At least once, a contractor self-reported a personal conflict of interest. From the GAO’s report, “In 2006, a conflict of interest for one of this companyâs employees was disclosed on the annual certification. According to the companyâs senior vice president, after the employee disclosed that his wife had taken a job with one of the centerâs prime contractors, the company removed him from performing service under the subcontract. That was because the companyâs annual review revealed not only that the employee might have a financial conflict of interest that could not reasonably be mitigated with the subcontracted work he was performing at the Electronic Systems Center,10 but he had not complied with the companyâs ongoing requirement for employees to avoid prohibited financial interests and to immediately notify the company when financial interests change from what was certified in an employeeâs last disclosure.”
Also, conflict of interest policies at corporations are often broader than those at government agencies, often “requir[ing] their employees to avoid a range of interestsâsuch as owning substantial stock in competitors or suppliersâthat conflict with the firmsâ interests.” And, while not every firm has a written policy, as we told you last week, just about every program manager at DoD has a written conflict-of-interest policy in place for their contractor employees.
According to GAO, a prevailing argument against new PCI regulations for contractors is “that the risk of conflicts of interest for contractor employees was low because it would be obvious if these employees tried to steer decision making to favor a personal interest or bias.” Also, the report says that “most support contractor employees are retired military and have been accustomed to abiding by government rules for 30 years.”
There is no push for new PCI regulations from inside the acquisition community. It seems that there’s a consensus, at least between contractors and their DoD program managers, that current conflict of interest safeguards adequately protect the government’s interests, and that new PCI regulations would only bring new costs and further delay projects.