The government's system for preventing and detecting conflicts of interest among federal employess is so inadequate that many conflicts are never discovered or never corrected, a General Accounting Office study has concluded.
Many employees who should file financial disclosure reports aren't required to, many who are required to don't, and enforcement is lax overall, the study found.
The GAO, Congress' investigative agency, urged President carter to create an office of ethics to establish and enforce an effective conflict-of-interest program.
Such a program woul replace the current 12-year-old inn which problems abound "because of the low priotiry assigned in terms of staffing, funding, and agency and executive branch support," the GAO said.
Citing the executive system's "inability to avoid real or apparent conflict-of-interest problems ," it said:
"THe avoidance of conflict of interst is essential. . . if Americans are to regain their confidence in the integrity of the federal government."
The GAo report, released yesterday, followed earlier GAO examination s of three departments and 13 agencise that found widespread deficiencies in curbs on conflict of interest.
GAO conducted the studies at the request of Reps. John E. Moss (D-Calif.) and Benjamin S. Rosenthal (D-N.Y.). A GAO sampling found that 10 per cent of required financial disclosure statements had not been filed, 12 per cent disclosed questionable interest, and more than 2,500 employees ahould have been filing disclosure statements but were not required to.
Among other findings, GAO discovered 100 Federal Aviaiton Administration emplyers holding airline or airport Bank employess not disqualifying themselves when they had interest in companies with business before the bank, and few or no disclosure statements being filed by Civil Aeronautics Board and Federal Maritima Commission employess. At the Agriculture Department, the GAO said, it reviews 429 disclosure statements and found 488 reported financial interets "questionable." At the Tennessee Valley Authority, the GAO found situations which, it said, "could create the appearamce of a conflict" - 21 employees owning stock in interest in TVA suppliers, and three employees with real estate holdinga on TVA lakes.
In response to GAO recommendations, the Interior Department found some employes in on bureau owing more than 500 financial interests prohibited by agency regulations. Interior then ordered divestiture, the GAO report said.
As an example of the erratic way that financial disclosure has been handled, the GAO said if found that the Civil Aeronautics Board for many years required few employees below the GS-16 level to file disclosure statements while the Food and Drug Administration required certain jobholders from GS-5 up to file.
THe current system was set up under a 1965 order by President Johnson, in addition to some criminal and civil laws. The Civil Service Commission was given responsibility for approving and reviewing the disclosure programs of each agency. The commission was not, however, given authority to audit or enforce.
The GAO found that ethical stand ards are undefined, inconsistenr decisions have been made, and the review of employee's interest has been inadequate. IN addition, some agency employees technically complied with federal laws barring conflicts of interest but financial intersts were held by immediate family members. GAO said it found 34 employers at the Federal Communications Commission in this group.
THe curret disclosure system affects employees paid at the executives level, at GS-13 and up who are in decision-making jobs or who can have an economic impact on non-federal ventures, and those below GS-13 whose jobs give them similar authority.