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Friday, August 31, 2018
Ethics: Lawyer Pays Off State Employees to Testify Against Their Own Investigation
By News Release @ 7:50 PM :: 4684 Views :: Ethics, Hawaii State Government

Conflicts of Interests and Misuse of State Resources for Outside Employment Activities

Hawaii State Ethics Commission, Resolution of Investigation 2018-3, August 22, 2018 (excerpts)

The Hawaii State Ethics Commission (“Commission”) has resolved its investigation against two state employees (“State Employees”) for alleged ethics violations stemming from certain outside employment activities.1

I. Admitted Facts

State Employees admitted to the following facts: In January 2017, State Employees were hired as consultants by a defendant in a private legal dispute. At the time, the defendant was being investigated by the State Employees’ state agency based on allegations raised by the plaintiff in the underlying case. Because the investigation was assigned to another state employee, the State Employees were initially unaware of the pending investigation affecting their client.

After the initial contact, Employees were informed by their client about the pending investigation. To avoid a direct conflict with the pending agency matter, the State Employees postponed their outside employment until the state agency had closed its investigation.2

Between January and March 2017, Employee A participated in several client meetings during non-state hours, and later testified on behalf of the client at a court hearing, which included certain recommendations. Employee A’s recommendations were directly contrary to those given by Employee A’s state agency.

Employee B assisted Employee A by attending several client meetings in February and March 2017. Three of these meetings occurred while Employee B was on-call for the state agency and involved use of a state vehicle.

B. Conflict of Interests, HRS § 84-14(b)

HRS § 84-14(b) prohibits a state employee from accepting outside employment if the employee has reason to believe that he or she may be called upon to take official action affecting their prospective employer. This provision of the conflicts of interests law essentially prohibits state employees from acquiring or accepting new outside employment that would “create” a conflict of interest with their state duties.

In this case, Employee A’s actions likely violated HRS § 84-14(b). Employee A was informed about the pending investigation being conducted by the state agency and was alerted about the conflict issue. Even though the investigation was subsequently resolved, there was still a potential conflict based on the nature of Employee A’s state duties and the fact that the underlying legal dispute was still on-going.

Because there was the risk of additional complaints being reported to the state agency, there was a reasonable likelihood that Employee A would be directly involved in taking official action affecting Employee A’s own client.5 As such, Employee A should not have accepted the outside consulting work.

C. Misuse of State Position to Benefit Others, HRS § 84-13

HRS § 84-13, the general fair treatment law, prohibits state employees from using their official position to grant unwarranted treatment for themselves or others. Employee A likely violated the fair treatment law by submitting a written report and testifying as a witness on behalf of the client in the underlying court proceeding.

Employee A’s testimony was based on Employee A’s years of experience with the state agency. Employee A also admitted that the testimony given was not based on a fair and thorough examination of the facts. Employee A’s testimony was offered to counter the recommendations given by Employee A’s own agency and bolster the client’s arguments in the underlying court proceeding. As such, Employee A’s actions did not appear to comport with the requirements of the general fair treatment law.

D. Misuse of State Resources for Private Business Purposes, HRS § 84-13(3)

HRS § 84-13(3) specifically prohibits state employees from using state time and resources for private business purposes. Employee B appears to have violated HRS § 84-13(3) by engaging in outside employment activities while Employee B was on-call for the state, and by using a state vehicle to attend client meetings.

II. Resolution of Investigation

The Commission believes that further administrative action and penalties are not warranted based on the following: State Employees fully cooperated with the Commission in its investigation, and accepted responsibility for their actions. State Employees did not actively solicit the outside work and are no longer providing such consulting services to private individuals. The Commission also recognizes that the current shortage of third-party providers and professionals who are qualified to assist members of the public, along with the lack of clear agency guidelines governing outside employment activities for agency employees, were mitigating factors….

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