Chapter 9 Conflicts of Interest

A financial conflict of interest regulatory regime depends upon an adequate financial disclosure system. Without adequate disclosure, enforcement is generally on an honor system, which is unsustainable. Robust financial disclosure permits ethics regulators to determine whether the official duties of the government employee overlap with financial holdings, and thus have the potential to create financial conflicts.

The US system of financial disclosure is the most elaborate in the world. It consists of a number of compromises, built into a statute that was itself a balance between policing financial conflicts and privacy interests. Those compromises are modulated through regulatory interpretation and custom and practice, some of which is not formalized in writing, and therefore depends upon private counsel and nonlitigous interaction between government ethics officials and other advisors for application.