government ethics laws and rules for va researchers

JUN12 Department of Veterans Affairs 1

Government Ethics Laws and Rules for VA Researchers

Office of General CounselProfessional Staff Group III


TRAINING TOPICS

• INTRODUCTION• CONFLICT OF INTEREST• GIFTS• MISUSE OF GOVERNMENT

RESOURCES• TRAVEL RULES• OUTSIDE ACTIVITIES• POST GOVERNMENT EMPLOYMENT


Why Attend Training?

• Memorandum from Under Secretary for Health dated 30 January 2006– Requires annual Government ethics training for:

• All part-time and full-time physicians• All part-time and full-time pharmacists• All researchers – including scientists, nurses and other

allied health personnel whose research could result in new pharmaceuticals and/or medical devices

• All part-time and full-time physicians in training

– VHA will work with OGC to fulfill this requirement


Why Follow the Rules?

• Public service is a public trust

• Employees must place loyalty to the Constitution, the laws and ethical principles above private gain

• Maintain public’s confidence in VA and the Federal Government


Why Get Ethics Advice?• Avoid penalties – Safe Harbor

– Imprisonment– Civil fines– Removal from Federal employment– Other administrative punishment

• Be able to explain your actions– Supervisor or IG– Congress or media

• Caveats:– Get advice in writing– Tell the whole story truthfully


The Rules

• Conflict of interest laws18 U.S.C. §§ 201-209

• Standards of Ethical Conduct for Employees of the Executive Branch

5 C.F.R. Part 2635

• 14 General Principles5 C.F.R. § 2635.101(b)


Conflict of Interest Laws• Criminal statutes – create prohibitions

– No official participation in certain matters that affect employees’ outside financial interests

– No bribery – No representing non-Government parties

in matters in which Government is a party or has a substantial interest

– No supplementation of Government salary by non-Government entity


Standards of Ethical Conduct

• Promulgated by Office of Government Ethics pursuant to two Executive Orders

• Provide Government-wide guidance for standards of ethical conduct

• Ensure that every citizen can have complete confidence in the integrity of Federal Government


The 14 General Principles• Apply to every employee of the Executive

Branch• Foundation principles• Two predominant concepts:

– Do Not Use Your Public Office for Private Gain – Do Not Give Unauthorized Preferential

Treatment to Any Private Organization or Individual


Hypothetical #1

• Dr. Rich Stocker, VA researcher and clinician, has an idea for a new use of a drug manufactured by BigDrugCo. He wants BigDrugCo to fund a VA study under a Basic Science CRADA.

– Dr. Stocker holds $14,000 worth of BigDrugCo shares and his 12-year old daughter holds $10,000– any problem?

Financial Conflict of Interest

Federal Government employees are prohibited from participating personally and substantially as part of official duties in a particular matter that has a direct and predictable effect on their financial interests or the financial interest of their spouse, minor child, outside employer, or certain others.

18 U.S.C. § 208JUN12 Department of Veterans Affairs 11

Financial Conflict of Interest

• Your Financial Interest

• Your VA Duties



What to Do When Faced WithConflict of Interest

• Seek advice from a VA Government Ethics official who will determine if conflict exists and help to resolve

• Resolve conflict:– Recusal – do not participate– Exemption or exception might apply– Reassignment– Divestiture– Waiver


Conflict Exemptions• Exemption for employee’s financial interest

in a particular matter where interest is:

– $15,000 or less in a publicly traded company

– $25,000 or less in a nonparty or matter of general applicability

– $50,000 or less for sector fund (aggregating similar funds)

Conflict of Interest 208 (b) – Waiver

18 U.S.C. § 208(a) – It is a crime to have a conflict of interest in your official duties

18 U.S.C. § 208(b) – It is not a crime to have a COI in your official duties, if you get a waiver first.



Waiver given by the official responsible for your appointment (VAMC Director).

You must: – Request a waiver in writing; – Fully disclose the financial interest; – Receive written determination;– That the interest is not so substantial as to be

likely to affect the integrity of the service the Government may expect.



At VA – ask Regional Counsel for referral to ethics attorney/Deputy Ethics Official

You will work with Ethics official to:– Draft the request for waiver– Ensure waiver determination is factually accurate

Ethics official will:– Draft the determination with your input– Consult with Office of Government Ethics – Provide concurrence

New and expedited process is in place. JUN12 Department of Veterans Affairs 17


Conflict of Interest

• Dr. Stocker (hypothetical #1) is facing a conflict of interest– Particular matter (study agreement)– Personal and substantial participation– Direct and predictable effect on his financial

interest. • Falls outside exemption

– Aggregate value of stock held by him and his minor daughter exceeds $15,000

• Recuse, choose to sell, or seek waiver



• Do the laws and rules of conflict of interest apply to researchers at VA under a Without Compensation (WOC) appointment?



• Yes – a researcher under a WOC appointment is considered a VA employee subject to all of the laws and rules of Government Ethics.

• May a VA researcher conduct further VA research on a licensed invention owned solely, and patented by, VA?


• Yes.

• May a VA researcher conduct VA research on a licensed invention owned and patented by the VA researcher (i.e. royalty flowing from non-Federal entity)?




• No• The Government-employee researcher

may not participate (conduct research) in a particular matter (licensed invention) that will have a direct and predictable effect on his own financial interest

• A waiver of the criminal conflict of interest should be sought under 208(b)


• May a VA researcher conduct further VA research on his invention owned jointly by VA and the university-affiliate and licensed by the university if VA researcher– is solely VA employee or VA WOC?– holds in-name-only appointment at Univ?– is salaried employee of university?



• VA employee-inventor entitled to future inventor’s royalties has a disqualifying financial interest in the invention.

• Gray area – point at which the disqualifying financial interest arises– At time of invention?– At time of patent?– At time of license?– At time of royalty flow?



• Prudent course – if want to conduct further research into your invention or into area that could affect your invention, first obtain 208 waiver

• If royalty is already flowing, MUST obtain 208 prior to further research




• What if a VA researcher starts his own company to license an invention owned by VA?

– May he continue to research the invention at VA?



• No• The VA researcher may not continue to

research the invention without a 208 waiver • Likelihood of one in this circumstance is

very small.

• Can he consult for a company that is licensing his invention (under a license with the university affiliate) if he holds no ownership interest in the company and is not researching the invention at VA?



• Yes. The VA researcher may consult for the licensee under the facts – may not use government time, facilities or equipment

• Must maintain clear delineation between VA job and consulting job – cannot be paid by another to do his government job (18 U.S.C. §209)

• Seek advice – each factual situation is different


• May a VA employee who is a consultant or in a speaker’s bureau for a pharmaceutical company conduct VA research that benefits that pharmaceutical company?



• No.• The VA researcher is prohibited from

participating in a matter that could affect his financial interest. His financial interest is consulting fees. He affects the ability or willingness of the pharmaceutical company to continue to hire him as a consultant or speaker by conducting the research. 18 U.S.C. § 208




• Can the VA researcher who is also a University-affiliate employee, request that part of his VA research be contracted to:

– himself at the University?– his spouse at the University?– another University employee?


VA DAP will be considered a university“employee” if has university appointmentand receives disqualifying“compensation” from university



• Disqualifying “compensation” – benefits of significant monetary value:– Wages– Salary– Other taxable benefits:

• University contributions to life insurance• Disability insurance• Retirement plans• Subsidized tuition benefits for employee/family



• Faculty perks of minimal value not considered “compensation”:– Parking permits– Library access– Admissions to artistic and athletic events– Access to online university resources– Office space– Royalty payments




• VHA Handbook 1660.03– Conflict of Interest issues raised by

contracting with University-affiliate under certain situations

– Certain contracts authorized by statute• Scarce medical specialist services• Health care resource sharing• Enhanced use lease• Intergovernmental Personnel Act



• Conflict of Interest issues raised– Sole source allowed – no need to bid– Physician and manager DAPs have

financial interest in the University– Conflict of interest law prohibits

participation in matters that will affect your financial interest or financial interest of your employer (i.e. the University)

– Rules for these contracts spelled out in VHA Handbook 1660.03



• VA physician/clinician DAP shall not:– Draft specifications or solicitations– Act as COTR– Negotiate any part of the contract– Evaluate bids or proposal– Select or recommend the contractor– Review, certify or approve the contract itself– Evaluate contractor performance– Review time and attendance for contract

administration purposes



• VA physician/clinician DAP may:– Supervise professional service to ensure quality

of care– Develop workload projections– Develop specific research task– Provide direct patient care within VA

responsibilities– Perform oversight of professional service– Participate in a matter where neither University

nor employee has financial interest



• VA researcher DAP who is university employee may not recommend that his research be contracted to himself, his spouse or any other University employee

– VA researcher may request contracting officer procure certain service not available within VA

– Request must not be for a specific entity or researcher, etc.


• May VA researcher seek an NIH or other Federal grant for himself as a university researcher on behalf of his university research?



• Federal employees are prohibited from representing another, with or without compensation, before a Federal Executive branch agency or Federal court in matters where the U.S. is a party or has a substantial interest

18 U.S.C. §§ 203 and 205



• VA employees may not represent university before Federal agencies including VA

• Grant application may indicate VA employee is PI

• VA PI may sign grant application indicating undertakes responsibilities as PI



• Non-Federal employee who is university employee must sign and advocate grant application

• ALTERNATIVELY VA employee could seek grant through NPC instead of through University– Depends on capability of NPC



• VA DAPs applying for NIH grant through university must have MOU between university and VA

• MOU in general defines VA DAP’s work distribution between VA and university



• VA signatory of MOU:– may not earn disqualifying

“compensation” from university– may not plan to earn university salary

under NIH grant that will fall under MOU

• Research conducted at university and research conducted at VA under the grant must be distinguishable



• Federal employees are prohibited 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.

18 U.S.C. § 209


Conflict of Interest• You may work for both the University

and VA, but NOT at the same moment in time– Need strict accounting of time– Need to use VA computer systems and

email when on VA time– Be aware of need to segregate VA research

from non-VA research– Data issues – authority to give VA data to

othersJUN12 Department of Veterans Affairs 47



• Seeking employment– Once you have started seeking

employment with a prospective employer, you may not take any official action that could affect the financial interest of that prospective employer.

18 U.S.C. § 2085 C.F.R. § 2635.604


Hypothetical #2

• Dr. Pepper Tide has an idea for a VA basic research study involving a drug already on the market. She contacts the pharmaceutical company to discuss the possibility of it funding her research. The company suggests that they continue discussions over dinner at an upscale restaurant – at the company’s expense. Can she dine?


Gifts From Outside Source

• RULE: You may not directly or indirectly solicit or accept a gift given:– by a prohibited source; or – because of your official position.

5 C.F.R. 2635.202(a)Examples of prohibited sources:

VA contractors VeteransPatients VendorsPharmaceutical Co. Veterans Service

Organizations


Gifts From Outside Sources

• Is it a Gift?

– “Gift” is an item of monetary value, including any gratuity, favor, service, discount, entertainment, or hospitality

5 C.F.R. § 2635.203



• Not a “gift”

– Loans or discounts available to the general public

– Greeting cards and plaques of little intrinsic value

– Modest food or refreshments• Coffee and donuts – not a meal



• Exceptions to Prohibited Gifts– Unsolicited gift from prohibited source

with value of less than $20• No more than $50 per year from one source

– Gifts based on personal relationship– Gifts based on spouse employment

• Always acceptable to refuse a gift!


Gifts from Outside Source• Offered dinner to Dr. Tide is a gift• Pharmaceutical company is prohibited

source• Dr. Tide may attend dinner if value is

under $20 – pizza anyone?• Dr. Tide may pay her own way

– Okay to refuse a gift– Appearances might indicate refusal as

safer option• Drug samples are gifts


Hypothetical #3

• While discussing possible research with Dr. Tide, the pharmaceutical company invites Dr. Tide to attend (for free) a local conference that it is sponsoring and would like Dr. Tide to then stick around and talk to company executives about marketing strategies.


Non-Federal Travel Support

• As a VA employee, you may not solicit or accept reimbursement for official travel and related expenses from any source other than the Government

except…



• EXCEPTION: an unsolicited offer of travel support from a non-Government entity for attendance at a meeting or similar function that has been appropriately approved by your Supervisor and Ethics Counsel.

31 U.S.C. § 1353



• Your Supervisor must agree:– it is in VA’s interest that you attend– Travel relates to your official duties

• Non-Federal source must not be disqualified by conflict of interest

• Approval must include review by an appropriate ethics official

• Use VA Form 0893


May Dr. Tide Attend Conference?

• Gift to VA of cost of conference if she attends in official capacity

• Authority to accept gift under 31 U.S.C. § 1353 only if employee is in travel status– Facts indicate Dr. Tide not in travel status

• Authority to accept gift under 5 U.S.C. §4111 only if donor is tax-exempt 501(c)(3) organization

• General gift acceptance authority – difficult to use


May Dr. Tide Attend the Conference?• May Dr. Tide attend off-duty?

– Only Agency Officials with delegated authority may approve acceptance of non-Federal entity offers of free attendance at a conference, seminar, etc. that you are attending in your personal capacity.

– If:• The offer was unsolicited• Your Supervisor articulates how

attendance is in VA’s interest because it will further VA’s programs and operations

5 C.F.R. § 2635.204(g)(2)


Gifts from Outside Sources

• Supervisor must agree that Dr. Tide is attending in personal capacity, but attendance is in VA’s interest because it furthers VA’s programs and operations – policy decision.

• Supervisor may choose to allow Dr. Tide to attend on excused absence

• Supervisor may determine that “sticking around to discuss marketing strategies” is not part of conference, is not in VA’s interest and will not be allowed on excused absence– Permissible on own time


• What if Dr. Tide is a VA-University dual-appointed personnel (DAP), and the University offers to pay her attendance at a conference in Las Vegas on a medical topic in her field of expertise. She wants to attend and represent both the University and VA. She submits a VA Form 0893 for acceptance of the gift of travel from the University.

• Any problems? Is answer different if she plans to present her university research at the conference?



• By using VA Form 0893, Dr. Tide and her supervisor are indicating that she is traveling on official duty. She must have a travel authorization through FedTraveler.

• She may not travel in an Authorized Absence status because that is not an official duty status.



• A Federal employee shall use official time in an honest effort to perform official duties 5 CFR 2635.705

• A Federal employee shall not use or permit the use of his Government position/title/authority to imply VA sanction or endorsement of his personal activities or those of another 5 CFR 2635.702



• Dr. Tide may not represent University while on official VA duty

• Whether she may attend in official capacity is a programmatic decision, but plans to present University research is evidence that trip does not further VA programs and operations, but is rather for benefit of University



• What if the VA NPC offers to pay for Dr. Tide’s official travel to conference in Las Vegas?

• No problem provided:– She travels in official duty status– With travel authorization– To a meeting, training or other conference– Uses VA Form 0893 for advance review of

giftJUN12 Department of Veterans Affairs 66


Hypothetical #4

• Dr. Rogers, VA clinician and researcher has a little side internet business selling diet supplements. On his website, he uses ads that endorse his product by quoting himself and ascribing the quote to “Dr. Rogers, Chief of Internal Medicine, VAMC Smallville.” He also likes to photocopy his business pamphlets and invoices at VA.

• Problems?


Misuse of Position

• You must avoid improper use of your official title to state or imply official endorsement or sanction of any non-Federal entity, its products, services, or activities.

• Outside the performance of your official duties, your official title may be used only in limited purposes such as providing biographical information.


Use of Government Resources

• Employees shall protect and conserve Federal property and shall not use it for other than authorized purposes.

5 C.F.R. § 2635.101(b)(9)

– Supervisor may authorize use of copier, email, telephone and the like if of little additional expense to VA• Never allowed to use Government resources

for personal commercial activity


Hypothetical #5

• Dr. Rogers, when performing certain procedures, takes an “extra” tissue sample for “his” research. He stores the tissue in his VA lab. He keeps a log, including personally identifiable information of patients.

• Any problems?


Hypothetical #5, cont’d.

• Non-ethics issues raised– Only VA approved research may be performed at

VA– Creation of illegal database under the Privacy Act,

5 U.S.C. § 552a– Storage of VA data must be in accordance with VA

Handbook 6500– VA rules on tissue banking– Proper Informed Consent and HIPAA authorization– Might be violating terms of CRADA – research

outside scope of Protocol


Hypothetical #5, cont’d.

• Ethics Issues– Misuse of Government resources

• Must protect non-public information• Cannot use non-public information for

personal business, teaching, speaking or writing

– Possible use of public office for private gain

– Possible violation of conflict of interest


Outside Activities

• RULE: You shall not engage in outside employment or any other outside activity that conflicts with your official duties:

– If the activity is prohibited by law or regulation, or

– You would have to recuse yourself from performing official duties to the degree of materially impairing your performance


Hypothetical #6

• Dr. Luna, VA clinician and researcher, wants the VA nonprofit to hire him to work under a WOC appointment back at VA doing the same research he does during his official duty hours.


Outside Activities

• Because one cannot distinguish Dr. Luna’s official duties from his NPC duties, Dr. Luna would run afoul of 18 U.S.C § 209 that prohibits a government employee from being paid by another for performing his official government duties.


Hypothetical #7

• Dr. Mello, VA clinician and researcher is invited to speak at a university conference on diabetes. Dr. Mello has been asked to discuss his VA clinical and VA research experiences in a particular area of diabetes.

• May Dr. Mello receive an honorarium for this talk?


Outside Activities Teaching, Speaking and Writing

• RULE: You may not accept compensation, including honoraria, from a non-Federal source for teaching, speaking or writing that relates to your official duties.

5 C.F.R. § 2635.807



Teaching, speaking or writing relates to official duties when:• Activity is undertaken as part of

employee’s official duties.• Invitation is extended because of:

• position rather than expertise on the subject matter or

• by person whose interests may be affected by your official duties.



Teaching, speaking or writing relates to official duties when the content:

• Includes non-public information• Deals in significant part with

• matter to which you were assigned during the past one-year period or

• with ongoing policy, program or operation



• Dr. Mello may not receive honorarium for speaking related to his official VA duties.

• May Dr. Mello receive compensation for speaking as a guest lecturer at a non-VA affiliated community college class on the medical profession as a career? The presentation will be made during non-duty hours.



• Yes. This presentation does not relate to Dr. Mello’s official duties so he may receive compensation.

• May Dr. Mello, on his own time, be compensated for writing or updating a textbook on the treatment of diabetes?



• Yes, provided the book does not focus on VA research, programs, or specific VA patients, but rather conveys scientific knowledge gleaned from the scientific community as a whole. The book may include treatments or research of diabetes that although occurring at VA, are known to the public.


Post-Government Employment

• Former Federal employee is prohibited from representing another before Government agencies or courts with intent to influence:– On a specific party matter in which employee

participated personally and substantially as part of his official duties

– On a specific party matter under employee’s official responsibility during last year of Government service

– Other matters spelled out in 5 C.F.R. Part 2641


Post-Government Employment

• Representational prohibitions• Not prohibited by post-Government

rules from working for a particular company

• Very fact driven• SEEK ADVICE from an Ethics Official

before you start looking for employment outside the Government


Advice and Guidance

WHAT TO KNOW: When in doubt, ask for advice before taking any action!

WHERE TO GO FOR ADVICE: Contact the Designated Agency Ethics Official (DAEO), Alternate DAEO, in the Office of General Counsel, Regional Counsel, and/or their staff ethics officials with questions.


USEFUL CONTACT INFORMATIONVA Ethics Officials:

• Walter A. Hall, Assistant General CounselDesignated Agency Ethics Official (DAEO)

• Renée L. Szybala, Associate General CounselAlternate DAEO

• Contact Regional Counsel for referral to an ethics attorney/Deputy Ethics Official

• VACO Deputy Ethics Officials:Jane Gutcher, Jonathan Gurland, Chris Britt

Office of General Counsel (023)Tel: (202) 461-7694Fax: (202) 273-6403

14 General Principles

5 C.F.R. § 2635.101(b) - Principles of Ethical Conduct

The following general principles apply to every employee and may form the basis for the standards contained in this part. Where a situation is not covered by the standards set forth in this part, employees shall apply the principles set forth in this section in determining whether their conduct is proper.



• 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.

• 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.


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