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  • SEA Letter Re Stock Act 2-16-12

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    Christopher Dorobek
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    Senior Executive Association writes to the Senate opposing provisions of the STOCK Act https://www.seniorexecs.org/

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    Senior Executive Association writes to the Senate opposing provisions of the STOCK Act https://www.seniorexecs.org/

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    195 views3 pages

    SEA Letter Re Stock Act 2-16-12

    Uploaded by

    Christopher Dorobek
    Senior Executive Association writes to the Senate opposing provisions of the STOCK Act https://www.seniorexecs.org/

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 3

    the voice of career federal executives since 1980

    77 K Street N.E., Suite 2600 Washington, D.C. 20002 (202) 927-7000 Fax (202) 927-5192 www.seniorexecs.org

    February16,2012 TheHonorableHarryReid TheHonorableMitchMcConnell SenateMajorityLeader SenateMinorityLeader 522HartSenateOfficeBuilding 317RussellSenateOfficeBuilding Washington,D.C.20510 Washington,D.C.20510 DearMajorityLeaderReidandMinorityLeaderMcConnell: TheSeniorExecutivesAssociation(SEA)representstheinterestsofcareerfederalexecutivesin government,includingthoseintheSeniorExecutiveService(SES)andinequivalentpositions, suchasSeniorLevelandScientificandProfessionalpositions.Wewritetoexpressstrong concernwiththeprovisionsinS.2038(theSTOCKAct),asamendedbytheHouse,thatwould unnecessarilyanddetrimentallyaffectcareerSeniorExecutives. IntheversionofS.2038aspassedbytheHouse,careerSeniorExecutiveswouldbesubjectto promptreportingoffinancialtransactionsandtheirfinancialdisclosureformswouldbemade publicthroughawebsitemaintainedbytheOfficeofGovernmentEthics(OGE).Section6ofthe billrequiresthatnotlaterthan30daysafterreceivingnotificationofatransaction,Senior Executivesmustfileareportofthetransaction.Section11(b)requiresOGEtocreateapublic websiteanddatabaseoffinancialdisclosurereportsfiledbyexecutivebranchemployees.Each oftheseprovisionsistroublingandunnecessarilyapplicabletocareerfederalemployees. OneofSEAsprimaryconcernswiththeSTOCKActisitsattempttoequatecareerfederal employeeswithMembersofCongress,orevenpoliticalappointees.SEAisunawareof instanceswherecareerSeniorExecutiveshavebeensubjecttoinsidertradingaccusations. Whilewecannotguaranteethatithasnotoccurred,webelievethatoverall,careerSenior Executiveshavelittledesireoropportunitytoengageintheactivitiesaddressedbythe legislation.Moreover,currentreportingrequirementsaresufficienttoaddress,remedyand prosecuteanywrongdoingthatmayoccur. SEAunderstandsthedesiretobringtransparencytothefinancialdisclosuresofpubliclyelected officials.Whatwedonotagreewithisapplyingsuchbroadstandardstocareerfederal employees.Currently,SeniorExecutivesandequivalentseniorlevelemployeesarerequiredto fileannuallyfinancialdisclosurereports(OGEForm278).Althoughnotavailableonapublic website,membersofthepubliccanaccessthisinformationthrougharequestingprocessto

    OGE.Onthatform,theyarealreadyrequiredtoreportpurchase,salesandexchangeofstocks, bonds,commodityfuturesandothersecuritieswhentheamountexceeds$1,000. AsfarasSEAisaware,therearenodocumentedproblemswithaccesstothisinformationor withthedisclosuresthemselves.Thecurrentsystemprovidesthenecessaryoversightand transparencytoensurecareerSeniorExecutivesaremakingproperfinancialdisclosures. AttemptstobroadenpublicaccessasdictatedthroughtheSTOCKActappeartobeasolutionin searchofaproblem. Requiringfinancialdisclosureformstobepubliclyaccessibleandsearchablethroughawebsite raisesahostofissues.Firstandforemost,itappearstobeagrossviolationofthespiritofthe PrivacyAct.Asyouknow,thePrivacyActof1974waspromulgatedtoregulatefederal governmentrecordkeepinganddisclosureandrecognizesinstanceswhereinformationshould beexemptfromdisclosure.WhilethepubliccanaccessOGEForm278,wecanenvision legitimatereasonswhymakingfinancialdisclosureformsoffederalemployeessoreadily availabletothepubliccouldnotonlyhurtanindividualsrighttoprivacy,butcouldalsoprove outrightharmful.Forinstance,ForeignServiceofficersorotherfederalemployeesserving abroadcouldcomeundereasyscrutinybyforeigninterests,includingterrorists.And supervisorswithinafederalagencycouldbesubjecttounwarrantedpersonalscrutinybytheir subordinates,causingtensionandproblemsintheworkplace. Otherconcernswithadisclosurewebsitearemoretechnical.ItappearstoSEAthatitwouldbe acomplexundertakingforOGEtocreatethetypeofwebsiteproposedinthelegislation. Further,wesuspectthatextensiveresources(bothfundingandpersonnel)wouldberequired tocreatesuchadatabase.Giventhecurrentbudgetclimate,wequestionwhetherthisisan appropriateuseofOGEsresources.Finally,webelievethesenewrequirementsandthe databaseitselfwouldengenderanincreasedlevelofrequestsforethicsguidancebyfederal employeestoOGE,puttingastrainonOGEsethicsofficialsanddesignatedagencyethics officials.Withdiminishingresources,thisrequirementwillundoubtedlylackthecapacityforfull oreffectivecompliance. Intermsofthe30dayreportingrequirementforfinancialtransactions,wealsoquestionthe necessityandrationaleforexpandingcoveragetocareerfederalemployees.Aswiththe financialdisclosures,itdoesnotappearthatalackofreportingoneachfinancialtransaction hasledtodocumentedinsidertradingproblemswithinthecareerSES.Furthermore,such reportingrequirementsareburdensomeandcomplex.SeniorExecutivescouldeasilyfallafoul oftherequirementswithoutrealizingtheyhavedoneso.IfaSeniorExecutiveusesafinancial advisororportfoliomanager,heorshemightnotgetwordofindividualfinancialtransactions withinthe30daywindow,orhavetheabilitytoreceivethenecessaryinformationtomake reportsonindividualtransactions. Overall,SEAbelievesthatsuchextensive,burdensomeandpublicreportingrequirementswill haveachillingeffectonthoseemployeesconsideringenteringtheSES.Wequestionwhy anyonewouldwanttosubjectthemselvestosuchbroad,unnecessaryscrutiny.Iftheintentof

    thislegislationistoincreasepublicconfidenceingovernment,webelievethatincludingcareer SeniorExecutiveswithinthescopeofS.2086srequirementsdoesnothelpachievethatgoal. WeencourageyoutoreconsidertheHouseamendmentsandnarrowlytailorthislegislationto onlyapplytoMembersofCongress,theirstaff,andpoliticalappointeesandaskyoutoremove theprovisionsinSection6andSection11thatwouldcovercareerfederalemployees. Sincerely, CAROLA.BONOSARO President WILLIAML.BRANSFORD GeneralCounsel

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