Disclosing Conflicts of Interest: Avoiding Corruption in Federal Government

Elected and appointed officials and government employees alike must eschew conflicts of interest and avoid the appearance of a conflict of interest in fidelity to the public trust. Appointees to specialized government roles should be well-qualified to serve in those roles.

— MWEG's Principle of Ethical Government 1(c)

Defining “conflict of interest” — and why it matters

On its own, a potential conflict of interest is innocuous. Coaching your daughter’s soccer team poses a potential conflict of interest with your employer. Yet, if you take leave for it or coach only during off hours, and if you complete your work and remain honest about your time, the potential for conflict with your job is reconciled. 

Corruption feeds on conflicts of interest, however, and defining the term depends on context. In constitutional law and for the purposes of this article, the most relevant conflict of interest is “the conflict created when public officials consider their own institutional or personal interests.” Two potential conflicts of interest in the federal government are: 1. When an official makes a decision based on their own interests as opposed to the interests of the people, and 2. When an official appears to hold bias or act corrupt.

When a person holds a government office, they are required to formally acknowledge potential conflicts of interest. A newly elected city council member must disclose ownership of her car dealership and would be ineligible to bid for the contract to supply the city with vehicles. A presidential Cabinet appointee who works in the business sector is required to disclose his companies and either recuse himself (e.g., withdraw from participating on a company’s board of directors) and/or divest his assets (e.g., transfer his stocks to an extended family member) while serving on the Cabinet.

If, in either of these examples, the government official profits from their interests while in office, they become subject to the consequences of breaking those regulations or laws. Even further, they lose the trust of their constituents and damage by association the reputations of their colleagues, party members, and government in general. The more prominent or higher the office, the more potential for breaches of trust with allies and other countries. A conflict of interest at high levels can jeopardize treaties, weaken national security, devalue the U.S. dollar, negatively impact global markets, and invite additional bad actors to approach the U.S. with unscrupulous deals.

The Constitution and conflicts of interest

The Constitution’s overarching doctrine of separation of powers deals directly with the potential for corruption in a government, creating a system of checks and balances intended to prevent any one person or entity from overreach. Conflicts of interest present a common form of overreach.

Three “emolument” clauses and a “disqualification” clause are found in the Constitution. An emolument means “any profit, gain, or advantage,” by federal government officials.

Foreign emolument clause: No office holder may accept emoluments or titles from foreign states or rulers unless approved by Congress.

Example: The founders discussed how to manage the customary gift giving of foreign leaders without offending them and without any appearance of impropriety at home. During the Constitutional Convention, founders likely recalled how Benjamin Franklin had recently received an “opulent snuff box” from the King of France.

Domestic or presidential emolument clause: The president may not accept an increase in salary or gifts from other state or federal officials while serving as president.

Example: An October 2024 report from the House Committee on Oversight and Accountability found evidence that President Trump took payments from the U.S. Secret Service as well as other government officials for stays in his Washington, D.C., International Trump Hotel.

Ineligibility emolument clause: No senator or representative of Congress may be appointed to another government position that was created or for which compensation was increased during their term in Congress.

Example: Former President Nixon nominated U.S. Senator William Saxbe to serve as his attorney general during the same session where Congress had voted to increase the attorney general salary from $35K to $60K. Approving Saxbe would be in violation of the ineligibility clause. In what is now a common practice and called the “Saxbe fix,” Congress instead rolled back the attorney general salary to $35K and approved Saxbe to the position.

14th Amendment insurrection or disqualification clause: No person may hold office after attempting an insurrection of rebellion against the government. Their rebellion serves as a conflict of interest.

Example: In 2021, The House of Representatives voted for the impeachment of President Trump for inciting an insurrection on Jan. 6. When Congress resumed session thereafter, the Senate agreed Trump was “guilty.” However, since he was no longer president, impeachment no longer applied. 

Regulating conflicts of interest

The need to monitor, regulate, and execute judgements and consequences of conflicts of interest exists within government. Holding officials to ethical standards requires applying separation of powers along with adhering to a set of regulations and laws. 

Executive branch

Since 1978, the U.S. Office of Government Ethics (OGE) has managed the executive branch ethics program in part by making and interpreting laws, administering the executive branch financial disclosure system, and monitoring senior leader and agency compliance. The office operates under a series of laws and regulations, which continue to develop. 

Legislative branch

Ethical issues within the House of Representatives fall under the Office of Congressional Conduct and the House Ethics Committee; the Senate Select Committee on Ethics handles matters within the Senate, including conflicts of interest. Both legislative bodies launch investigations and move through set procedures to determine breaches of ethics and next steps.

Judicial branch

The Judicial Conference's code of conduct and its Committee on Codes of Conduct oversee federal jurists except those on the Supreme Court of the United States (SCOTUS). In 2023, and to clear up “misunderstandings,” SCOTUS formalized its own code of conduct, codifying principles they believed they were already following.

Additional legislation

In addition to the laws passed by OGE and the codes of conduct and procedures for the House and the Senate, Congress has enacted legislation and affixed consequences for violating conflicts of interest standards. These laws are designed to prohibit a person who holds a government office from taking official action when they, designated family members, business partners, or companies of personal interest to the officeholder stand to benefit financially. Three sets of laws address potential conflicts of interest between the U.S. government and private citizens and companies.

The Lobbying Disclosure Act of 1995 included previous lobbying regulations and added restrictions on a person receiving payment for lobbying government employees and elected officials, including disclosing their position/role to the clerk of the House of Representatives and senate secretary.

Executive orders outlined standards of ethics for government employees and officers until the OGE was in place and established further legislation and oversight. Presidents Biden, Trump (first term), Obama, and Clinton all signed similar executive orders with additional details concerning ethics expectations for their administrations.

Revolving door policies deal with limitations, including time, on government employees revolving in and out of government and private positions. These are in place to prevent conflicts of interest regarding preferencing future employers or divulging information to influence other administrations.

A call for ethics reform

With an abundance of codes, laws, and systems of accountability in place, some may wonder how politicians are somehow not held accountable for conflict of interest violations they appear to commit. And yet, the perception of corruption in the government exists, at the very least skirting the “appearance” of conflicts of interest as written in the Constitution. According to the 2024 results of Transparency International’s Corruption Perception Index, the U.S. has experienced a significant decline of 10 points from 2017-2024, meaning the perception of corruption has increased substantially.

Despite codes and laws in place, not all government officials are held accountable for breaching conflicts of interest and other corrupt actions. Legal scholars, lawmakers, and citizens alike continue to call for ethics reform in the government. Two proposed reforms include tightening the language within laws, as well as clarifying or adopting the same standards for officials across all branches of government.

This article was written by Sherilyn Stevenson, lead researcher and writer for Mormon Women for Ethical Government.