Conflicts of interest: Unresolved questions

Although government and industry are partners in their work, the two see conflict-of-interest rules quite differently. Even if there is agreement on a basic approach to regulating the conflicts, many questions linger.

Should personal conflicts be treated separately in regulation, or combined with organizational conflicts?
Traditionally, the conflicts of interest have been addressed separately, but Cheryl Howe, a procurement analyst representing the Health and Human Services Department, suggests a novel approach.
“Why should we not require the company to be responsible for its employees’ personal conflicts of interest?” Howe asks. “From the government’s point of view, the distinction between a company’s organizational conflict of interest and its employees’ personal conflicts of interest is inconsequential.”

However, other groups, including the Professional Services Council, recommend keeping them separate. Not every organizational conflict of interest involves a personal conflict, and vice versa, said Alan Chvotkin, executive vice president of the council.

Should there be special rules for on-site and off-site employees?
Transportation Department officials say yes. Joanie Newhart, senior contracting executive, and Rosalind Knapp, deputy general counsel at DOT, suggest guidelines specifically for on-site employees to deal with access to government information gathered that is “beyond the scope of the contract,” and to deal with “reliance on workplace contractors for noncontract matters.”

Other experts suggest the location of the employee is not a key factor.

How far should contractor disclosure rules go?
The DOT officials also recommend that as part of a strategy to reduce personal conflicts of interest, contractors should be required to adopt provisions in their ethics programs that address such issues as financial interests of spouses and employment of close friends and other family members.

However, too much disclosure can be unworkable and detrimental to privacy, driving contractors out of the market, according to the Information Technology Association of America.

“This is the sort of terrain that will be especially problematic,” said David Laufman, partner at Kelley Drye and Warren.

About the Author

Alice Lipowicz is a staff writer covering government 2.0, homeland security and other IT policies for Federal Computer Week.

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