Army Guard Reserve (AGR) Legal Conference

Mark VetterAssociate Deputy General Counsel (Ethics & Fiscal) /

Program Manager, FDM26 August 2014

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Topics (Fire Hose Approach)

• Recent Headlines• Senior Official Front Office Exportable

Training Package• STOCK Act• Section 847 and AGEAR• What’s New in Gifts• Contractor Recognition• Conferences• NTV Use to Air Terminals

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Recent Headlines

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Pentagon reviewing legal, ethical conduct of senior officersBy Craig Whitlock, Washington Post, November 12, 2012

“The Pentagon has launched a sweeping review into misconduct by senior officers, Defense Secretary Leon E. Panetta announced Thursday, a rare undertaking at the nation’s largest bureaucracy, beset by recent high-profile scandals involving the brass… ‘As has happened recently, when lapses occur, they have the potential to erode public confidence in our leadership,’ Panetta wrote in a directive to Gen. Martin E. Dempsey, the chairman of the Joint Chiefs of Staff, … ‘Worse, they can be detrimental to the execution of our mission to defend the American people.”

Military brass, behaving badly: Files detail a spate of misconduct dogging armed forcesBy Craig Whitlock, Washington Post, January 26, 2014

Hagel: Pentagon to get an ethics officerBy Ernesto Londono, Washington Post February 8, 2014

“Stung by a string of embarrassing revelations about misconduct in the ranks, the Pentagon will appoint a senior officer to enforce a culture of ethical behavior and good moral character, Defense Secretary Chuck Hagel said Friday.”

Recent Headlines

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“Each of us must rededicate ourselves to upholding the principles of sound leadership. Our culture must

exemplify both professional excellence and ethical judgment.” – SECDEF Memo dated 26 March 2013

• Message on Professionalism From the Secretary Hagel and GEN Dempsey: http://www.youtube.com/watch?v=nfMzjXzIWD4

Senior Official Front Office Exportable Training Package

• Slide training package developed by DAIG and OTJAG, intended to be used as a collective training event

• SecArmy Initiative• Collective training event is to be moderated by the GO• SJA or Ethics Counselor should be prepared to support• Intended for the GO’s personal/support staff (e.g., Chief

of Staff, XO, SGS, Aide, Enlisted Aide, Secretary, SJA, Protocol Officer, Command IG, G-8/RM)

• Contains vignettes drawn from real world allegations• Package has been distributed (see USARC OSJA)

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Stop Trading on Congressional Knowledge (STOCK) Act

• Pub. L. No. 112-105 (2012), as amended by Pub. L. 113-7 (2013)

• Important Provisions for OGE 278 Filers:– Section 6: New Periodic Transaction Reporting

Requirement (OGE 278-T) – Section 13: Personal Mortgage Reporting for GOs – Section 17: Requirement to Give Notice of

Employment Negotiations and Agreements

• OGE 278-T is due the EARLIER of 45 days after the transaction or 30 days after notice of the transaction. 6

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Calculating 278-T Filing Deadlines

Extensions and Late Fees• OGE recommends monthly filing on 15th of the month to ensure

timely filing• Monthly reminders to OGE 278 filers about the OGE 278-T may be helpful

• Filing extensions of up to 90 days may be granted for OGE 278-T filing before or AFTER the transaction

• The authority to grant extensions has been delegated to USARC SJA • Check with USARC OSJA or your higher headquarters OSJA to determine

whether it has been further delegated• Standard for granting extension is “good cause” • Combat Zone extension available

• $200 fine for late reporting• Assessed per reporting period, not per transaction• OTJAG is the waiver authority for late filing fees• Standard for granting waiver is “extraordinary circumstances” 8

OGE 278-T Filing Procedures• No e-filing – filer signs the OGE 278-T manually or digital • Filer provides to ethics counselor for review with a copy

to the supervisor• Supervisor does not need to sign

• Local ethics counselors will perform a conflict of interest review and sign as Intermediate Reviewing Official

• Scan and forward the OGE 278-T to the USARC OSJA for final certification

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OGE 278-Ts: USAR Considerations• Reserve officers are considered to be Special Government

Employees, except those serving on voluntary extended active duty in excess of 130 days

• Reserve GOs file a 278 once the Officer serves on active duty for more than 60 days in a Calendar Year (CY)

• SGEs become subject to the 278-T requirement once they have served more than 60 days in a CY

• Accordingly, Reserve GOs become subject to the 278-T requirement once they have served more than 60 days in a CY

• The reporting requirements apply to any transaction occurring both on or after the 61st day in a CY, and before the end of the CY. This includes all reportable transactions, whether or not the filer was on active duty on the day the transaction occurred 10

Personal Mortgage Reporting• General Officers must report mortgage liabilities on

personal residences in the OGE 278– Not required to report the location of personal

residence• How to report in FDM

– In liabilities section, select “Other” for Type of Liability and enter the text “Personal residence mortgage”

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13Slide courtesy of Army FDM Office

Notice of Employment Negotiations

• OGE 278 filers may not directly negotiate or enter into an agreement of future employment or compensation unless they file a notification statement within three business days

• Must execute a recusal statement when there is the potential for a conflict of interest

• OGE Legal Advisory (LA-12-01) provides a template • File notification with the ethics counselor• Recusal statement should be distributed as currently done• Maintain locally

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Section 847 & AGEAR• Section 847 of the FY 08 National Defense

Authorization Act requires that certain current and former DoD officials, who expect to receive compensation from a defense contractor within two years of leaving DoD, request and receive a written opinion from their ethics counselor regarding the applicability of post-employment restrictions prior to accepting compensation.

• Defense contractors may not knowingly provide compensation to a covered official without first determining that the former official sought and obtained a written ethics opinion.

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Routine PGE opinions

Section 847 opinions

AGEAR is a very narrow scope application used specifically and ONLY for legal opinions required under Section 847. The routine PGE world is much larger.

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Section 847 & AGEAR

• Director, DoD SOCO, memo, 15 Apr 14: – Ethics counselors need only look back at the final two

years of the departing DoD employee’s career to determine if a Section 847 opinion is required.

– The 30 day clock is not triggered until the requestor provides sufficient information about a specific position, including identity of future employer, duty position, and job duties.

• Ethics counselors should still provide general advice, but not in AGEAR pursuant to Section 847.

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Section 847 & AGEAR• Army General Counsel Memo, 14 Mar 14. Army

ethics counselors must:– Issue timely Section 847 legal opinions.– Properly process opinion requests in AGEAR in order to create a

credible audit trail.– Upload all Section 847 opinions into AGEAR, including historical

opinions (written before AGEAR became mandatory on 1 Jan 12)

• Business Rules for AGEAR– Must reject AGEAR requests that do not meet Section 847 criteria. – Don’t “game” the system by waiting until the last moment to start the

clock by clicking “prepare opinion” in AGEAR.

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Opinion requests: https://www.fdm.army.mil/AGEAR (public; no login required).

Ethics Official site to act on the request as assigned: https://www.fdm.army.mil/AGEAREO (restricted access; login required – same as FDM).

What’s New in Gifts

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DTM 14-004• Directive Type Memorandum (DTM) 14-004 issued on 17 Apr 14. • Interim implementing guidance to gift authority granted in 10

USC 2601a that permits covered personnel, their family members, and survivors to accept unsolicited gifts for injuries and illnesses that are combat-related or incurred “under circumstances warranting similar treatment” as determined by the Secretary concerned (e.g., the Ft. Hood or Washington Navy Yard shootings). http://www.dtic.mil/whs/directives/corres/pdf/DTM14004_2014.pdf– Expires 17 Apr 15. Will be replaced by a DoD Instruction.

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DTM 14-004• Ethics review and approval required with the following findings:

– The gift is not offered in a manner that specifically discriminates among covered members or employees on the basis of type of official responsibility or favors those of higher rank or pay.

– The donor does not have interests that may be affected substantially by the performance or nonperformance of the covered member’s or employee’s official duties.

– Acceptance would not cause a reasonable person with knowledge of the relevant facts to question the integrity of DoD programs or operations

• Permits covered personnel, their family members, and survivors to accept unsolicited gifts for injuries and illnesses that are combat-related or incurred “under circumstances warranting similar treatment” as determined by the Secretary concerned (e.g., the Ft. Hood or Washington Navy Yard shootings). 24

Gifts to Enlisted Soldiers• Sec Def Memo, dated 16 May 13, waived standard of conduct

prohibition on accepting gifts from outside sources for Soldiers in ranks of E-6 and below. – Soldiers may accept gifts, other than cash, from charitable

and veterans service organizations that are tax exempt pursuant to 26 USC 501(c)(3),(19), and (23).

– Includes Reservists and National Guard– May not accept gift where intent is to influence or is an

improper supplementation of salary.– Gifts may not be solicited. – The change will be incorporated into the Joint Ethics

Regulation. 25

Minimal Value Raised for Foreign Gifts

• “Minimal Value” threshold for gifts from foreign governments accepted under the Foreign Gifts and Decorations Act raised to $375 as of 1 Jan 14.

• Gifts under this threshold may be accepted by Government personnel

• If higher than “Minimal Value,” OAA, HQDA must process gift. Becomes property of Army. Option to purchase gift possible. (OAA POC: Mr. George Cannizzaro, (703) 697-3067)

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New DoD Guidance on Contractor Recognition

• DoDI 1400.25-V451, November 4, 2013, DoD Civilian Personnel Management System: Awards –– Enclosure 3, para. 11.b.(2): To avoid issues in connection with

contractual relationships and obligations, actual or perceived conflicts of interest, and actual or perceived acts of favoritism, persons, organizations, or companies having a commercial or profit-making relationship with the DoD or with a DoD Component will not be granted recognition. The single exception is if the contribution is deemed to be unrelated to and completely outside any contractual relationship with DoD and the recognition is clearly in the public interest. Recognition is limited to a letter or a certificate of appreciation to the individual or to the organization signed at the lowest applicable level of the organization. (Emphasis added) 27

Speaking in Official Capacity at Non-Federal Event (1 of 2)

• Senior officials may receive frequent invitations to speak at non-Federal events

• Joint Ethics Regulation allows speaker and panel support to non-Federal entity conferences and events under certain conditions (See JER para. 3-211a)

• Same speaker support must be provided to similar non-Federal organizations upon request

• Generally, an employee must make a speech or panel presentation in order to attend in an official capacity and use Government transportation to attend, IAW guidance from the U.S. Office of Government Ethics 28

• Conference fee for attendance may not be unreasonable ($722 a day rule if more than 20% of speakers are from DOD (DOD SOCO Guidance and Army OGC Memo, 16 Apr 07))

• New requirements under DOD/Army Conference Policy• Fundraisers: Official speech only on Army subjects, no

participation in fundraising (e.g. cannot ask for donations or stand in receiving line), and a general officer cannot be the draw for the event)

Speaking in Official Capacity at Non-Federal Event (2 of 2)

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A Few Words On Conferences

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“The chief of the General Services Administration resigned, two of her top deputies were fired and four managers were placed on leave Monday amid reports of lavish spending at a conference off the Las Vegas Strip that featured a clown, a mind reader and a $31,208 reception.” - Washington Post, 2 April 2012

Army Conference Policy (1 of 3)• Significant restrictions implemented as a result of the

Congressional and public scrutiny on conference spending

• Current Policy: Army Directive 2014-01– Determination must be made if it is a Conference and

whether or not it is exemptible– Requester must certify and prove attendance is

mission-critical – Army speakers at non-Federal conferences cannot be

greater than 50% of all speakers unless approved as a co-sponsorship 31

Approval Authorities• General:

– If Army costs are greater than $500,000, conference is prohibited without waiver from SA/USA

– SA/USA approval required if conference is Army-hosted and involves Government-funded spousal travel (regardless of cost)

• Army-Hosted Conferences:– CSA, VCSA, CGs of FORSCOM, TRADOC and AMC and AASA may

approve Army-hosted conferences up to $500,000– CGs of DRUs and ASCCs, ACOMs, and HQDA Principal Officials may

approve Army-hosted conferences up to $100,000– CG, USARC is not a conference approval authority; must go to CG,

FORSCOM

Army Conference Policy (2 of 3)

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Approval Authorities (cont.)• Non-DoD Conferences

– SA/USA for non-DOD-hosted conference if Army costs are $50,000 or higher

– CSA, VCSA, CGs of FORSCOM, TRADOC and AMC and AASA may approve non-DOD-hosted conferences up to $50,000

– CGs of DRUs and ASCCs, ACOMs, and HQDA Principal Officials may approve non-DOD-hosted conferences up to $10,000

– CG, USARC is not a conference approval authority; must go to CG, FORSCOM

Army Conference Policy (3 of 3)

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Conferences – Other Issues• Co-sponsorships must be approved at HQDA (at

OAA, OGC and OTJAG)• Problem Areas

– Co-sponsorships & conferences held “in conjunction with” an NFE event

– Support staffs unaware of Army conference policy requirements

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Conferences – Legal Review Required• A legal review is required that addresses all fiscal, ethics,

contracting and travel issues, including a comprehensive assessment of whether the conference complies with applicable regulations and Army Policy. Any legal objections must be mitigated before submission of the conference requirement.

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New Reasonable Fee for JER 3-211• DoD SOCO Advisory No. 14-01, 18 Apr 14

– The “reasonable attendance fee” under JER 3-211.a(7) for DoD employees to attend a conference where DoD personnel will be speaking has been raised to $722 per day from $675.

– The highest rate charged to any attendee (including late fees) will be used as the benchmark.

– The $722 per day figure may be adjusted upward by the percentage amount by which the per diem rate for the conference location exceeds that for Washington, D.C. No downward adjustment.

• For example, if an NFE conference will be held in New York City and the per diem rate for New City is 15% higher than that for Washington, DC, the reasonable daily fee for the New York event would be $830 ($722 x 15% = $108 + $722 = $830). No downward adjustment is required where the per diem rate for the NFE event location is less than Washington, DC.

– Exception for “Incidental” DoD participation i.e., less than 20%.

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Non-Tactical (NTV) Use is Restricted for Trips to Air Terminals (Revision of AR 58-1)

• NTVs owned or controlled by DOD may be used for trips between domiciles or places of employment and commercial or military air terminals only when at least one of the following conditions is met:

(1) Used to transport official non-DOD visitors invited to participate in DOD activities, provided that this use does not impede other primary mission activities;

(2) Used by individuals authorized domicile-to-duty transportation, for example, SECARMY or CSA – [Note: no one in USARC];

(3) Necessary because of emergency situations or to meet security requirements;

…

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Non-Tactical (NTV) Use is Restricted for Trips to Air Terminals (Revision of AR 58-1)

(cont.)(4) Terminals are located in areas where other means of transportation are not

available or cannot meet mission requirements in a responsive manner; *(5) Authorized in the Pentagon Area (formerly referred to as the National Capital

Region) by Department of Defense Administrative Instruction (AI) 109.AR 58-1, paras. 2-3i, 4-6 (12 June 2014)

*All modes of transportation listed in AR 58-1, para. 2-1b must be considered before use of GOV Sedan/SUV is permissible (by operation of DoDD 4500.36-R (Management, Acquisition, and Use of Motor Vehicles), 16 March 2007, para. C.2.5.3.2.3). This requires considering (in order): (1) Scheduled public transportation(2) POV (reimbursable)(3) Taxi (reimbursable)(4) Scheduled DoD Bus Service(5) DoD Motor Vehicles

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Finally - A Cautionary Tale

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Summary of DoD IG Findings• Use of MILAIR for personal travel• Extending official travel for personal reasons • Excessive travel expenses, excessive expenses for change of

command mementos, excessive expenses to plan a holiday party, misuse of ORFs

• Permitted staff members to do personal errands for himself and his spouse

• Permitted staff members to use official vehicle to drive his spouse to unofficial events

• Unreimbursed and undocumented spouse travel on MILAIR• Accepted gifts from a prohibited source

• Ethical Principle Implicated• Use of public office for private gain • Obligation to protect and conserve Government property

Result – GEN Ward stripped of 4th Star and ordered to re-pay $82K

On the Horizon

• Before the next on-site, be looking for new guidance on:– New(er) Army Conference Policy– Official spouse travel– Use of enlisted aides by GOs– JER update– OGE review of Standards of Conduct Regulation

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Questions?

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