsel also agreed, as a result of our work for Senator Percy, to assist in making some revisions to the DoD Directive 7700.15 governing the forms required for post employment reporting by former officials. I am told the new directive will require more information about a person's specific duties during and after Government employment. It will also require mandated reviews of the accuracy of the data reported. Again, we will carefully review this revised directive when it is circulated for, comment.

As for future audit work, we plan to defer to the General Accounting Office which is continuing its review of the accuracy of the specific information provided by former employees of the Department.

Mr. Chairman, that is the end of my prepared statement. I would be happy to answer any questions you or the members of your committee may have.

Senator COHEN. Before concluding the hearing this morning, I'd like to publicly thank Susan Collins and Mary Gerwin of the subcommittee staff. They've done a good job in working with all of you to accumulate this information and make it possible to even have an exploration of the issues involved. We're deeply grateful to them.

The committee will stand adjourned.

[Whereupon, at 12:20 p.m., the subcommittee was adjourned to reconvene at the call of the Chair.]

ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD

TITLE IV OF THE ETHICS IN GOVERNMENT ACT OF 1978, PUBLIC LAW 95-521, AS AMENDED BY PUBLIC LAW 98-150

TITLE IV-OFFICE OF GOVERNMENT ETHICS

OFFICE OF GOVERNMENT ETHICS

SEC. 401. (a) There is established in the Office of Personnel Management an office to be known as the Office of Government Ethics. (b) There shall be at the head of the Office of Government Ethics a Director (hereinafter referred to as the "Director"), who shall be appointed by the President, by and with the advice and consent of the Senate. Effective with respect to any individual appointed or reappointed by the President as Director on or after October 1, 1983, the term of service of the Director shall be five years.

AUTHORITY AND FUNCTIONS

SEC. 402. (a) The Director shall provide, in consultation with the Office of Personnel Management, overall direction of executive branch policies related to preventing conflicts of interest on the part of officers and employees of any executive agency, as defined in section 105 of title 5, United States Code.

(b) The responsibilities of the Director shall include

(1) developing, in consultation with the Attorney General and the Office of Personnel Management, rules and regulations to be promulgated by the President or the Director pertaining to conflicts of interest and ethics in the executive branch, including rules and regulations establishing procedures for the filing, review, and public availability of financial statements filed by officers and employees in the executive branch as required by title II of this Act;

(2) developing, in consultation with the Attorney General and the Office of Personnel Management, rules and regulations to be promulgated by the President or the Director pertaining to the identification and resolution of conflicts of interest;

(3) monitoring and investigating compliance with the public financial disclosure requirements of title II of this Act by officers

and employees of the executive branch and executive agency offcials responsible for receiving, reviewing, and making available financial statements filed pursuant to such title;

(4) conducting a review of financial statements to determine whether such statements reveal possible violations of applicable conflict of interest laws or regulations and recommending appropriate action to correct any conflict of interest or ethical problems revealed by such review;

(5) monitoring and investigating individual and agency compliance with any additional financial reporting and internal review requirements established by law for the executive branch;

(6) interpreting rules and regulations issued by the President or the Director governing conflict of interest and ethical problems and the filing of financial statements;

(7) consulting, when requested, with agency ethics counselors and other responsible officials regarding the resolution of conflict of interest problems in individual cases;

(8) establishing a formal advisory opinion service whereby advisory opinions are rendered on matters of general applicability or on important matters of first impression after, to the extent practicable, providing interested parties with an opportunity to transmit written comments with respect to the request for such advisory opinion, and whereby such advisory opinions are compiled, published, and made available to agency ethics counselors and the public;

(9) ordering corrective action on the part of agencies and employees which the Director deems necessary;

(10) requiring such reports from executive agencies as the Director deems necessary;

(11) assisting the Attorney General in evaluating the effectiveness of the conflict of interest laws and in recommending appropriate amendments;

(12) evaluating, with the assistance of the Attorney General and the Office of Personnel Management, the need for changes in rules and regulations issued by the Director and the agencies regarding conflict of interest and ethical problems, with a view toward making such rules and regulations consistent with and an effective supplement to the conflict of interest laws;

(13) cooperating with the Attorney General in developing an effective system for reporting allegations of violations of the conflict of interest laws to the Attorney General, as required by section 535 of title 28, United States Code;

(14) providing information on and promoting understanding of ethical standards in executive agencies; and

(15) developing in consultation with the Office of Personnel Management and promulgating such rules and regulations as the Director determines necessary or desirable with respect to the evaluation of any item required to be reported by title II of this Act. (c) In the development of policies, rules, regulations, procedures, and forms to be recommended, authorized, or prescribed by him, the Director shall consult when appropriate with the executive agencies affected and with the Attorney General.