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MERIT SYSTEMS PROTECTION BOARD, OFFICE OF 

GOVERNMENT ETHICS, AND OFFICE OF SPECIAL 

COUNSEL REAUTHORIZATION 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

GOVERNMENT OPERATIONS 

OF THE

COMMITTEE ON OVERSIGHT 

AND GOVERNMENT REFORM 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

December 16, 2015 

Serial No. 114–151 

Printed for the use of the Committee on Oversight and Government Reform 

( 

Available via the World Wide Web: http://www.fdsys.gov 

http://www.house.gov/reform 


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COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM 

JASON CHAFFETZ, Utah, Chairman 

JOHN L. MICA, Florida 

MICHAEL R. TURNER, Ohio 

JOHN J. DUNCAN, JR., Tennessee 

JIM JORDAN, Ohio 

TIM WALBERG, Michigan 

JUSTIN AMASH, Michigan 

PAUL A. GOSAR, Arizona 

SCOTT DESJARLAIS, Tennessee 

TREY GOWDY, South Carolina 

BLAKE FARENTHOLD, Texas 

CYNTHIA M. LUMMIS, Wyoming 

THOMAS MASSIE, Kentucky 

MARK MEADOWS, North Carolina 

RON DESANTIS, Florida 

MICK MULVANEY, South Carolina 

KEN BUCK, Colorado 

MARK WALKER, North Carolina 

ROD BLUM, Iowa 

JODY B. HICE, Georgia 

STEVE RUSSELL, Oklahoma 

EARL L. ‘‘BUDDY’’ CARTER, Georgia 

GLENN GROTHMAN, Wisconsin 

WILL HURD, Texas 

GARY J. PALMER, Alabama 

ELIJAH E. CUMMINGS, Maryland, Ranking 

Minority Member 

CAROLYN B. MALONEY, New York 

ELEANOR HOLMES NORTON, District of 

Columbia 

WM. LACY CLAY, Missouri 

STEPHEN F. LYNCH, Massachusetts 

JIM COOPER, Tennessee 

GERALD E. CONNOLLY, Virginia 

MATT CARTWRIGHT, Pennsylvania 

TAMMY DUCKWORTH, Illinois 

ROBIN L. KELLY, Illinois 

BRENDA L. LAWRENCE, Michigan 

TED LIEU, California 

BONNIE WATSON COLEMAN, New Jersey 

STACEY E. PLASKETT, Virgin Islands 

MARK DESAULNIER, California 

BRENDAN F. BOYLE, Pennsylvania 

PETER WELCH, Vermont 

MICHELLE LUJAN GRISHAM, New Mexico 

SEAN MCLAUGHLIN, Staff Director 

ANDREW DOCKHAM, General Counsel 

JEFF POST, Government Operations Subcommittee Deputy Staff Director 

SHARON CASEY, Deputy Chief Clerk 

DAVID RAPALLO, Minority Staff Director 

SUBCOMMITTEE ON GOVERNMENT OPERATIONS

MARK MEADOWS, North Carolina, Chairman 

JIM JORDAN, Ohio 

TIM WALBERG, Michigan, Vice Chair 

TREY GOWDY, South Carolina 

THOMAS MASSIE, Kentucky 

MICK MULVANEY, South Carolina 

KEN BUCK, Colorado 

EARL L. ‘‘BUDDY’’ CARTER, Georgia 

GLENN GROTHMAN, Wisconsin 

GERALD E. CONNOLLY, Virginia, Ranking 

Minority Member 

CAROLYN B. MALONEY, New York 

ELEANOR HOLMES NORTON, District of 

Columbia 

WM. LACY CLAY, Missouri 

STACEY E. PLASKETT, Virgin Islands 

STEPHEN F. LYNCH, Massachusetts 


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C O N T E N T S 

Page 

Hearing held on December 16, 2015 ...................................................................... 1 

WITNESSES 

The Hon. Susan Tsui Grundmann, Chairman, U.S. Merit Systems Protection 

Board 

Oral Statement ................................................................................................. 4 

Written Statement ............................................................................................ 6 

The Hon. Walter M. Shaub, Jr., Director, U.S. Office of Government Ethics 

Oral Statement ................................................................................................. 15 

Written Statement ............................................................................................ 17 

The Hon. Carolyn N. Lerner, Special Counsel, U.S. Office of Special Counsel 

Oral Statement ................................................................................................. 27 

Written Statement ............................................................................................ 29 

APPENDIX 

Response from the Hon. Susan Tsui Grundman to Questions for the Record ... 58 

Response from the Hon. Walter M. Shaub to Questions for the Record ............. 69 

Response from the Hon. Carolyn N. Lerner to Questions for the Record ........... 112 


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MERIT SYSTEMS PROTECTION BOARD, OFFICE OF GOVERNMENT ETHICS, AND OFFICE OF SPECIAL COUNSEL REAUTHORIZATION 

Wednesday, December 16, 2015 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON GOVERNMENT OPERATIONS, 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM, 

Washington, D.C. 

The subcommittee met, pursuant to call, at 11:10 a.m., in Room 

2154, Rayburn House Office Building, Hon. Mark Meadows [chairman of the subcommittee] presiding. 

Present: Representatives Meadows, Jordan, Walberg, Buck, 

Carter, Grothman, Chaffetz, Connolly, and Norton. 

Mr. MEADOWS. The Subcommittee on Government Operations 

will come to order. Without objection, the chair is authorized to declare a recess at any time. 

Today’s hearing will examine the reauthorization of three important agencies for our Federal workforce, specifically the Merit Systems Protection Board, the Office of Government Ethics, and the 

Office of Special Counsel. The authorizations of the MSPB and the 

OGE and the OSC all expired at the end of fiscal year 2007. However, given the important work that each of these agencies perform, 

their funding has continued. 

Still, in the nearly 10 years since their authorizations have expired, there has been little opportunity for even the most basic and 

needed reforms at these agencies. So, today, we will begin to have 

this conversation about reform and reauthorization for these agencies. 

I’d like to highlight that as we go into a different type of appropriations season next year, this becomes even more critical and 

thus the reason for this hearing today. During this hearing, we’ll 

have the opportunity to learn more about the MSPB and its efforts 

in overseeing the Federal Merit System; obviously, the OGE and its 

oversight role of the executive branch ethics program; and OSC and 

its efforts to protect Federal workers and applicants from prohibited personnel practices, especially the retaliation for whistleblowing. All three organizations have a very important role for the 

executive branch agencies and Federal employees. 

As part of the reauthorization of these agencies, we will also examine and discuss the agencies’ proposals for changes in some of 

their procedures and operations. We will hear testimony from the 

Chair of the MSPB, Susan Tsui Grundmann. Chairman 


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Grundmann can provide information on the current state of the 

MSPB accomplishments made by the agency and the challenges 

ahead. 

And the Director of OGE, Walter Shaub, will update us on the 

OGE’s oversight and leadership role of the executive branch ethics 

program and prevention of the conflict of interest. In addition, Director Shaub, on the outline of OGE’s preparation for the upcoming 

Presidential transition. 

From OSC, Special Counsel Carolyn Lerner joins us today. Special Counsel Lerner can provide us with information on OSC’s role 

in protecting Federal employees from prohibited personnel practices and its efforts at investigating allegations of whistleblower retaliation, evaluating disclosure cases, enforcing and evaluating 

complaints under the Hatch Act, and protecting members of the 

armed services under the Uniformed Service Employment and Reemployment Rights Act. 

We look forward to hearing from all of our witnesses and obtaining a better understanding of the proposed reauthorization language. 

So I now recognize Mr. Connolly, the ranking member of the 

Subcommittee on Government Operations, for his opening statement. 

Mr. CONNOLLY. Thank you, Mr. Chairman. 

And thank you for holding this hearing in the last 2–1/2 days of 

the first session of the 114th Congress. 

I have three hearings today. I belong to two committees that passionately believe no human challenge, no human problem cannot be 

improved with another hearing. So we are glad we are getting 

around to this one. 

These three agencies in front of us, the Merit Systems Protection 

Board, the Office of Government Ethics, and the Office of Special 

Counsel, are among the smallest agencies in the Federal Government, but their work has a tremendous impact on the Federal 

workforce. 

The authorizations for each of these agencies unbelievably expired 8 years ago, in 2007, Mr. Chairman. And they have been sustained by annual appropriations, so congressional action, including 

by this committee, is long overdue. It’s especially important given 

the critical work that these agencies perform. 

I want to thank our witnesses for being here today. Particularly, 

I want to commend them for the vitally important work they do 

and their staffs perform to ensure that the Federal civil service is 

merit-based, not subject to political influence or ethical conflicts of 

interest, and free of prohibited personnel practices, such as retaliation for whistleblowers, as you pointed out, Mr. Chairman. 

MSPB’s 200-person staff is charged with adjudicating appeals relating to adverse employment actions, such as removals and suspensions over 14 days, veterans’ and whistleblowers’ rights, and 

Federal disability and retirement claims. 

MSPB is seeking 5-year reauthorization through fiscal year 2020 

and is proposing that the Office of Personnel Management and 

other agencies assist it in conducting employee surveys. I look forward to a discussion of this as we proceed. 


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I also would like to hear about MSPB’s efforts to address recent 

challenges, including adjudication of 32,000 appeals filed by Federal employees who were furloughed in the shutdown in 2013 due 

to sequestration, budget cuts, and implementation of 2014 Veterans 

Access, Choice and Accountability Act. 

The Office of Government Ethics employs 80 individuals who prepare and issue standards of ethical conduct for the fellow workforce 

and oversee agency ethics programs. OGE seeks its 7-year reauthorization, which follows previous congressional practice to avoid 

the need to seek reauthorization during the first and last year of 

Presidential terms. I’d like to better understand the steps that the 

agency has taken to implement the 2012 Stop Trading on Congressional Knowledge Act, or STOCK Act. I would also like to hear 

about the agency’s preparations for the next Presidential transition. 

The Office of Special Counsel’s primary mission is to protect Federal employees from prohibited practices. It serves as the frontline 

of defense and protection for whistleblowers who disclose government wrongdoing, something particularly important to this committee and our subcommittee. The agency seeks a 5-year reauthorization. It is proposing several legislative changes that would, 

among other things, enhance its access to Federal agency information, increase agency accountability and whistleblower disclosure 

cases, and modify procedural requirements for certain prohibited 

personnel practices. 

I am pleased that OSC has achieved settlements in numerous 

cases on behalf of Veterans Administration employees who were retaliated against because they stepped forward to blow the whistle 

on both the backlog and the lack of quality of care for some of our 

veterans. 

OSC was also instrumental in drawing congressional attention to 

the disclosures by Department of Homeland Security employees regarding the abuse of administratively uncontrollable overtime. 

Those disclosures caused DHS to stop the improper use of these 

payments and resulted in the passage of legislation establishing a 

new pay system for Customs and Border Patrol agencies. 

Mr. Chairman, the fact that these agencies have now gone 8 

years without being reauthorized is a terrible abrogation of our responsibility, congressional responsibility. And I certainly pledge to 

work with you in trying to rectify that situation. 

Thank you for holding this hearing. 

Mr. MEADOWS. I thank the gentleman. 

I’ll hold the record open for 5 legislative days for any member 

who would like to submit a written statement. 

We will now recognize our panel of witnesses. I’m pleased to welcome Honorable Susan Tsui Grundmann, Chair of the U.S. Merit 

Systems Protection Board; the Honorable Walter Shaub, Jr., Director of U.S. Office of Government Ethics; and the Honorable Carolyn 

Lerner, special counsel at the U.S. Office of Special Counsel. 

Welcome to you all. 

And pursuant to committee rules, all witnesses will be sworn in 

before they testify. So if you would please rise and raise your right 

hand. 


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Do you solemnly swear or affirm that the testimony you are 

about to give will be the truth, the whole truth, and nothing but 

the truth? 

Thank you. Please be seated. 

Let the record reflect that all witnesses answered in the affirmative. 

In order to allow time for discussion, please limit your oral testimony to 5 minutes, but your entire written statement will be made 

part of the record. 

And, Ms. Grundmann, you are recognized for 5 minutes. 

WITNESS STATEMENTS 

STATEMENT OF THE HONORABLE SUSAN TSUI GRUNDMANN 

Ms. GRUNDMANN. Thank you. Good morning, Mr. Chairman, 

Ranking Member Connolly, Chairman Chaffetz, and distinguished 

members of this committee. 

On behalf of MSPB and our 220 employees, thank you, Mr. 

Chairman, for bringing us all together. 

It has been both an honor and a privilege to serve as the Chairman of the MSPB and its dedicated workforce for the last 6 years; 

the last 3 of which have been among the most eventful and challenging in our history. These years have also been among the most 

rewarding. 

We are proud of what our agency, through its employees, has accomplished during incredibly trying times and the role that we 

have played in a variety of matters related to the overall operation 

of the Federal civil service. 

During the last 4 fiscal years, our agency has issued over 61,000 

decisions. Over 54,000 of them were issued by our 65 administrative judges, the other over 6,200 were issued by the three, now two, 

board members in headquarters. 

Our numbers are staggering due largely to, as you say, the 

32,000 furlough appeals we received during the summer of 2013 as 

a result of sequestration budget cuts. In a normal fiscal year, our 

agency processes about 6,000 to 7,000 in the regions and about 700 

to 800 in headquarters. 

The last 2 years have been anything but normal with a workload 

five times a regular fiscal year. And while processing times have 

been adversely impacted, I am proud to report two significant accomplishments. We have completed almost 97 percent of our furlough cases. And while we have quantity in abundance, the quality 

of our decisions is ever constant. Our affirmance rate by our reviewing court, the U.S. Court of Appeals for the Federal circuit, is 

at a 4-year high, holding steady for a second year in a row at 96 

percent. 

And with performance at an all-time high, our employee commitment and satisfaction reflected in our employee viewpoint survey 

results have dramatically improved from last year as well. With a 

72-percent response rate, we showed improvement, sometimes dramatic, in the 71 of the 72 core EVS questions, with the greatest 

positive responses in communication from leaders, high rates of 

motivation, commitment to the work, and the agency’s purpose, 


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which is to safeguard, protect, and promote the nine merit principles. 

And while we do not know what the future holds for us in terms 

of factors and resources impacting our workload, this year’s results 

are particularly encouraging as they come at a time when workload 

is at its peak, but employee morale and commitment did not falter. 

This year, we jumped eight slots from last year’s rankings. And it 

is this commitment as recently as last week that the Partnership 

for Public Service recognized by ranking us eighth among small 

agencies in best places to work and the fifth most improved small 

agency in 2015. 

I understand that you, Mr. Chairman, have been paying visits to 

the agencies that have been doing well. I hereby cordially invite 

both you and Ranking Member Connolly to pay us a visit one day 

soon. 

Even though a great deal of our agency time has been dedicated 

to our adjudication function, our statutory studies function continues to produce high-quality, relevant reports that are significant 

to the deliberations of this subcommittee. Unlike our adjudication 

function, which looks backwards in time at events passed, our studies function is forward-looking, garnering a series of best practices 

that can and often become the basis of legislative or regulatory reform. 

Some of our past reports have been uncanny in terms of their 

timing with respect to this committee’s work, such as our barriers 

to whistleblowing, issued in 2011, which we believed helped assist 

in the passage of the Whistleblower Protection Enhancement Act in 

2012; our veterans’ rights report in 2013; our Federal due process 

report, published earlier this year during the dialogue in the VA 

Accountability Act; and our new SES training report, which we will 

release this week, and we hope that will assist in the discussion 

and development of initiatives by OPM following the new executive 

order on SES training and development just issued last night. 

Mr. Chairman, we welcome this occasion for reauthorization. We 

welcome this opportunity to tell our story. But as you note, we 

have only one legislative proposal solely dedicated to our studies 

function, which I will be happy to discuss with you. In the meantime, our work continues, but things are going well. Thank you. 

[Prepared statement of Ms. Grundmann follows:] 


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Mr. MEADOWS. Thank you so much. 

Director Shaub. 

STATEMENT OF THE HONORABLE WALTER M. SHAUB, JR. 

Mr. SHAUB. Chairman Meadows, Ranking Member Connolly, and 

Chairman Chaffetz, and members of the subcommittee, thank you 

for the opportunity to testify on behalf of the reauthorization of the 

Office of Government Ethics. I’m happy to be here with my colleagues from OSC and MSPB. 

OGE was established by the Ethics in Government Act of 1978, 

which came out of the same committee in the same month as the 

Inspector General Act. 

Congress established OGE as part of a broader framework for integrity which is coordinated among a variety of executive branch 

entities. Among others, this includes OSC, MSPB, and the 14,000- 

member inspector general community. The language of the Ethics 

in Government Act makes clear that the primary mission and objective of the ethics program is one of prevention. The program 

works to prevent conflicts of interest so that the American people 

can be confident that public servants make decisions based not on 

their own financial interest but on the interests of the public. Congress designed this program to be decentralized, with OGE setting 

ethics policies and agency ethics offices carrying out day-to-day operations. 

Our strategic goals focus on the three pillars of uniformity, continuity, and transparency. OGE’s work includes a wide range of activities for a small agency of about 70 employees. Much of that 

work can be grouped into the following general areas: Nominations 

and support for Presidential transitions; regulations and guidance; 

oversight of agency ethics programs; development of an electronic 

filing system; assistance to stakeholders; ethics education; and engaging leaders in ethical compliance and ethical culture. 

My written testimony details OGE’s accomplishments in these 

areas. I’ll just highlight a few. Since I became Director in January 

2013, we have leveraged technology to deliver more training, with 

our classes going from 1,400 attendees a year to 7,500 attendees 

in 2015. And 90 percent of customers surveyed said the training 

helped them to do their jobs better. 

Through innovative new approaches, we’ve also cut costs. For example, we hosted our 2014 national ethics summit for less than 1 

percent of the cost of OGE’s traditional conferences. In 2015, we 

showed 59 reports in our oversight reviews of agency ethics programs, and we are on pace to review all agencies before the end 

of my 5-year term. 

We have improved our financial disclosure program by going 

paperless and cutting review times for annual reports from 180 

days to 30 days. As required by the STOCK Act, we developed an 

electronic filing system for financial disclosure. In less than a year, 

we have registered about 10,000 employees and, as of yesterday, 90 

agencies in that system. And 90 percent of agency administrators 

who operate the system for their agencies were surveyed and rated 

the system favorably. 

In 2015, we responded to about 2,000 requests for assistance 

from agencies. And 91 percent of agency ethics officials surveyed 


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said our assistance helped them do their jobs. We received another 

700,000 requests from outside the government. 

Since our last authorization expired, we have issued over 100 

legal advisories. This year, 98 percent of responders to our survey 

said these advisories helped them in their work. We also actively 

support the enforcement community. As Director, I am statutory 

member of CIGIE, the Council of the Inspectors General on Integrity and Efficiency, as well as CIGIE’s Integrity Committee. OGE 

also provides IG staffs and prosecutors with legal advice and training. 

Looking forward, our next big challenge will be the Presidential 

transition. A Presidential transition is a critical time when the Nation is vulnerable with the potential for man-made, natural, and 

economic disasters to strike while the government’s top positions 

are vacant. OGE makes sure that nominees are free of conflicts of 

interest so that top leadership positions can be filled quickly. 

During a transition, our nominee work triples in volume and increases in complexity. The challenge is nothing short of extraordinary, and it requires a full commitment of resources. We’re doing 

everything possible to be ready for the transition because we know 

how important it is. 

Finally, we have submitted a legislative proposal to amend this 

Ethics in Government Act. Because the systems in place are working, the proposal is limited to technical corrections. 

We are also seeking reauthorization through 2022 so that the 

next reauthorization does not coincide with a Presidential transition, when OGE’s resources will be stretched thinnest, but we are 

more than happy to talk to you at any time in between. 

So thank you for the opportunity to testify today. 

[Prepared statement of Mr. Shaub follows:] 


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Mr. MEADOWS. Thank you for your testimony. 

Ms. Lerner, you are recognized for 5 minutes. 

STATEMENT OF THE HONORABLE CAROLYN N. LERNER 

Ms. LERNER. Thank you, Chairman Meadows, Ranking Member 

Connolly, and members of the subcommittee. 

Thank you for the opportunity to testify today about the U.S. Office of Special Counsel. I also want to thank Chairman Chaffetz for 

your being here today and for your ongoing interest in OSC’s work. 

Under your leadership and with Ranking Member Cummings, we 

reformed the Hatch Act in 2012 and, last year, in response to whistleblower disclosures and your oversight, prompted changes to 

overtime at the Department of Homeland Security, saving hundreds of millions of dollars a year. So thank you for being here. 

I am also pleased to be here today with Chairman Grundmann 

and Director Shaub. I appreciate the committee’s interest in reauthorizing OSC. The Office of Special Counsel provides a safe and 

secure channel for government whistleblowers who report waste, 

fraud, and abuse, and threats to public health and safety. 

OSC also protects veterans and servicemembers from discrimination under the Uniformed Services Employment and Reemployment 

Rights Act, or USERRA, and we enforce the Hatch Act, which 

keeps partisan political activity out of the workplace. 

By nearly every statistical measure, OSC is operating more efficiently and effectively than at any time in its history. For example, 

in 2015, OSC received and resolved approximately 6,000 cases, a 

55-percent increase since I took office in 2011. 

We are also getting better results for whistleblowers. For instance, in 2015, OSC secured 268 favorable actions, up from only 

29 favorable actions a few years ago. 

Beyond statistics, our successes in individual, high-impact cases 

show how OSC promotes better and more efficient government. For 

example, our work with whistleblowers has prompted improvements at VA medical centers across the country. It has saved hundreds of millions of dollars every year in overtime payments at the 

Department of Homeland Security. And we helped the Air Force 

fulfill its sacred mission on behalf of fallen servicemembers and 

their families. 

We are promoting integrity through a robust enforcement of the 

Hatch Act, and we are protecting the jobs of returning 

servicemembers and members of the Reserves and Guard. 

Many of our recommendations for OSC reauthorization would 

help to ease the burden resulting from the increased demand for 

our services. In addition to reauthorizing OSD for 5 years, we have 

some recommendations. 

First, we ask Congress to streamline OSC’s access to agency information. This will assist our investigations of retaliation and reviews of whistleblower disclosures. Statutory access to agency 

records would be similar to the authorities provided to the inspectors general and the Government Accountability Office. It will help 

avoid unnecessary and duplicative government investigations and 

lead to quicker and better results. 

Second, we ask that Congress increase agency accountability in 

whistleblower disclosure cases. Over the last 3 years, agencies subVerDate Nov 24 2008 10:26 Jul 31, 2017 Jkt 000000 PO 00000 Frm 00031 Fmt 6633 Sfmt 6633 H:\26027.TXT APRIL

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stantiated 90 percent of the allegations that we referred to them 

for investigation. Typically, the agency will commit to taking corrective actions to remedy the misconduct. But sometimes the corrective plans are insufficient or their actions are incomplete at the 

time that I send my final report to the President and to Congress. 

When there is substantiated misconduct, we recommend that 

Congress require agencies to provide an explanation if they fail to 

take an action, including disciplinary action. And for any agency 

action that is planned but not yet implemented, OSC should have 

statutory authority to request detailed followup information. 

Third, Congress should consider reducing the procedural requirements imposed on OSC in certain prohibited personnel practice 

cases. The current requirements are onerous and unnecessary. In 

every case, regardless of the merits, title V requires OSC to take 

several procedural steps before closing a file. These requirements 

are unique to OSC and use a large amount of our resources. The 

proposed changes would allow us to generate more positive outcomes on behalf of whistleblowers and the American taxpayers. 

Fourth, OSC recommends that Congress eliminate the annual 

survey requirement that was passed as part of a prior OSC reauthorization. In addition to having little statistical or informational 

value, the survey is costly and time-consuming, and it takes away 

from our other duties. We recommend that Congress eliminate this 

requirement so OSC can dedicate our limited resources to actual 

case work. 

Finally, my written testimony includes some additional proposals 

that are of a technical nature. 

I want to thank you for considering these options to improve 

OSC’s authorities. I would be very happy to answer any questions 

that the committee may have. 

[Prepared statement of Ms. Lerner follows:] 


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Mr. MEADOWS. Thank you, Ms. Lerner. 

The chair will recognize himself for 5 minutes for a series of 

questions. 

Thank you for the invitation. I can tell you we’ll take note of 

that. One of the things that the ranking member and I enjoy doing 

is actually reaching out to a number of the Federal agencies. I’ve 

been concerned, I guess, and very surprised to find that many 

times as we have made the visit, it is sometimes the first time a 

Member of Congress has ever shown up at an agency. So shame 

on us. I am committed, along with my ranking member, to make 

sure we change that. So thank you for the invitation. 

Let me focus real quickly on the whistleblower aspect because I 

think we’ve got, Ms. Grundmann and Ms. Lerner, two different 

kinds of areas that address that. But as we look at whistleblowers, 

one of the reoccurring themes that has been very disconcerting to 

me has been the retaliation against whistleblowers and, in even in 

highlighting that, that it continues to go on. And so what happens 

is it has a chilling effect on those who are willing to speak up. We 

did an email address here which was a ‘‘Tell Mark’’ email address, 

and we started getting all kinds of whistleblower information, but 

the overriding concern, in fact, I’ve gotten from the Secret Service, 

a number of agents who have called me from New York to California and in between, is that they want to do it anonymously because there has been retaliation in real terms, whether it be with 

lack of promotion—sometimes it is more subtle. How do we work 

with your two agencies to make sure that we correct that? Anybody 

want to weigh in on that? 

Ms. Lerner? 

Ms. LERNER. Sure, well, they would start with us. And if an employee has a complaint, either a disclosure of waste, fraud, or 

abuse, or a health or safety issue, which we’ve been seeing in 

greater increasing amounts from the VA especially, they can come 

to us and say they want to do it anonymously. 

Mr. MEADOWS. But here is what I’m finding is, is as they do that, 

the minute they raise that profile, what happens is, is somehow the 

information leaks out. I guess my question is, is there any special 

intervention that the special counsel does when we see it trying to 

undermine the very rules that we have in for whistleblower protection? 

Ms. LERNER. Sure. We have a very robust Investigation and 

Prosecution Division that if there is any instance where a whistleblower believes that they are being retaliated against after having 

come to our agency and making disclosure, we can start with the 

agency by requesting an informal stay of any personnel actions. So 

if someone is threatened with their job or even threatened with like 

a demotion or a move, we can go to the agency and say: You need 

to stop; we think there is a basis here. 

If they won’t agree voluntarily to stop the adverse action, we can 

go to the Merit Systems Protection Board and formally ask them 

to do it. 

I should tell you: Whenever we make a disclosure or send a disclosure over to an agency, we include in our referral sort of a warning that says, ‘‘You need to make sure and take active steps to 

make sure there is no retaliation against the whistleblower.’’ 


KING-6430 with DISTILLER
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Mr. MEADOWS. So which agencies would you say have the worst 

track record as it relates to protecting whistleblowers. 

Ms. LERNER. Well, in terms of pure numbers, we get the most 

complaints—in the last 2 years—from the Veterans Administration. 

Mr. MEADOWS. But they feel a protection because it has been 

high profile. So outside of Veterans, who would it be? 

Ms. LERNER. Our second—well, I’m not sure that they do feel 

protection. I mean—I’m sorry, the whistleblowers feel protection, or 

the VA does? 

Mr. MEADOWS. No. Which agencies have the poorest record of 

protecting the whistleblowers? For example, giving retaliation in 

such a way that may not be direct retaliation, but it’s indirect retaliation in that they get transferred or they don’t get to move up 

because the retaliation is a lot more subtle a lot of times than what 

we’re seeing. How do we address that? 

Ms. LERNER. I think the first way is to send a strong message, 

has to start from the top of the agency that says: Retaliation isn’t 

going to be—— 

Mr. MEADOWS. I guess what I am looking for is for this committee, what would be the three agencies we would need to look at 

closest as it relates to whistleblower retaliation? 

Ms. LERNER. In terms of pure numbers, the VA is first. 

Mr. MEADOWS. Okay. Who’s second? 

Ms. LERNER. Second is the Department of Defense. And I should 

note that the Department of Defense has double the number of civilian employees as the VA. 

Mr. MEADOWS. And who would be third? 

Ms. LERNER. Department of Homeland Security is probably—— 

Mr. MEADOWS. So all big, big—— 

Ms. LERNER. The large agencies have the largest numbers. I 

should say that the one agency where we have received a surprisingly small number of complaints is from the Secret Service. 

Mr. MEADOWS. I can tell you that’s very troubling because they 

have found my phone number, and I’m getting—you may get the 

smallest amount, but I can tell you also—and I know that he 

slipped you the note that you have got the smallest amount. I can 

give you a plethora of complaints as it relates to that. 

One of the instances that I’m very concerned about is that once 

a whistleblower had made one particular comment, that there was 

an interview of almost every single employee trying to find out who 

that person was, and that’s the kind of draconian management 

style that this committee is not going to adhere to. I’ll go ahead 

and recognize the ranking member for 5 minutes for his questions, 

a generous 5 minutes. 

Mr. CONNOLLY. Thank you, Mr. Chairman. 

Ms. Grundmann—if we can hold on time. 

Ms. Grundmann? 

Ms. GRUNDMANN. Yes. I just want to chime in very quickly. We 

have essentially two answers for you. The first is we come on the 

back end after OSC has done their work. So we are the adjudicator 

in this process. The front end part is actually in our studies program, and if you look at our report on whistleblowing and barriers 

to whistleblowing, we actually ask people: Are you seeing prohibitive personnel practices? What happens when you see them? And 


KING-6430 with DISTILLER
41 

what happens if you disclose? Is there retaliation? So through the 

studies program, we get a plethora of answers—some of them multiple choice, some of them essay—that will talk about this anonymously and that we can analyze and then we can also publish. 

Thank you. 

Mr. CONNOLLY. Thank you, Mr. Chairman. 

Chairman Grundmann, why has it taken 8 years to get to the 

point where we’re hopefully going to consider reauthorization? 

Ms. GRUNDMANN. There was an attempt previously to do, so it 

just sort of fell off the wagon, I guess, and was forgotten. 

Mr. CONNOLLY. Congress fell off the wagon? 

Ms. GRUNDMANN. Not Congress, but it never came to fruition, if 

you will. 

Mr. CONNOLLY. Director Shaub, same question, from your perspective. 

Mr. SHAUB. I don’t actually have an answer for that. We have 

not had an authorization hearing since 2006. 

Mr. CONNOLLY. 2007. 

Mr. SHAUB. That’s right. It ran out at the end of 2007. We have 

requested that from time to time. So I’m very pleased that you’re 

holding the hearing this year, and we’re thankful for being here. 

Mr. CONNOLLY. Well, we didn’t rush into it. We have 2–1/2 days 

left in this session, but all right. 

Special Counsel Lerner, your perspective. 

Ms. LERNER. When I was nominated in 2011, I was told that the 

agency hadn’t been reauthorized. 

Mr. CONNOLLY. I can’t hear you. I’m sorry. 

Ms. LERNER. Sorry. My mic is on. 

Mr. CONNOLLY. Yeah, but you’ve got to speak into it. 

Ms. LERNER. When I was nominated to be special counsel in 

2011, I was told that the agency hadn’t been reauthorized in a few 

years. And, frankly, it gave me a little bit of a pause to take the 

job because not knowing whether the agency was going to be 

around. But I was assured that it would be; we just needed to have 

a reauthorization process started. And it’s something that we’ve 

been asking for periodically since I became special counsel. I’m 

really pleased that we’re here today. Thank you. 

Mr. CONNOLLY. Well, we’ve got sort of a different spirit on this 

committee, the leadership of Mr. Chaffetz, and hopefully we’ll use 

that spirit on a bipartisan basis to try to rectify that situation. I 

mean, there is just no excuse for going 8 years without a reauthorization. 

Chairman Grundmann, in your testimony, you raised concerns 

about the Veterans Access, Choice, and Accountability Act of 2014 

that allows the VA Secretary, at his or her discretion, to fire a senior executive without prior notice or the opportunity to respond if 

the Secretary determines performance of the individual warrants 

its action. The act provides an expedited appeal process but after 

the determination. 

What’s the nature of your concern about that? 

Ms. GRUNDMANN. On the constitutional side? 

Mr. CONNOLLY. Whatever you want to share with us. 

Ms. GRUNDMANN. In the operations? 


KING-6430 with DISTILLER
42 

Mr. CONNOLLY. Speak as colorfully as you have already; Congress falling off the wagon is a great image. 

Ms. GRUNDMANN. That’s dangerous. 

Mr. CONNOLLY. Cartoonists heed. All right. 

Ms. GRUNDMANN. Twofold. The constitutionality of that particular law is being litigated right now in the Federal circuit. No 

doubt we will have a decision in some course of—— 

Mr. CONNOLLY. And that is about due process. 

Ms. GRUNDMANN. It is about due process. It is also about the appointments clause in the Constitution. The argument is that if you 

eliminate three Presidentially appointed board members from the 

process all together and delegate that authority to a, quote, ‘‘not a 

principal employee’’ and have that decision be final without board 

review, without court review, that is a violation of Article II, Section 2, of the appointments clause. 

There is the constitutional argument on due process as well, and 

due process is prior notice and an opportunity to respond. That is 

also being litigated. 

Mr. CONNOLLY. Well, is that a constitutional issue, or is that just 

a practice? I mean, in the private sector, you’re not entitled to 

those protections. I mean, if the boss decides you’re not performing, 

you’re an at-will employee, and you can be terminated. 

Ms. GRUNDMANN. You’re absolutely right. But according to Supreme Court case law, Loudermill has told us repeatedly that Federal employees have a property interest in continued employment, 

the depravation of which must be accompanied by opportunity—advanced notice and opportunity to respond, nothing more, nothing 

less. 

You raise a really good point, and this gives me an opportunity 

to talk about how that act has impacted our operations. So far, 

we’ve only seen seven cases under the VA Accountability Act. 

Mr. CONNOLLY. So abuse of that new authority is not yet a problem holding in abeyance the merits of those seven. 

Ms. GRUNDMANN. Well, two of them were withdrawn. It’s not the 

abuse of the authority; it is how it impacts our operations. What 

the law says is that once an employee files, he or she is entitled 

to a full hearing. And that hearing for us means discovery, motions, the opportunity to raise affirmative defenses, a full hearing, 

prehearing conferences, along with a written decision. And if you 

look at some of the decisions that we have issued—and we have 

only issued two written decisions—they are about 60 to 70 pages 

long. It is not a summary decision. 

Mr. CONNOLLY. But let’s remember the genesis of the bill: It was 

a growing frustration on the part of veterans, of the public, of this 

Congress. And the inability to assign accountability to Veterans 

Administration officials—everyone was kind of pointing somewhere 

else, and meanwhile, the backlog grows; falsification of medical 

records expanded; treatment was inadequate and, in some cases, 

nonexistent; getting an appointment became, in some places, very 

difficult. And these are our veterans. And there was deep outrage 

up here, and we had to weigh expediting the process determination 

to hold people accountable against process. And while no one wants 

to make light of due process, that was the balancing act we were 

looking at. Your comment on that? 


KING-6430 with DISTILLER
43 

Ms. GRUNDMANN. Yeah, I understand completely the genesis of 

this bill. And let me just share with you a question, a thought. 

When these cases come to us, and this is not just the VA, but any 

case, the employee is off the payroll. They are not being paid during the time they are litigating before us. We wonder—and it’s a 

question—whether or not the bill is actually doing what it’s supposed to do. Agencies may act—the VA, I don’t know this, may actually be taking longer to prepare for these cases because they 

have to finish the case in essentially 18 days. 

Mr. CONNOLLY. Yeah. 

Ms. GRUNDMANN. During the time they are investigating and 

preparing their case on the front end, the employee is still on the 

payroll. So is it having the same effect? Shortening the processing 

period doesn’t get rid of the employee faster; they’ve already been 

removed. It just determines whether or not the removal was proper. 

Mr. CONNOLLY. Well, we look forward to working with you on 

this. I think it is a conundrum. 

Ms. GRUNDMANN. Yes. 

Mr. CONNOLLY. And no one wants to trample overdue process 

and the rights of Federal employees, but we do not want to sacrifice accountability, especially in the case of men and women who 

put on the uniform and serve the country. 

Ms. GRUNDMANN. In order for us to get involved, an agency has 

to act first. 

Mr. CONNOLLY. Yeah. Okay. I wish I had more time because I 

think this is a very important issue. 

Thank you, Mr. Chairman. 

Mr. MEADOWS. I thank you. 

The chair recognizes the chairman of the full committee, Chairman Chaffetz, for a series of questions. 

Mr. CHAFFETZ. Thank you. I thank—to all three of you for your 

good and important work. 

Mr. Shaub, I want to direct my comments to you, if I could. You 

work with some very important issues dealing with ethics. You 

work with some 4,500 ethics officials in more than 130 different 

agencies. I want to focus on honorarium, particularly as it relates 

to public appearances and speaking. Can a government official act 

as an official agent for a charity or a foundation? 

Mr. SHAUB. There’s no specific prohibition on the types of outside 

employment you can have in that regard, but we have to distinguish between the types of government official we’re talking about. 

Mr. CHAFFETZ. If it is a Senate-confirmed position, can you act 

as an agent for a foundation? 

Mr. SHAUB. Certainly not for pay and certainly not as a representative to the government. There’s an outside earned-income 

prohibition in a longstanding executive order so they can’t earn 

honoraria, and they can’t represent anyone back to the government, so it would have to be an outside activity where they would 

speak for free, but they—— 

Mr. CHAFFETZ. But what if there is compensation to a foundation? 


KING-6430 with DISTILLER
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Mr. SHAUB. A government official themselves—I—could not 

speak for any compensation without violating the earned-income 

ban, even if they subsequently donated it to someone else. 

Mr. CHAFFETZ. What if somebody went and spoke and then that 

money was directed or given to a foundation—— 

Mr. SHAUB. Right. 

Mr. CHAFFETZ. Do they have to disclose that? 

Mr. SHAUB. The disclosure depends on whether the money was 

paid to them as an individual speaker and then they chose to donate it to a charity, or whether you’re acting as an agent of some 

sort of charity. A comparable example would be, for instance, if you 

were working for a car dealership and you sold a car, you would 

not report the income from the sale of the car because that’s income of the car dealership. 

Mr. CHAFFETZ. Let’s go back. Can you be an agent, a Senate-confirmed person, can they be an agent of a foundation? 

Mr. SHAUB. Not if they are representing the foundation to the 

Federal Government, but there is no legal prohibition on serving as 

an agent for an outside entity in an outside activity. 

Mr. CHAFFETZ. Do you have to disclose that? 

Mr. SHAUB. Your role as an agent? 

Mr. CHAFFETZ. Yeah. 

Mr. SHAUB. If you have a position with an outside entity, that 

would be disclosable on the form. 

Mr. CHAFFETZ. So you have to disclose that. 

I want to bring up—there have been—there has been a lot of controversy with Secretary Clinton and the lack of candor in her financial disclosures. I will go back to the Wall Street Journal article in 

May of this year. The spokesperson, Mr. Salamone, who works for 

you, commented directly on that case. Did you review that case? 

Mr. SHAUB. I’m hoping I’m remembering the correct one. The one 

I recall was a question not about Secretary Clinton’s speaking activities but about her husband—the former President’s speaking activities. The question Mr. Salamone was asked, if I’m recalling correctly, was, would he be—would she be required to report honoraria paid in compensation for his speaking if he was acting as an 

agent for a foundation as opposed to acting in a personal capacity. 

And Mr. Salamone correctly answered, consistent with our longstanding view of government financial disclosure requirements, 

that that would not be required to be disclosed if he was acting as 

an agent for the foundation, in contrast to a situation where he 

went out on his own, gave a speech, and then donated the funds 

to a charity. 

EDTR ROSEN 

Mr. CHAFFETZ. How could he not be an agent for the Clinton 

Foundation? It is under his own name. 

Mr. SHAUB. I think our understanding was he was an agent, so 

that’s why it was not required to be disclosed. 

Mr. CHAFFETZ. So where is that found in the rules? 

Mr. SHAUB. The statute is a very long, very detailed statute. 

Mr. CHAFFETZ. I have it in front of me, and I went on your Web 

site. He is what your Web site says, ‘‘Do I report payments donated 

or directed to charity?’’ Yes, you must report honoraria as usual. 

Mr. SHAUB. Right. 


KING-6430 with DISTILLER
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Mr. CHAFFETZ. And then if You look at the code, it goes on saying that filers are expected to, and I quote, ‘‘the source, date, 

amount of honoraria from any source received during the preceding 

calendar year aggregating $200 or more in value, effective January 

1st, 1991. The source, date, amount of payments made to charitable 

organizations in lieu of honoraria. And the reporting individual 

shall simultaneously file with the applicants supervising ethics office.’’ 

Mr. SHAUB. Right. So that’s interpreting section 102(a) of the appendix to Title V under the Ethics in Government Act. 

Mr. CHAFFETZ. Correct. 

Mr. SHAUB. That is a provision that applies to your own earnings 

if you go out and speak on behalf as your own individual, on your 

own behalf, earn it and subsequently donate it. And we have been 

very consistent in requiring. But it is not even a close call as to 

whether it would be reportable if you’re acting as an agent of a 

foundation. It is not even a close call. I can tell you unambiguously, 

that’s not reportable. 

Mr. CHAFFETZ. Why isn’t it reportable? I don’t understand. 

Mr. SHAUB. Well, it is for the same reason as the car dealership 

example. Another example is, we’ve had nominees—you know, I’ve 

handled nominee reports personally under both the Bush administration and the Obama administration. I have been doing this for 

a long time. We’ve had a lot of nominees over the years who have 

been attorneys. They have to follow nominee incoming financial 

disclosure reports. So although while they are an appointee, they 

would be covered by outsider and income ban, and there would be 

no income or honoraria to report; nominees are the perfect comparison to a Presidential candidate or the appointee who has a spouse 

doing outside speaking, as in this case, where they do have income 

to report. And, so, they report their earnings from the law firm, but 

they do not report each individual payment from each individual 

client. It is simply not required by the financial disclosure laws. 

Now you have within, you know, within your power to change those 

laws, but it is not—— 

Mr. CHAFFETZ. I’m not understanding where the rule or where 

you can point to in the law, where you have this distinguished— 

Mr. Salamone said, quote, ‘‘Disclosure of speaking fees is not required when the public filer or the filer’s spouse is acting as agent 

of an organization, and payment it made directly to that organization.’’ Where is that found in the rule? 

Mr. SHAUB. 5 U.S.C. appendix section 102(a). 

Mr. CHAFFETZ. Okay. We may be looking at that differently than 

you are, but I would really love to have some details. Why wouldn’t 

we have that disclosed? I just—if you’re trying to maintain the 

maximum amount of transparency which you report to do, it says 

the OGE makes sure that the nominees and Presidential candidates have complied with extensive requirements for financial 

disclosure under the Ethics in Government Act. Have you investigated this situation with Secretary Clinton? 

Mr. SHAUB. The—so that’s a two-part question. I’ll answer the 

first question first, why don’t we pursue maximum disclosure? 

Mr. CHAFFETZ. Yeah. 


KING-6430 with DISTILLER
46 

Mr. SHAUB. Anything that could be potentially relevant or interesting to anyone. And it is simply because we’re a Nation of laws, 

and OGE is specifically regulated by an extremely detailed, highly 

prescriptive statute. Congress left us almost no discretion in terms 

of interpreting this statute. We apply it uniformly to everyone 

across the board, highly detailed. It’s not the statute that I would 

have written, as evidenced by the fact that OGE has a confidential 

financial disclosure system where Congress left us the ability to 

write our own rules. We wrote very different rules for those. 

But we are bound by the laws as they are written, this has been 

OGE’s long-standing interpretation across the board, whether 

you’re a car salesman, an attorney, a Member of Congress. Anybody coming into the executive branch, you disclose income paid to 

you that you earned yourself, act in your own capacity, or you disclose income from an entity, but you don’t disclose every payment 

to that entity. We’ve been absolutely uniform, it is not even a close 

call. 

Mr. CHAFFETZ. So when you show up and give a speech, is that— 

I mean, that seems like a direct payment. There is a reason why 

the University of California, Los Angeles, paid $250,000 to the 

Clinton Foundation it is because Secretary Clinton showed up and 

gave a speech. 

Mr. SHAUB. I have no doubt that they paid that money because 

he gave a speech? 

Mr. CHAFFETZ. She gave that speech, she gave a speech. 

Mr. SHAUB. Sorry, I misunderstand. 

Mr. CHAFFETZ. She did. She was Secretary of State. 

Mr. SHAUB. Okay. 

Mr. CHAFFETZ. And that’s why is I’m curious: Is she an agent for 

the Foundation? Is she the Secretary of State? How do you determine what’s what? 

Mr. SHAUB. Well, I can say for sure she did not have a position, 

but that does not preclude—— 

Mr. CHAFFETZ. She didn’t have a position what? 

Mr. SHAUB. She did not have—she did not hold a formal position 

with the Foundation while she was in the government but—— 

Mr. CHAFFETZ. But—so she wasn’t an agent? 

Mr. SHAUB. No. Those are different questions. The question of 

whether somebody holds a formal position, Vice President, President—— 

Mr. CHAFFETZ. Right. 

Mr. SHAUB. —Secretary, is very different from whether you’re 

acting as an agent. There is an entire—— 

Mr. CHAFFETZ. So was she an agent or not an agent? 

Mr. SHAUB. Well, we don’t investigate their reports so I can tell 

you if—— 

Mr. CHAFFETZ. Wait. Why don’t you investigate their reports? 

Mr. SHAUB. Well, we don’t have the authority. 

Mr. CHAFFETZ. That’s not what you said in your testimony. 

Mr. SHAUB. Well, I believe it was. 

Mr. CHAFFETZ. Your testimony said, OGE makes sure that the 

nominees and Presidential candidates have complied with the extensive requirements for financial disclosure under the Ethics in 

Government Act. 


KING-6430 with DISTILLER
47 

Mr. SHAUB. That’s exactly what we do. 

Mr. CHAFFETZ. Well, how do you do that if you don’t investigate 

it? 

Mr. SHAUB. We have to take the facts as they are asserted at 

face value, and then using those facts, we determine whether 

they’ve complied with requirements. The reason Congress made 

these reports public—— 

Mr. CHAFFETZ. How can you do that without investigating? You 

don’t ask any questions? 

Mr. SHAUB. It is the same practice as the House Committee on 

Ethics when they review your financial disclosure report. They 

don’t bring you in for an audit and conduct an investigation. We 

don’t do that either. We follow the industry standards of the Senate 

Ethics Committee, the House Ethics Committee, the Office of Congressional Ethics, the Ethics Office for the judicial branch. 

Mr. CHAFFETZ. Do you do any investigations? 

Mr. SHAUB. In the 37 years that OGE has existed, it has not 

done a specific investigation. We haven’t had, to, because we have 

a 14,000-member inspector general community. We work extremely 

closely with them. We have been involved in investigations, though 

not leading them. We assist them, in great detail, in understanding 

these highly complex ethics laws, the conflicts of interest laws, the 

standards of conduct, we work closely with them. 

We also get calls frequently from prosecutors when they prosecute these cases. We work with them to help them understand it. 

We also conduct training for both of them. 

So as I said, OGE gets part of the larger framework for integrity 

in the executive branch. We have our role to play, which is strictly 

laid out by statute and we adhere to our role, but it is one important piece in a framework consisting of multiple executive branch 

entities. 

Mr. CHAFFETZ. And I’m just suggesting that you’re just shuffling 

paperwork. If you are just taking everything at face value and then 

reprinting it and putting it up on the shelf—what good are you? 

Why should we even have you if you’re not going to actually review 

them, hold people accountable, and do any investigation? I mean, 

what is it that they would actually do? Let me read what you had 

written. This is your testimony today. 

OGE makes sure that the nominees and Presidential candidates 

have complied with the extensive requirements for financial disclosure under the Ethics in Government Act. These requirements are 

highly complex, and ensuring full compliance is labor intensive. 

OGE’s goal, with regard to a nominees’s disclosure, is to ensure 

that the Senate receives a complete accounting of relevant financial 

interest in order to facilitate its advice and consent role in considering the President’s nominees. 

The goal as to Presidential candidate is to provide the electorate 

with similar information. That’s a bit of a stretch, isn’t it? 

Mr. SHAUB. It is not a stretch at all. This is—— 

Mr. CHAFFETZ. You do no investigations. You—I question, Mr. 

Chairman, why we have such an agency, because if they are just 

taking it at face value, and then putting it in a file, what if you 

saw something that was askew? 


KING-6430 with DISTILLER
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The Wall Street Journal said that Secretary Clinton’s disclosure—not included in the disclosure were payments for at least five 

speeches that Mrs. Clinton directed to her family’s Foundation. 

So—— 

Mr. SHAUB. Unfortunately, the House is not involved in our Senate confirmations work, so you’re not as familiar with it. 

Mr. CHAFFETZ. It’s a Presidential candidate, it’s different. There 

is if no Senate confirmation. We understand that. 

Mr. SHAUB. Well, it was a multipart question. I was answering 

the earlier question about what we do with nominees. 

Mr. CHAFFETZ. I’m asking about Presidential candidates. And 

there is a lot of controversy swirling around here, and you’re trying 

to parse words by saying, well, if you’re an agent, you have to disclose, if you’re not an agent, you don’t have to disclose it. I don’t 

know how you distinguish whether somebody is an agent or not, 

because on the one hand, the Foundation’s in Secretary Clinton’s 

name. On other hand, she, definitively, according to you, is not an 

agent of a Foundation, or she doesn’t have a title within that organization. I don’t know what good you are if you don’t do this kind 

of work. 

Mr. SHAUB. Well, that’s an incorrect characterization of my statement. I did not say we concluded she is not an agent. We said she 

did not hold a formal position within. Those are two different 

things. 

Your question on how you determine whether someone’s an 

agent, there is an entire body of law and the law of agencies that’s 

well-established in the common law. 

Mr. CHAFFETZ. I’ve gone way over my time. In the case of Secretary Clinton speaking, for instance, at UCLA, did you do any sort 

of investigation to figure out whether or not she was an agent? 

Mr. SHAUB. We did not investigate the factual circumstances that 

she reported. 

Mr. CHAFFETZ. So, and the problem I have is, you go out and 

comment as the authority leading one to believe that, quote, ‘‘disclosure of speaking fees is not required when a public’’—and to 

comment on a specific case when you have not investigated it, I 

think is wrong. 

Mr. SHAUB. We reported on the legal requirement and where 

you’ve compared factual analysis with legal analysis. You have to 

take the facts at face value, that’s why the reports are public, so 

that they can be challenged. This is a good decision for the public 

to have. It is a good conversation—— 

Mr. CHAFFETZ. It is good information to have. 

Mr. SHAUB. —for Congress to have. But our role is legal in this 

respect; we can tell you that if the facts are that they are an agent, 

the information is not disclosable on part A of the form. 

Mr. CHAFFETZ. Help us understand what an agent actually is. 

Mr. SHAUB. An agent? 

Mr. CHAFFETZ. Yeah. 

Mr. SHAUB. An agent is someone who acts on behalf of another. 

That’s the simplest statement; the body of law fills treatises, but 

the simplest statement is someone acting on behalf of another. 

Mr. CHAFFETZ. So it says, quote, ‘‘the rule is different when the 

speaking is done in a personal capacity and the fees that are diVerDate Nov 24 2008 10:26 Jul 31, 2017 Jkt 000000 PO 00000 Frm 00052 Fmt 6633 Sfmt 6633 H:\26027.TXT APRIL

KING-6430 with DISTILLER
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rected are donated to a charity, in which case disclosure would be 

required.’’ 

Mr. SHAUB. These are the same rules that applied to Members 

of Congress and to Senators and to Presidential—— 

Mr. CHAFFETZ. Don’t confuse your branches here for a second. 

We’re talking about executive here. 

Mr. SHAUB. There is one statute that applies to all three 

branches. Congress has been very firm in wanting parity among 

the branches, so they passed only one statute that is applicable to 

all three branches. We have regular meetings with our colleagues 

in the House and Senate and the Judicial Ethics Office to make 

sure we’re all on the same page and we are interpreting these. We 

have a regular three-branch forum. It is three branches, but it is 

actually four offices, because you also have the Office of Congressional Ethics. 

We meet as a group, we talk about the interpretations of laws 

and regulations. And OGE has a great deal more experience than 

they do, simply because we handle a much higher volume. So we 

often take the lead in helping others to understand how we interpret—— 

Mr. CHAFFETZ. You shuffle paperwork. There is no consequence. 

There is no accountability. There is no review and there is no investigation. Why do we need you? If the law is crystal clear, you 

know, I—well, if you’re an agent, you don’t have to disclose; if 

you’re not an agent, you do have to disclose. Your name’s on the 

Foundation, and yet, they weren’t disclosed. Does that really add 

up to you? 

Mr. SHAUB. Sir, I don’t think we just push papers. The work of 

reviewing these financial disclosures—— 

Mr. CHAFFETZ. What do you do when you review it? Is there an 

analysis? 

Mr. SHAUB. There is an intensive analysis of every—— 

Mr. CHAFFETZ. Where is the conclusion of that analysis? 

Mr. SHAUB. The conclusion is the certification by the director of 

the Office of Government Ethics, or the chair of Senate Ethics 

Committee, or the chair of the House Ethics Committee. 

Mr. CHAFFETZ. In the case of a Presidential candidate, do you 

certify? 

Mr. SHAUB. I certify the reports. And I can tell you, there isn’t 

a major party candidate whose reports we didn’t require substantive changes on. Our detailed analysis we went back to every 

single Republican or Democrat who was running for Congress right 

now and made them make significant changes on their—— 

Mr. CHAFFETZ. I’m talking about Presidential candidates, I’m 

talking about Presidential candidates, you keep trying to get—you 

said congressional candidates. 

Mr. SHAUB. No, I’m sorry, if I said congressional—— 

Mr. MEADOWS. I think you just misspoke. 

Mr. SHAUB. I’m sorry. I apologize. I was talking Presidential candidates. There isn’t a major party candidate whose reports we 

haven’t gone back to. And it is a very intensive back-and-forth 

process. We ask them questions. We say, have you fully disclosed 

this? Is there more information on this? Do you understand that 

the law requires that? These are very detailed interactions. I don’t 


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think there is a Presidential candidate out there right now who has 

great love for us, because we’ve made them do so much work on 

their reports. 

Mr. CHAFFETZ. And is all that information, if somebody submitted a FOIA, can they get all that information? 

Mr. SHAUB. You don’t even have to submit a FOIA. They’re on 

our Web page. And we have them annotate—we made the candidates themselves initial each change on the report. So every page 

that has changes, you can see the initials. You could see the reports as they were certified by the Federal Election Commission, 

which receives the reports. They do the first line review. Their 

focus is mostly on getting the right people to file the right reports 

by the right deadline. Then they get them to us, and we get involved in the substantive work. We roll up our sleeves. We spend 

a lot of time. I’m sure these candidates are appreciative of the work 

we do, but I’m sure they also would have rather spent their money 

on something other than having to make all the changes we’ve sent 

them back to do. But we felt we were obligated by the law to hold 

them accountable to meet the financial disclosure requirements. 

Now, if there are factual discrepancies, that’s the reason they’re 

publicly available. So that they can go through the rigorous scrutiny of the press, the American people, Congress. There are plenty 

of eyes looking at these reports. And some of them may have information that they can contradict the factual assertions. But we 

make sure they’re legally compliant. 

Mr. CHAFFETZ. I have lots more questions, but I will yield back. 

Mr. MEADOWS. I thank the chairman. 

Let me go ahead and follow up on a little bit of this. 

Ms. Grundmann, one of the things that I would like, as we look 

at the reauthorization of your particular agency, is if you would 

look quantitatively, and maybe a little bit more forward thinking 

in terms of what are the type of reforms that you say: Golly, I wish 

this were happening, or that were happening. Because as we relate 

to that, sometimes we get used to the laws and the rules that we 

have grown up under. And just like Director Shaub was just talking about a few things that he would have written differently, 

those are the kind of things that as we look to reauthorize what 

we’d like to do is not only look at the reauthorization, but perhaps 

other legislation that needs to accompany that. 

And before the ranking member left, we agreed we’re going to let 

him take the lead on one of those. I think he chose your particular 

group that he’s going to take the lead on. I’m going to take the lead 

on the other two, as we start to work towards that. But are you 

willing to provide that to the committee? 

Ms. GRUNDMANN. We are always willing to provide assistance, 

with one tiny caveat. That—— 

Mr. MEADOWS. Those little caveats are always the troubling pebble in the shoe. But go ahead. 

Ms. GRUNDMANN. Kind of like a footnote. If these laws would 

come to us for interpretation, you know, we’re the adjudicator in 

the case. That’s the only caveat. 

Mr. MEADOWS. We understand that. And so we’ll keep that in 

mind—— 

Ms. GRUNDMANN. Call us. 


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Mr. MEADOWS. —and be sensitive to that. 

Ms. Lerner, I want to come back. You mentioned earlier about 

getting rid of a survey. Which survey were you talking about? 

Ms. LERNER. Sure. It’s an annual survey that was put into effect 

during a prior reauthorization. It requires that we—— 

Mr. MEADOWS. What’s the name of it? 

Ms. LERNER. Hold on. 

Mr. MEADOWS. It’s not the employee satisfaction survey, is it? 

Ms. LERNER. No. No. It’s—I don’t have the—I have a copy—— 

Mr. MEADOWS. Okay. You can get that to me later. I can see 

them, you know, with puzzled looks behind you. And so as we look 

at that, and I say that in a kind way. What I’d love to do is you 

said it was statistically not valid. 

Ms. LERNER. Yeah. 

Mr. MEADOWS. Why is that? 

Ms. LERNER. Because it has an incredibly low response rate. 

Mr. MEADOWS. Does it have an incredibly low response rate because you do nothing with it? 

Ms. LERNER. No. No. No. We have to, by statute. We send it 

to—— 

Mr. MEADOWS. I know, but you only fill out surveys if you think 

that they’re making a difference. So I guess that’s what I’m saying 

is, is do the people who will fill them out see no value in it because 

nothing happens with it, it just gets put on a shelf? 

Ms. LERNER. Not sure why they fill it out or why they don’t. I 

can tell you that we mailed out 3,500—over 3,500 in fiscal year 

2014. Three hundred and fifty-five people returned them. These are 

folks who have come to our agency and asked for help. And we 

can’t help everybody who comes to us. And the fact is that, you 

know, the folks who returned the survey, we had a 10 percent response rate. And of the 10 percent who responded, very few of 

them feel like they got what they asked for. And it’s not statistically significant if we’re only getting a 10 percent response rate. 

Mr. MEADOWS. Well, statistically some would argue contrary in 

terms of that response rate, but in terms of what you do with that. 

Here’s what I would ask for. If you would get us the survey that 

you’re talking about. Obviously, what has happened historically 

and what has not happened historically with that. If you would get 

that to the committee, and we’ll look at that as we look at the reauthorization. I’m one that, you know, if you’re just doing busy work, 

I’m all for streamlining. I think that was in your testimony about 

streamlining some of that. And I’ll be glad to look at that. 

Ms. LERNER. We are taking some actual concrete steps to be responsive and be better about customer service. We just finished a 

study of everyone who participated in our mediation and alternative dispute resolution program. 

Mr. MEADOWS. So do you participate, as Ms. Grundmann—and 

congratulations on being fifth most improved, did you say? 

Ms. GRUNDMANN. Fifth most improve in small agencies. 

Mr. MEADOWS. Okay. Do you participate in the public/private 

partnership surveys? 

Ms. LERNER. Yes. 

Mr. MEADOWS. Okay. All right. And so—— 


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Ms. LERNER. That’s a different—that’s completely different. This 

is the folks—this survey is the folks who come to OSC with—— 

Mr. MEADOWS. And they’re evaluating you? 

Ms. LERNER. Yes. The agency. The results that they got at the 

agency. 

Mr. MEADOWS. And so you’re saying that those results, they say 

they don’t get helped. Is that what you said? 

Ms. LERNER. Well—— 

Mr. MEADOWS. Is that 10 percent of the people say that they 

don’t get helped. Is that your testimony? 

Ms. LERNER. No. We get a response rate of 10 percent. 

Mr. MEADOWS. But the majority of those I think you said feel 

like they didn’t—— 

Ms. LERNER. That’s right. They did not get what they were seeking when they came to our agency. That’s right. 

Mr. MEADOWS. So based on that 10 percent response rate and 

those survey results, what have you changed operationally? 

Ms. LERNER. What we’ve done is tried to actually get some concrete feedback from the people who come to our agency. For example—— 

Mr. MEADOWS. All right. So if we were to do away with the survey and say that’s no longer a requirement, how would you evaluate whether you’re doing a good job or not? How would you know 

whether you’re getting a A or an F? 

Ms. LERNER. Well, I think our results really speak for themselves 

in terms of the number of corrective actions that we’ve gotten. Before I came, they were in around 20 a year corrective actions for 

complainants. Last year they were around 280. 

Mr. MEADOWS. So would you be willing—— 

Ms. LERNER. I would say that those are pretty substantial—— 

Mr. MEADOWS. So would you be willing to put forth a matrix, 

kind of a dashboard of sorts, so we can evaluate? Because, you 

know, it’s one thing with you there and you’re taking it on personally. It would be another when there’s a new special counsel there. 

How do we compare apples to apples and—— 

Ms. LERNER. Look at our actual results. Look at—look at the 

cases that we are bringing to you. 

Mr. MEADOWS. Right. And I guess that’s what I’m saying. I’m 

willing to look at that matrix if you can come up with a reporting 

standard that reports to this committee and says: Okay. Here is a 

matrix on how we decide whether we’re getting—you know, doing 

a good job or a bad job. And we’re willing to look at that. I’ll get 

with minority staff and see about changing that. But I want to 

make sure it’s quantifiable. You know, it’s kind of like we’ve done 

with FITARA. You know, most of the agencies got Fs and Ds. But 

that was a good start. It set a benchmark for where we needed to 

go. And I guess what I’m needing is the same thing from you on 

how we determine whether you’re doing a good job or not. 

Ms. LERNER. Yeah. Look at our cost per case, which has gone 

down significantly. 

Mr. MEADOWS. That’s what I’m saying. If you’ll get that to committee, we’re willing to evaluate that. 

Ms. LERNER. Very happy to work with you on that. 

Mr. MEADOWS. Does that make sense? 


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Ms. LERNER. Sure thing. 

Mr. MEADOWS. So Director Shaub, let me finish with you. Because you’ve mentioned the inspector generals in CIGIE and your 

close relationship, I guess, is the way that you just characterized 

it with Chairman Chaffetz in terms of working with them. How, in 

that passing of the baton, between you and the inspector general, 

or inspectors general, who do you leave it up to for enforcement? 

Because we get an IG’s report, and it depends on, you know, what 

chairman, what subcommittee chairman, whether there’s a hearing, and whether it gets highlighted. How do you pass the baton? 

Because I think in your testimony with Chairman Chaffetz, you 

said that you don’t investigate. You leave that up to the IG. Is that 

correct? 

Mr. SHAUB. That’s correct. 

Mr. MEADOWS. All right. So if the IG finds something that is 

egregious, what happens? 

Mr. SHAUB. Well, at that point, assuming it was a criminal violation, we would—— 

Mr. MEADOWS. No. Let’s say it’s ethical. Let’s say it’s ethical and 

not criminal. 

Mr. SHAUB. Okay. 

Mr. MEADOWS. Okay? So what happens? 

Mr. SHAUB. So if, for example, it was the standard of conduct and 

it was a violation of a provision that was not criminal, the next 

mechanism that would need to come in place would be disciplinary 

action. IGs will write reports. Sometimes they’ll recommend action. 

Other times they’ll state conclusions, and those will go back to the 

agency—— 

Mr. MEADOWS. So how many IG reports have you gotten to have 

action? Would you be the one that would do the action? 

Mr. SHAUB. No. The agencies each have the authority to take individual action against the employees. 

Mr. MEADOWS. All right. Then let’s assume it’s the head of the 

agency. 

Mr. SHAUB. Right. 

Mr. MEADOWS. What happens? 

Mr. SHAUB. Well, if it’s the head of the agency, then a decision’s 

not going to be made by the agency. The President’s the only one 

with the authority to—— 

Mr. MEADOWS. All right. Well, let me—so how often is the President going to do that with one of his nominees? 

Mr. SHAUB. Well, I hope every time that—— 

Mr. MEADOWS. Yeah. I would hope so, too, but I’m not as confident as you are that that would happen. So let me quit beating 

around the bush and share one particular issue that I’d like you 

to look into and report back to this committee. 

It was an IG report that was done by an Inspector General Roth. 

It was a very scathing report of Mr. Mayorkas as it relates to EB– 

5, the potential ethical bounds of interference in terms of visa applications. You know, there were some allegations of interference at 

the very highest level, which would include some elected officials 

in very nearby States. 

I read it. I could not believe it, because normally, the inspectors 

general are not that scathing in their report. And as I read this 


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particular issue, it really is something that was troubling. Obviously, Mr. Mayorkas didn’t agree with that. But being where he is 

in that particular agency, so the only person that could hold him 

accountable would be the President? Is that what you’re saying? So 

you don’t have the authority to do that? 

Mr. SHAUB. You know, I have to beg your pardon. I remember 

reviewing Mr. Mayorkas’ financial disclosure report—— 

Mr. MEADOWS. Yeah, and this is not financial disclosures. This 

really has to do with the fact that he was intervening on behalf 

GreenTech Automotive, one where Mr. Clinton, President Clinton, 

had given a speech. All of a sudden, there was money that came 

over. I mean, it was—you know, I’m not a conspiracy theory kind 

of guy, but when you look at connecting the dots, it was very troubling. And the fact that the inspector general would look at that 

and have employees, whistle blowers, within the agency that said 

they felt like Mr. Mayorkas had acted improperly, where does that 

go? Because the inspector general felt like he had done his job. And 

so does it come to us, or who would investigate that? 

Mr. SHAUB. So the reason I mention his report is I was going to 

tell you I can’t remember his exact position, his position title. Was 

he assistant secretary? Under Secretary? 

Mr. MEADOWS. I don’t recall either. So—— 

Mr. SHAUB. In any event, he works, then, for the State Department and would report—— 

Mr. MEADOWS. Well, this would—well, so who—— 

Mr. SHAUB. It wouldn’t be the President. It could be—the head 

of the agency could take some action. 

Mr. MEADOWS. So your agency has no role in that whatsoever? 

Should you have? 

Mr. SHAUB. When an IG is conducting an investigation, we don’t 

want to step on the IG’s toes. We’re very respectful of IG jurisdiction. So during the investigative phase, absolutely not. 

Mr. MEADOWS. Yeah, I was passed a note. He was then the director of USCIS. Now he’s the DHS deputy director. 

Mr. SHAUB. Okay. So either the President or somebody who’s in 

charge of his agency at a higher level can take some action. Only 

the President could take removal action. So something like that actually would be well within your jurisdiction if you’re asking 

whether you could, obviously. 

Mr. MEADOWS. Well, we’ve got all these other ethics groups out 

there, Congressional Ethics. You mentioned some of those that 

they’re your sister—they actually take action. Are you the only one 

that just does financial disclosure with no actions? 

Mr. SHAUB. No. We don’t just do financial disclosure. But we’re 

the prevention piece of the framework. This is a broad framework—— 

Mr. MEADOWS. So who’s the enforcement piece? Because it’s not 

the IG. 

Mr. SHAUB. No. That would come to agency management or the 

White House to take action against a Presidential appointee. 

Mr. MEADOWS. Do you not see an ethical dilemma that you put 

yourself in when you have someone that is a nominee having to be 

held accountable by the person who nominated them? 


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Mr. SHAUB. Well, that’s the framework the Ethics in Government 

Act established. But we do have the separation of powers issue 

where Congress has the ability to ask the very questions you’re 

asking about an individual. And you could certainly have a hearing 

on that investigative—— 

Mr. MEADOWS. So do you think that your agency needs to have 

expanded authority to be able to investigate? 

Mr. SHAUB. I don’t think so. I think that there—— 

Mr. MEADOWS. You don’t want it? 

Mr. SHAUB. Well, I don’t think we should have it. What I might 

want one way or the other is not as relevant as what would be the 

right thing. And what’s the right thing is that we have a broad 

framework with a number of different, very specialized entities 

that perform very important roles. The inspectors general have investigative authority. Agencies can take disciplinary action. In 

whistle blower cases, you mentioned whistle blower in this example, the Office of Special Counsel can initiate an action against 

them. And I won’t speak for what’s within your power, but they 

then take a case before the MSPB. 

So there are—everybody has their individual roles. We, for instance, don’t adjudicate the disciplinary cases. The MSPB has the 

authority to do that. So ours is the prevention piece of the program. 

Mr. MEADOWS. So if the employees—what you’re saying, is if the 

employees in that particular situation feel like that they have been 

thwarted, then either special counsel or—I guess it would be special counsel first? 

Ms. LERNER. No. I don’t believe we would have jurisdiction over 

these matters. 

Ms. GRUNDMANN. Are we talking about—— 

Mr. MEADOWS. I’ll tell you what I’ll do, is let me do this: I’ll get 

that particular IG’s report. I’ll get it to all of you and then let you 

weigh in before we go forward. How about that? 

Ms. GRUNDMANN. Are you talking—just to be clear, you’re talking about a political appointee who’s not the head of the agency? 

Mr. MEADOWS. Right. Yeah, he would have been. That’s correct. 

Ms. GRUNDMANN. Okay. We wouldn’t have jurisdiction. 

Mr. MEADOWS. But there was employees that felt like they were 

wronged that were rank-and-file employees underneath. 

Mr. SHAUB. Yeah. I’m sorry. I was talking about the whistle 

blower complaints of the individual level employees—— 

Mr. MEADOWS. Okay. All right. So basically other than our oversight, we need to have a hearing on that if I care about it. 

Mr. SHAUB. Well, the Constitution has set up Presidential appointments, Senate confirmation process. I think I saw talk of an 

impeachment proceeding in the news about one Federal official. So 

there are constitutional mechanisms. But at the level you’re talking, that’s—we’re getting into the constitutional area. 

Mr. MEADOWS. Okay. Well, I want to thank each one of you for 

your testimony. I know that this is sometimes like going to the 

dentist and you’re just glad it’s over. And so—but I would say this, 

is if you will get those follow-ups that counsel’s been taking notes, 

if you would get those follow-ups, we’ll be expeditious in our return 

in terms of information to you, and hopefully work with you on the 


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reauthorization language, or any caveats that might need to be addressed legislatively. 

And if there’s no further business, the subcommittee stands adjourned. 

[Whereupon, at 12:24 p.m., the subcommittee was adjourned.] 


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