[Code of Federal Regulations] [Title 5, Volume 3] [Revised as of January 1, 2008] From the U.S. Government Printing Office via GPO Access [CITE: 5CFR3101.108] [Page 681-684] TITLE 5--ADMINISTRATIVE PERSONNEL CHAPTER XXI--DEPARTMENT OF THE TREASURY PART 3101_SUPPLEMENTAL STANDARDS OF ETHICAL CONDUCT FOR EMPLOYEES OF THE Sec. 3101.108 Additional rules for Office of the Comptroller of the Currency employees. The following rules apply to the employees of the Office of the Comptroller of the Currency and are in addition to Sec. Sec. 3101.101- 3101.104: (a) Prohibited financial interests--(1) Prohibition. Except as provided in paragraphs (a)(3) and (g) of this section, no OCC employee, or spouse or minor child of an OCC employee, shall own, [[Page 682]] directly or indirectly, securities of any commercial bank (including both national and State-chartered banks) or commercial bank affiliate, including a bank holding company. (2) Definition of ``securities''. For purposes of paragraphs (a)(1) and (a)(3) of this section, the term ``securities'' includes all interests in debt or equity instruments. The term includes, without limitation, secured and unsecured bonds, debentures, notes, securitized assets and commercial paper, as well as all types of preferred and common stock. The term encompasses both current and contingent ownership interests, including any beneficial or legal interest derived from a trust. It extends to any right to acquire or dispose of any long or short position in such securities and includes, without limitation, interests convertible into such securities, as well as options, rights, warrants, puts, calls, and straddles with respect thereto. (3) Exceptions. Nothing in this section prohibits an OCC employee, or spouse or minor child of an OCC employee, from: (i) Investing in a publicly traded or publicly available mutual fund or other collective investment fund or in a widely held pension or similar fund provided that the fund does not invest more than 25 percent of its assets in securities of one or more commercial banks (including both national and State-chartered banks) and commercial bank affiliates (including bank holding companies) and the employee neither exercises control over nor has the ability to exercise control over the financial interests held in the fund; (ii) Investing in the publicly traded securities of a holding company of a nonbank bank or of a retailing firm that owns or sponsors a credit card bank as defined by the Competitive Equality Banking Act of 1987, except that an employee who owns such an interest must be disqualified from participating in the regulation or supervision of the nonbank bank or the credit card bank; (iii) Using a commercial bank or commercial bank affiliate as custodian or trustee of accounts containing tax-deferred retirement funds; or (iv) Owning any security pursuant to a waiver granted under paragraph (g) of this section. (b) Prohibited borrowing--(1) Prohibition on employee borrowing. Except as provided in this section, no covered OCC employee shall seek or obtain credit from any national bank or from an officer, director, employee, or subsidiary of any national bank. (2) Prohibition on borrowing by a spouse or minor child. The prohibition in paragraph (b)(1) of this section shall apply to the spouse or minor child of a covered OCC employee unless the loan or extension of credit: (i) Is supported only by the income or independent means of the spouse or minor child; (ii) Is obtained on terms and conditions no more favorable than those offered to the general public; and (iii) The covered OCC employee does not participate in the negotiation for the loan or serve as co-maker, endorser, or guarantor of the loan. (3) Covered OCC employee. For purposes of the prohibitions on borrowing contained in paragraphs (b)(1) and (b)(2) of this section, ``covered OCC employee'' means: (i) An OCC bank examiner; and (ii) Any other OCC employee specified in an OCC instruction or manual issuance whose duties and responsibilities, as determined by the Comptroller of the Currency or his or her designee, require application of the prohibition on borrowing contained in this section to ensure public confidence that the OCC's programs are conducted impartially and objectively. (4) Exceptions--(i) Non-examiners. A covered OCC employee, other than an examiner, or the spouse or minor child of such a covered OCC employee, may seek or obtain a credit card from a national bank if the credit card is sought or obtained on terms and conditions no more favorable than those offered to the general public. (ii) Examiners. (A) An examiner, or the spouse or minor child of an examiner to whom the prohibition in paragraph (b)(1) of this section applies, may seek or obtain a credit card from a national bank the examiner is not assigned to examine so long as the credit [[Page 683]] card is obtained on terms and conditions no more favorable than those offered to the general public and the examiner submits to the Chief Counsel or designee a written disqualification from the examination of that bank. Such a recusal would not prevent an examiner from participating in other bank supervision matters outside the scope of an examination, such as licensing or supervisory policy decisions. (B) For purposes of this section, examiners are assigned to examine a bank if they work: (1) In a district, and the bank is one they examine or that is assigned to their Assistant Deputy Comptroller or rating official; or (2) In Large Bank Supervision or Washington, D.C. Headquarters, and the bank is one to which they are regularly or otherwise assigned. (5) Pre-existing credit. This section does not prohibit a covered OCC employee, or spouse or minor child of a covered OCC employee, from retaining a loan from a national bank on its original terms if the loan was incurred prior to employment by the OCC or as a result of the sale or transfer of a loan to a national bank or the conversion or merger of the lender into a national bank. Any renewal or renegotiation of a pre- existing loan or extension of credit will be treated as a new loan subject to the prohibitions in paragraphs (b)(1) and (b)(2) of this section. (c) Restrictions arising from third party relationships. If any of the entities listed in paragraphs (c)(1) through (c)(7) of this section have securities that an OCC employee would be prohibited from having by paragraph (a) of this section, or loans or extensions of credit that a covered OCC employee would be prohibited from obtaining under paragraph (b) of this section, the employee shall promptly report such interests to the Chief Counsel or designee. The Chief Counsel or designee may require the employee to terminate the third party relationship, undertake an appropriate disqualification, or take other appropriate action necessary, under the particular circumstances, to avoid a statutory violation or a violation of part 2635 of this title, or this part, including an appearance of misuse of position or loss of impartiality. This paragraph applies to any: (1) Partnership in which the employee, or spouse or minor child of the employee, is a general partner; (2) Partnership in which the employee, or spouse or minor child of the employee, individually or jointly holds more than a 10 percent limited partnership interest; (3) Closely held corporation in which the employee, or spouse or minor child of the employee, individually or jointly holds more than a 10 percent equity interest; (4) Trust in which the employee, or spouse or minor child of the employee, has a legal or beneficial interest; (5) Investment club or similar informal investment arrangement between the employee, or spouse or minor child of the employee, and others; (6) Qualified profit sharing, retirement or similar plan in which the employee, or spouse or minor child of the employee, has an interest; or (7) Other entity if the employee, or spouse or minor child of the employee, individually or jointly holds more than a 25 percent equity interest. (d) Prohibited recommendations. Employees of the OCC shall not make recommendations or suggestions, directly or indirectly, concerning the acquisition or sale or other divestiture of securities of any commercial bank or commercial bank affiliate, including a bank holding company. (e) Prohibited purchase of assets. No employee of the OCC, or spouse or minor child of an OCC employee, shall purchase, directly or indirectly, an asset (e.g., real property, automobiles, furniture, or similar items) from a national bank or national bank affiliate, including a bank holding company, unless it is sold at a public auction or by other means which assure that the selling price is the asset's fair market value. (f) Outside employment--(1) Prohibition on outside employment. No covered OCC employee shall perform services for compensation for any bank, banking or loan association, or national bank affiliate, or for any officer, director or employee of, or for any person connected in any capacity with a bank, [[Page 684]] banking or loan association or national bank affiliate. (2) Covered OCC employee. For purposes of the prohibitions on outside employment contained in paragraph (f)(1) of this section, ``covered OCC employee'' means: (i) An OCC bank examiner; and (ii) Any other OCC employee specified in an OCC instruction or manual issuance whose duties and responsibilities, as determined by the Comptroller of the Currency or his or her designee, require application of the prohibition on outside employment contained in this section to ensure public confidence that the OCC's programs are conducted impartially and objectively. (g) Waivers. An agency designee may grant a written waiver from any provision of this section based on a determination made with the advice and legal clearance of the DAEO or Office of the Chief Counsel that the waiver is not inconsistent with part 2635 of this title or otherwise prohibited by law and that, under the particular circumstances, application of the prohibition is not necessary to avoid the appearance of misuse of position or loss of impartiality or otherwise to ensure confidence in the impartiality and objectivity with which agency programs are administered. A waiver under this paragraph may impose appropriate conditions, such as requiring execution of a written disqualification. [60 FR 22251, May 5, 1995, as amended at 67 FR 46841, July 17, 2002]