Bill: Draft Conflict of Interest Reform Act

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CONGRESS OF THE
COMMONWEALTH OF REDMONT
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A BILL TO

Reform Conflict of Interest Standards to Permit Ownership Subject to Recusal




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The people of the Commonwealth of Redmont, through their elected Representatives in the Congress and the force of law ordained to that Congress by the people through the constitution, do hereby enact the following provisions into law:


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PART I — PRELIMINARIES

1. Short Title and Enactment

(1) This Act may be cited as the ‘Conflict of Interest Reform Act’

(2) This Act shall be enacted immediately upon its signage.

(3) This Act has been authored by President Theory Fontaine.

(4) This Act has been co-sponsored by Representative lovepurplepoodle, Deputy president of the senate ElegantAlly.

(5) This Act amends the following acts:

(a) Conflict of Interest Standards Act

(b) Criminal Code Act

2. Reasons and Intent

(1) The Conflict of Interest Standards Act treats ownership itself as the harm. The harm is not ownership, it is an officeholder exercising public power over their own interest.

(2) Forced divestiture is a disproportionate remedy in a Commonwealth of this size. It punishes the most experienced citizens for the very experience that makes them suitable, and it drives capable people out of public service rather than into it.

(3) Recusal is the ordinary remedy for conflicts in every mature jurisdiction. It is targeted, verifiable, and does not require a citizen to liquidate their life's work as the price of a nomination.

(4) The intent of this Act is that a Secretary may found, own, and hold a controlling stake in a bank, but may never audit, charter, licence, penalise, or contract with that bank. The conflict is managed at the point of decision rather than at the point of ownership.

(5) The power to compel divestiture is retained by the President for the narrow cases where recusal cannot protect the public interest, subject to public justification and Congressional oversight.

3. Definitions

(1) For the purposes of this Act, the following definitions shall apply:

(a) Declarable Interest. Any ownership, executive, directorship, partnership, or significant financial interest described in §4 of the Conflict of Interest Standards Act.

(b) Official Act. Any exercise of public authority by an officeholder, including any decision, vote, approval, audit, investigation, award, order, or determination made in their official capacity.

(c) Recusal. The complete withdrawal of an officeholder from a matter, including abstaining from any decision, vote, direction, or deliberation on it, and refraining from accessing confidential information concerning it.

(d) Alternate Officer. A person who discharges a duty from which the officeholder has recused, in accordance with §6 of the Conflict of Interest Standards Act.

PART II — AMENDMENTS TO THE CONFLICT OF INTEREST STANDARDS ACT

4. Amendment of §4

(1) §4 of the Conflict of Interest Standards Act is amended as follows:

4 - Prohibited Conflicts of Interest Declarable Conflicts of Interest

(1) No person may be nominated, appointed, or continue to serve in any position covered by §3 if they have any of the following conflicts: A person covered by §3 holds a declarable interest, and must comply with §5 and §6, where any of the following apply:

(2) Business Ownership Conflicts:

(a) Owns, wholly or in part, any business entity that regularly contracts with or is regulated by the government department they would serve in. They own, wholly or in part, any business entity that contracts with or is regulated by the government department or body they serve in.

(b) Holds a controlling interest in any business entity operating within the same sector or field as the government department they would serve in. They hold an interest, including a controlling interest, in any business entity operating within the same sector or field as the government department or body they serve in.

(3) Corporate Executive Conflicts:

(a) Sits on They sit on the board of directors of any business entity that operates within the same sector or field as the government department they would serve serve in.

(b) Holds They hold an executive officer position in any business entity that operates within the same sector or field as the government department they would serve serve in.

(4) Legal Practice Conflicts:

(a) Owns, operates, or holds a partnership in any active legal firm while serving in the Judicial Branch. They own, operate, or hold a partnership in any active legal firm while serving in the Judicial Branch.

(b) A judicial officer holding an interest under (a) must recuse themselves from any matter in which that firm, or any partner or employee of it, appears or has appeared, and must not personally appear as counsel before any court of the Commonwealth while holding judicial office.

(5) Financial Conflicts:

(a) Holds They hold significant financial investments in any single company that operates within the same sector or field as the government department they would serve serve in.

(6) For the avoidance of doubt, a declarable interest is not a bar to nomination, appointment, or continued service. No person may be denied office, removed from office, or compelled to divest by reason only of holding a declarable interest, including a controlling interest.

5. Amendment of §5

(1) §5 of the Conflict of Interest Standards Act is amended as follows:

5 - Disclosure Requirements

(1) All nominees for positions covered by this Act must provide a detailed financial disclosure statement, including:

(a) All business ownership interests

(b) All executive officer positions held in the past 3 months

(c) All significant financial investments and assets

(d) All directorships held and all interests in active legal firms

(2) These disclosures must be made available to the confirming body in the nominee’s opening statement.

(3) Failure to provide complete and accurate disclosure shall disqualify the nominee from consideration.

(4) A person covered by §3 must update their disclosure within 7 days of acquiring, materially increasing, or disposing of a declarable interest.

6. Substitution of §6

(1) §6 of the Conflict of Interest Standards Act is repealed and substituted as follows:

6 - Divestiture Requirements Recusal and Management of Conflicts

(1) Nominees who have conflicts as defined in §4 must completely divest themselves of such conflicts before assuming office. A person covered by §3 who holds a declarable interest must recuse themselves from any official act that specifically affects the business entity in which that interest is held.

(2) Divestiture must be completed within 14 days of nomination, or the nomination shall be considered withdrawn. Official acts requiring recusal include, but are not limited to:

(a) audits, examinations, inspections, and investigations;

(b) the granting, refusal, suspension, or revocation of charters, licences, permits, or registrations;

(c) enforcement action, fines, or penalties;

(d) the award or administration of any government contract, grant, or subsidy;

(e) any rule, order, or determination applying only or primarily to that entity.

(3) Proof of divestiture must be provided before the nominee may assume their duties. A recused duty shall pass to the most senior officer of the same department or body who does not hold a conflict in the matter. Where no such officer exists, the President shall appoint an impartial alternate officer to discharge that duty for that matter alone.

(4) Where the FRB Governor or Lieutenant Governor holds a declarable interest in a financial institution, no audit, examination, or enforcement action concerning that institution may be conducted, approved, or signed off by them. Such action shall instead be carried out by the other officer, or by an independent auditor appointed by the President.

(5) Each recusal shall be recorded in writing, stating the matter and the interest concerned, and published within 7 days.

(6) Nothing in this Act prevents a person covered by §3 from founding, owning, acquiring, retaining, or increasing an interest in any business entity, including a controlling interest, provided they comply with §5 and this section.

(7) The President may, by written order stating reasons, require a specific interest to be divested where recusal alone cannot protect the public interest, including where recusal would prevent the officeholder from discharging the substantial majority of their duties. Such an order must be publicly announced, is subject to Congressional oversight, and must be complied with within 14 days of service.

7. Amendment of §7

(1) §7 of the Conflict of Interest Standards Act is amended as follows:

7 - Ongoing Compliance

(1) Any individual who acquires a conflict of interest as defined in §4 while serving must immediately disclose such conflict and divest within 14 days or resign their position. Any individual who acquires a declarable interest while serving must disclose it within 7 days and recuse in accordance with §6.

(2) The President shall monitor compliance and report violations as appropriate.

8. Repeal of §9

(1) §9 of the Conflict of Interest Standards Act is repealed in its entirety, the prohibitions to which it applied having been replaced by the recusal framework in §6.

9 - Exemptions and Waivers Repealed

(1) The President may grant a limited waiver for conflicts, only if any of the following conditions are met:

(a) The conflict is minor and unlikely to affect the individual's judgment;

(b) The individual's expertise is essential, and no suitable alternative candidate exists;

(c) Appropriate safeguards are established to prevent improper influence.

(2) All waivers must be publicly announced with written justification and are subject to Congressional oversight.

9. Amendment of §10

(1) §10 of the Conflict of Interest Standards Act is amended as follows:

10 - Transition Period

(1) Current office holders have 14 days from the enactment of this Act to come into compliance with its requirements. the Conflict of Interest Reform Act to file a disclosure under §5.

(2) Those who cannot or will not comply must resign their positions within this period. No office holder shall be required to resign or divest by reason only of an interest disclosed under this section.

10. Amendment of §11

(1) §11 of the Conflict of Interest Standards Act is amended by inserting the following subsection:

(6) "Declarable Interest", "Official Act", "Recusal", and "Alternate Officer" bear the meanings given to them in §3 of the Conflict of Interest Reform Act.

PART III — AMENDMENTS TO THE CRIMINAL CODE ACT

11. Amendment of PART II: PROPER ADMINISTRATION OF GOVERNMENT

(1) Offence 6 of PART II of the Criminal Code Act is amended as follows:

6 - Conflict Violation Failure to Recuse

Offence Type: Indictable
Penalty: Up to 350 Penalty Units; Up to 60 minutes imprisonment; immediate removal from the office they hold a conflict of interest. the office in which the offence was committed.

A person commits an offence if the person:

(a) serves in a position covered by the Conflict of Interest Standards Act while knowingly maintaining a prohibited conflict of interest; or knowingly takes, participates in, or directs an official act from which they were required to recuse under §6 of the Conflict of Interest Standards Act; or

(b) fails to divest themselves of a prohibited conflict of interest within the required timeframe; or fails to disclose a declarable interest within the timeframe required by §5 or §7 of that Act; or

(c) acquires a prohibited conflict of interest while serving and fails to disclose and divest within 14 days. fails to comply with a divestiture order made under §6(7) of that Act within 14 days of service.

Relevant Law: Act of Congress - Conflict of Interest Standards Act

(2) Offence 7 of PART II, False Financial Disclosure, is unamended and remains in full force.

PART IV — FINAL PROVISIONS

12. Severability

(1) If any provision of this Act is found to be unconstitutional or invalid, the remaining provisions shall continue in full force and effect.