Finally, a PEIP staff member counsels each participant 30 to 60 days after he starts his assignment to verify his position description and to remind the participant of the conflict of interest rules (III-7c). These procedures are contained in the PEIP manual, receipt of which must be acknowledged by the participant, and in a special "Check List for Avoiding Conflicts of Interest," which is maintained on each participant.

NOTE.-III-6, 7a, b, c above refers to attached conflict of interest procedures.

Once the participant begins work, he is subject to the general conflict of interest rules and regulations of the agency where he is working, which are applicable to program and non-program participants alike. In general, all the agency regulations studied conformed to the requirements of Executive Order 11222 and chapter 735 of the Federal Personnel Manual, which contain even more stringent requirements than those prescribed by the title 18 sections in question. (For example, 18 U.S.C. § 208(a) describes conflicts as arising when an employee "participates personally and substantially" in a matter in which there is a forbidden financial interest. The Executive Order, on the other hand, forbids even "apparent" conflicts of interest under certain circumstances.

At any rate, with regard to the Chairman's concern with implementation of section 208 (a) and (b), we refer to the following provisions of published agency regulations which we believe implement the statutory sections in question. Environmental Protection Agency.-See subparts B and C. and Appendix A, B and C of chapter 1, part 3 of title 40, Code of Federal Regulations.

Section 3.303 (a) and (b) describes the procedures for offering the necessary waiver of potential conflicts pursuant to 18 U.S.C. § 208(b). Appendix C contains a general waiver for certain categories of financial interests, applicable to all employees.

Department of State.-See generally part 10, chapter 1 of title 22, Code of Federal Regulations.

Subpart D deals generally with the requirements for disclosure of financial interest statements. Section 10.735.408 provides procedures for reviews of disclosure statements, and for written summaries and decisions by a specially desigated counselor. In addition, there are special provisions applicable to economic and financial activities by employees or members of their families abroad. (See sec. 10.735-206.)

Federal Energy Administration.-See part 203, chapter II, title 10 of the Code of Federal Regulations.

Although FEA has the most extensive regulations dealing specifically with the 18 U.S.C. § 208(b) exemption procedures, most of these procedures became effective on October 1, 1974, after we had begun our review.

Department of Commerce.-See generally part O, subtitle A, title 15 of the Code of Federal Regulations.

Subpart G, entitled "Administration," deals specifically with the respective responsibilities of employees to obtain the necessary prior written authorizations (Sec. 0.735-35) and the operating units and counselors to review and provide the necessary approvals (Sec. 0.735-36-41.)

Department of the Treasury.-See part O, subparts A and B, and Appendix A, subtitle A, title 31 of the Code of Federal Regulations.

Section 0.735-79 describes the procedures for review of conflict of interests statements filed by regular employees, by the General Counsel, with a special provision for further consideration by an Advisory Counsel on Ethical Standards. Section 0.735-212 (c) permits "ad hoc" exemptions to be made by certain designated officials for special Government employees, advisors and consultants. In addition, special restrictions are placed on Treasury employees stationed in foreign countries. (see subpart C).

AVOIDING CONFLICT OF INTEREST

Adequate measures are taken to avoid placing Interchange Executives in positions which would create conflicts of interest. The following practices are used as they apply to individual placements.

1. The compensation of appointees from the private sector cannot be supplemented by their companies during the period of Federal employment (see page 10, second paragraph regarding Title 18 of the U.S. Code, Sections 209 (a) and (b)).

2. Appointees may be required to submit a Statement of Employment and Financial Interest for review by the Office of Legal Counsel, U.S. Department of Justice, before assignment. This applied to the appointees from government as well as those from business.

3. Before final designation of work assignments, the Commission will again review the tentative assignments to ensure that appointees are not placed in situations which might lead to conflicts of interest. When deemed necessary, these assignments will be formally cleared by the agencies general counsel office or by the private business general counsel office.

4. A representative of the host organization will make continuing reviews to assure avoidance of potential conflicts of interest. If at any time the representatives determine that a conflict of interest appears to be developing, they will immediately consult with their agency's or company's general counsel and, if necessary, recommend a change in work assignment to the Commission. PRESIDENT'S COMMISSION ON PERSONNEL INTERCHANGE EXECUTIVE INTERCHANGE PROGRAM PROCEDURES FOR AVOIDING CONFLICTS OF INTEREST

The staff of the President's Commission on Personnel Interchange advises all candidates for participation in the President's Executive Interchange Program of the Commission's policy on avoiding conflicts of interest, and that participation in the program must be free of any conflict of interest or appearance of conflict of interest.

1. When acknowledging receipt of nomination to the Company, the Commission requests the Company to review the applicability of State conflict-of-interest statutes, if any.

2. At its initial interview with the candidate, the Commission advises him of the conflict of interest statutes, gives him a copy of its publication "Compliance with the Laws on Conflict of Interest", and secures from him a written acknowledgment that he has received a copy of this publication. The statutory provisions and the provisions of Executive Order 11222 are discussed with him.

3. The Commission reviews the candidate's background with him in relation to the assignments for which he may be considered to ascertain whether they would present conflict or potential conflict of interest situations. Assignments that may present a conflict or appearance of conflict are eliminated from consideration with respect to the candidate.

4. After the candidate has been interviewed by host agencies for assignments initially determined to present no potential conflict of interest problems, the Commission again interviews him. If in his interviews with any host agency information was developed indicating the possibility of a conflict of interest in any assignments tentatively considered, such assignments are eliminated from further consideration at this interview.

5. When a host organization offers the candidate a position, the Commission requests the General Counsel of the host organization to review the candidate's background and relate it to the formal position description, as well as to any work the candidate may actually be doing that is not reflected in the position description, to determine once again whether potential exists for conflict of interest in the appointment.

The Commission requires each participant in the Executive Interchange Program, shortly after undertaking his assignment, to attend a one week orientation program conducted by the Brookings Institution by arrangement with the Commission. The General Counsel of the Civil Service Commission discusses with those attending the orientation sessions the philosophy and underlying principles of the conflict of interest laws and regulations, and the need for interchange executives to conduct themselves so that they bring credit upon themselves and the government organizations that sponsors them. They are admonished to be alert to situations that may reflect adversely upon them and upon the government, and to seek advice from the General Counsel of their host organizations whenever they perceive situations presenting potential conflict of interest or the appearance of it. They are advised that they may not accept transfer or detail assignments within their agency, or to other agencies, without the express written approval of the President's Commission on Personnel Interchange.

A member of the Commission staff counsels each participant within 30 to 60 days after he commences his interchange assignment. In addition to verifying his position description, discussing his adjustment to his new environment and similar matters, he is advised once again of the provisions of law and Executive

order on conflict of interest, the possibility of conflict arising in his work, and the need to remain alert to avoid even the appearance of conflict of interest.

CHECKLIST FOR AVOIDING CONFLICTS OF INTEREST

1. Notify private sector sponsor to review applicability of State Conflict of Interest statutes, if any exist---

2. Acknowledgment of receipt of Conflict of Interest statement_

3. Receipt of Host Office of General Counsel assignment review and opinion letter__

4. Attendance by participant in discussion of conflict statutes, philosophy and intent with Civil Service Commission Office of General Counsel__

5. 60-day counseling session___

NOTE. All of the above events are recorded on candidate or nominee checklist under a subsection entitled "Procedures for Avoiding Conflicts of Interest."

Chapter i-Environmental Protection Agency