The STANDARDS of CONDUCT SYSTEM

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The STANDARDS of CONDUCT SYSTEM
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The STANDARDS of CONDUCT SYSTEM
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CREDITS

• PRODUCERS/INSTRUCTORS

PROPS
Erin Allen Debbie Holland Ray Dunlap
Bill Daley Ken McDonald Barbara Coen Maureen
Villarreal Bill Cerbone
TECHNICAL ADVISORS
SOUND EDITOR
Allyssa Wheaton-Rodriguez Bill Loftus
Chris Kinnear
PRODUCTION DESIGN
Vickie Spinks
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Office of General Counsel

• Helen R. Kanovsky, General Counsel
• Bill Daley, Regional Counsel
• Associate Regional Counsels for Ethics Ken
  McDonald, Barbara Coen, Maureen Villarreal, and
  Bill Cerbone

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Criminal Conflicts of Interest

• Financial 18 U.S.C. 208
• Employees cant participate in matters affecting
• their personal financial interests
• Or fin. interests of spouse, minor children, gen.
  partners, organizations in which employee is
  serving as officer, director, or employee
• -For example, you cant evaluate the bid of a
  spouse to do mowing at HUD properties.
• Or fin. interests of anyone employee is
  negotiating with for employment

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Criminal Conflicts of Interest

• Representational 18 U.S.C. 203 205
• Limit representational activities by employees
  before federal agencies/courts
• Can represent self or immed. family before fed.
  agencies/courts (w/approval)
• Post Employment 18 U.S.C. 207
• Cant represent new employer on previous HUD
  work (lifetime ban)
• Cant represent new employer on previous HUD work
  supervised (2 years)

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Important Statutes Regulations

• Post employment - Procurement Integrity
• Entity w/HUD contract over 10M offers job to HUD
  employee
• Hatch Act Political dos donts
• Dont personally engage in fundraising
• Dont put up partisan campaign posters in the
  workplace
• U.S. Office of Special Counsel enforces the Hatch
  Act (www.osc.gov)
• The HUD Reform Act of 1989
• Dont disclose info in applications for HUD funds
  prior to funding decision
• Anti-lobbying Restrictions 18 U.S.C. 1913
• Employees cant lobby Congress using appropriated
  funds
• Dont write your Congressman on HUD equipment

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Important Statutes Regulations

• Travel-related Rules Regulations
• Government credit card can only be used for HUD
  travel
• Communications with Registered Lobbyists about
  Recovery Act Funds
• If receive a communication about Recovery Act
  matters, ask if
• the communication is from a federally
  registered lobbyist. 
• If it is, then certain restrictions apply and
  the communications
• must be documented in a particular
  manner.
• Offer to Fund Travel From Non-Federal Sources
• Is a gift to the Department and not the employee
• Must be approved by General Counsel the Deputy
  Secretary

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Government-wide Standards of Ethical Conduct 5
C.F.R. Part 2635

• Gifts from outside sources
• Dont accept gifts from someone who does business
  with
• HUD unless the gift fits within one of the
  exceptions to the
• no gift rule
• If dont know what a gift is worth, need to find
  out
• If you wouldnt take it if a TV crew was
  watching, dont take it
• Gifts between employees
• Dont give gifts to supervisor unless the gift
  fits within
• one of the exceptions to the no gift
  rule

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Government-Wide Standards of Ethical Conduct 5
C.F.R. Part 2635

• Impartiality in official duties
• Cant prefer one private entity over another
• For example, dont recommend a particular law
  firm
• or CPA
• Misuse of Position
• Cant use federal position to benefit yourself
  or
• someone else
• For example, dont ask for relative to be
  moved up on
• Section 8 waiting list.
• Outside Employment/Activities (Paid or
  Volunteer)
• Cant conflict with official position
• Can swing a hammer for an organization
  receiving
• HUD funds, but cant sit on board.

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• HUD Standards of Ethical Conduct
• 5 C.F.R. Part 7501

• Prohibited Outside Activities
• REAL ESTATE BUSINESS ACTIVITY
• Employee may not actively participate in real
  estate business
• For example, cannot gather information about
  visitors to a
• model home for a realty company
• INVESTMENTS
• HUD-related investments restricted for employee,
  spouse
• and minor child
• For example, cannot own FNMA or FHLMC securities

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HUD Standards of Ethical Conduct

• HUD Mortgage Insurance
• Insurance only on the employee's principal
  residence
• and, under very limited circumstances, one
  other
• single family residence
• Buying HUD Owned Homes
• Restrictions are set out in HUD Housing Notice
  05-10
• If employee is eligible, may only be purchased
  for use as the employees principal residence

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HUD Standards of Ethical Conduct

• Prior Approval Requirement for Certain Paid or
  Unpaid Employment
• Employment in same professional field as HUD
  position
• (for example, a HUD lawyer writing a will)
• Employment with organization which directly or
  indirectly receives HUD assistance
• Employment with a state or local government

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Contest Coming! Fun during ethics
training??? Priceless
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WARNING
Everyone in the illustrations is a HUD employee
unless the slide or I tell you otherwise.
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Illustration

• It's a tough month for two supervisors. Rudolph
  is in the hospital for a nose job, and Snowman is
  melting under the pressure of deadlines.
• Under the ethics rules
• (a) The employees are limited to spending 10
  apiece
• for get well gifts for Rudolph
• (b) The employees are limited to spending 20
  apiece
• for get well gifts for Rudolph
• (c) The employees can "pool" funds to buy
  Snowman
• a gift for Boss's day
• (d) Both (a) and (c)
• (e) None of the above.

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Answer

• The answer is (e).
• There is no limit on gifts for special,
  infrequent occasions such as hospitalizations,
  marriages, births, adoptions or retirement.
  Employees should not pool funds for a gift for
  Bosss day.

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Illustration

• Bret Fahre got an offer to work for Viking Homes
  when visiting Greenbey, one of its HUD projects.
  He turned it down, but had second thoughts and
  has called Viking to explore their offer. Under
  the ethics rules
• (a) Bret can work on Viking projects until Viking
  gives him a firm
• offer
• (b) Bret should notify his supervisor that he
  needs to be recused from Viking work
• (c) Bret can supervise an employee working on
  Viking projects,
• but cannot do direct work on Viking
  matters
• (d) Bret cannot ever work for Viking
• (e) None of the above.

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Answer

• The answer is (b).
• An employee should not touch matters pertaining
  to anyone with whom they are discussing possible
  employment. Brets supervisor needs to
  intercept any Viking matters.

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Illustration

• Pilgrim inherited a beat up house in Plymouth
  Rock. He plans to fix up this turkey while
  continuing to rent it to the current tenant, Hee
  Gobbles. Under the ethics rules
• (a) Pilgrim can continue to rent the property to
  Hee Gobbles even if he is a Section 8 tenant
• (b) Pilgrim can continue to rent the property to
  Hee Gobbles only if he is not a Section 8 tenant
• (c) Pilgrim's goose is cooked unless he
  immediately sells the property, because he would
  be in a real estate business
• (d) None of the above.

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Answer

• The answer is (a).
• As a general rule, a HUD employee cannot receive
  Section 8 as a landlord. There are a few
  exceptions, such as where an employee inherits a
  property which already has a Section 8 tenant.
  However, when that tenant moves out, a new
  Section 8 tenant cannot move in.

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ILLUSTRATION

• Walter Melon has been approached by Kantee Lope
  Bank about putting on a joint event about FHA
  home loans. They think it will be a juicy
  event which will produce good results. Under
  HUD's rules
• (a) HUD can co-sponsor this event if Kantee
  charges no fee for participants
• (b) HUD can co-sponsor this event if the
  registration fee will only cover Kantee's
  expenses
• (c) HUD can co-sponsor this event if it "pairs"
  up with a nonprofit instead
• (d) HUD can co-sponsor this event if both Kantee
  and a nonprofit participate and there is no
  registration fee
• (e) both (c) and (d).

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ANSWER

• The answer is (c).
• HUD's policy on co-sponsoring events indicates we
  will not co-sponsor an event with a "for profit"
  entity.

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ILLUSTRATION

• Gecko, a paralegal in OGC, has been doing
  bookkeeping for Caveman, Inc. and for a city
  while off duty. Under the ethics rules
• (a) Gecko needs ethics approval for the Caveman
  work, but not the city work
• (b) Gecko needs ethics approval for the city
  work, but not the Caveman work
• (c) Gecko needs ethics approval for both jobs
• (d) Gecko does not need ethics approval for
  either job.

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answer

• The answer is (b).
• Employees need prior approval to work for a local
  or state government. He would need approval for
  both jobs if he was a HUD accountant.

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ILLUSTRATION

• Furr Aball is a volunteer for Puppy, Inc. a
  non-profit organization. Puppy wants to apply to
  the DOD to convert an old army building into an
  animal shelter. Under the ethics rules
• (a) Furr can sign the application on behalf of
  Puppy
• (b) Furr can't advocate for Puppy with the DOD,
  but can work at the shelter
• (c) Furr can't communicate with the DOD, and must
  immediately sever all ties with Puppy
• (d) Furr can't put a notice on HUD's bulletin
  board about adopting animals from Puppy.

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ANSWER

• The answer is (b).
• Criminal statutes limit representational
  activities by government employees before federal
  departments, agencies, and courts. Accordingly,
  Furr cannot represent Puppy before the DOD,
  either in person or by written communication
  which she signs.

ALERT Furr can represent herself or her family
before the federal government (w/approval).
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ILLUSTRATION

• Barbie convinced her co-workers to select Matell
  to provide software to HUD. Barbie's husband,
  Ken, works for Matell and gets commissions from
  sales to HUD. Barbie lied to her supervisors
  about the date Ken began working for Matell and
  sent an internal HUD email to Ken about a
  possible sale to HUD.
• (a) Barbie may be criminally prosecuted for a
  felony conflict of interest under 18 USC 208
• (b) Barbie may be criminally prosecuted for wire
  fraud
• (c) Barbie may be criminally prosecuted for
  making a false statement to HUD
• (d) all of the above
• (e) both (a) and (c), but not (b).

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ANSWER

• The answer is (d).
• This example was based loosely on an actual
  criminal case.

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ILLUSTRATION

• Cindy Lou, a new employee at the Whoville office,
  went last night to a gathering hosted by the
  Grinch Housing Authority. The Whobeast dinner
  was valued at 25, and she was given a 10 mug
  and a 5 pen which she wants to keep. Under the
  ethics rules
• (a) Cindy must pay the HA 40
• (b) Cindy must pay the HA 30
• (c) Cindy must pay the HA 25
• (d) Cindy must pay the HA 20
• (e) Cindy needs to pay nothing.

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ANSWER

• The answer is (c).
• You can't accept a gift over the limit by paying
  part of its value. She can keep the mug and pen,
  because they are under the 20 limit for a single
  occasion (assuming she hasn't received other
  gifts this calendar year over 30 total from the
  Grinch).

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HATCH ACT QUESTIONS

• The following are true/false questions.
• Both sides will simultaneously have a chance to
  answer them (the spokespersons should hold up
  their answer when I say to).
• Note that high level HUD employees may have
  different Hatch Act restrictions than those
  mentioned today.

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True or false

• Eagar Beever can display a bumper sticker on his
  car for a Senate candidate.

VOTE FOR SENATOR
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ANSWER

• TRUE, but if Eagar takes his car on a HUD trip,
  he should cover up the bumper sticker.

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TRUE OR FALSE

• While off-duty, Bruce Moose can address a
  political convention in support of a candidate
  for governor.

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answer

• True. Off-duty employees can make campaign
  speeches so long as the employees do no
  fundraising as a part of the speech, the speech
  is not on federal property, and the employee is
  not wearing anything referring to HUD.

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True or false

• Survay, who works in Multifamily Housing, can
  accept an appointment to the local zoning board.

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ANSWER

• FALSE. There is too much of a potential for
  conflict with HUD here.

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TRUE OR FALSE

• Tommy Tortoise can go door to door in his
  neighborhood asking people to vote for A. Hare, a
  candidate for the State House.

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answer

• TRUE, but he should not be wearing anything with
  a HUD logo.

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TRUE OR FALSE

• Bukworm can run for a seat on the local library
  board since none of the candidates are affiliated
  with a political party.

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answer

• TRUE, the Hatch Act permits this.
• However, Bukworm must notify Regional Counsel and
  obtain written approval before running, because
  this is required by a HUD regulation.

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• BOTH SIDES WILL HAVE THE CHANCE TO
  SIMULTANEOUSLY ANSWER THE FOLLOWING MULTIPLE
  CHOICE QUESTIONS.

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ILLUSTRATION

• Cliff works in a big HUD office. His wife, Clare
  Uxtable, has a daycare business called Rug Rats R
  Us. Under the rules
• (a) Cliff can send email to all employees in his
  office offering them a discount
• (b) Cliff can post a Rug Rats flyer on the
  bulletin board listing his work extension
• (c) Cliff can use the HUD fax machine to send a
  one page billing notice to a parent
• (d) Cliff can send a one page billing notice via
  email to a parent during a break
• (e) None of the above.

RUGRATS R US DAY CARE
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ANSWER

• The answer is (e).
• HUD equipment cannot be used for an outside
  business, even on a limited basis. A bulletin
  board notice should list only non-work phone
  numbers and addresses.

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ILLUSTRATION

• Lep Rakaun Homes Company asks Lucky Lou to
  provide a letter of recommendation to Pot of Gold
  Bank for a non-HUD project. Lou worked with Lep
  Rakaun on some HUD projects.
• Under the ethics rules
• (a) Lou can't provide a recommendation for the
  company
• (b) Lou can provide the letter on HUD letterhead
  using his HUD title
• (c) Lou can provide the letter without using HUD
  letterhead or his HUD title
• (d) Lou can provide a verbal recommendation
• (e) Both (c) and (d).

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ANSWER

• The answer is (a).
• With certain exceptions, an employee cannot use
  his Government position to endorse any product,
  service or business.
• If you get a request for a recommendation for an
  individual, please contact our office for ethics
  advice.

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ILLUSTRATION

• Conan supervised Lenno from 2006-2008 on a
  project called NBeeC owned by Foxy. Conan
  never directly touched anything pertaining to
  Foxy for HUD.
• Under the ethics rules can Conan go to work in
  2010 for Foxy and act as Foxy's representative to
  HUD on NBeeC?

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answer

• Yes, because Conan never worked on NBeeC and
  did not supervise Leno during his last year at
  HUD. A former supervisor, for two years after
  leaving HUD, cannot communicate to a federal
  agency on behalf of a new employer on a matter
  which was under his supervision during his last
  year at HUD.

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ILLUSTRATION

• Poe Tato, a new HUD employee, is in a stew. She
  has received an invitation to an evening dinner
  honoring a local housing authority official and
  doesn't know if she can go. Under the ethics
  rules
• (a) She can attend only if she doesn't eat the
  20
• steak dinner
• (b) She can go only if she pays the cost of the
  dinner
• (c) She can attend and eat the dinner and pay
• nothing
• (d) She must turn down the invitation.

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ANSWER

• The answer is (c ).
• The general rule is that an employee may accept
  unsolicited gifts having an aggregate market
  value of 20 or less from any one source per
  occasion, provided that the aggregate market
  value of individual gifts received from any one
  person shall not exceed 50 in a calendar year.

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ILLUSTRATION
Bugz Bunnie and Wily Coyote received an
invitation from Elmer Fudge Mtg., a HUD lender,
to attend its large May 4-5 conference for free
(usual cost 50). Bugz is also invited to the
May 5th mechanical wabbit widing contest (usual
cost 25). Bugz would speak on behalf of HUD the
first day. Wily is just going to attend the
conference.

• Under the ethics rules
• (a) Bugz can pay nothing if he only attends the
  first day
• (b) Bugz must pay 25 to participate in the
  contest
• (c) Wily has to get ethics approval to attend
• (d) All of the above.

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ANSWER

• The answer is (d).
• Bugz doesnt need ethics approval to attend just
  the first day if he has approval from his
  supervisor to speak on behalf of HUD. If Wily
  wants to attend for free, then he must request
  permission from Regional Counsel. Bugz doesnt
  need permission to go to the wabbit widing
  contest , but he must pay the entry fee.

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When in Doubt?Check it Out!

• Contact your Agency Ethics
• Official to Resolve a Question
• or Conflict