By Tara Hoke
Situation
The U.S. Department of Justice announces the indictment of more than two dozen public officials, government contractors, and political leaders on charges that include bribery, fraud, and other financial crimes. The indictments are the result of a comprehensive investigation into political corruption in a Mid-Atlantic state; the probe had been conducted by federal agents working in tandem with state authorities.
In the media storm that follows this announcement, ASCE's Committee on Professional Conduct (CPC) sifts through news accounts to determine whether any ASCE members are implicated in the alleged criminal conduct. One member who quickly comes to light is the principal of a small engineering firm who is accused of paying bribes to a city manager in exchange for public contracts.
The indictment outlines a pattern of gift giving and other payments from the ASCE member to the city manager over a four-year span, ranging from minor gifts of drink and entertainment to transfers with a more significant dollar value. On at least three occasions the member had invited the city manager to vacation free of charge at the member's beachfront rental property, offers for which the member later sought reimbursement from his firm, categorizing the cost as a business expense for "client use of rental home." Additionally, in one six-month period, the member had made a series of cash payments to the manager, payments that amounted to a total transfer of $10,000. The indictment notes that during the same years in which these cash and in-kind payments were made by the member, the city manager was instrumental in securing nearly $1 million in public contracts for the member's firm.
The member and his firm reach a plea agreement with prosecutors; the member steps down from his position in the firm and is sentenced to 18 months of probation, while the firm itself pays a hefty criminal fine. The action also captures the attention of the member's state licensing board, and he is ultimately forced to surrender his P.E. license in his home state and in two neighboring states.
Question
Did this member's actions in making gifts and other payments to a public official violate the ASCE Code of Ethics?
Discussion
Fundamental Canon 5 of the ASCE Code of Ethics states, "Engineers shall build their professional reputation on the merit of their services and shall not compete unfairly with others." Guideline a under that canon further emphasizes, "Engineers shall not give, solicit or receive either directly or indirectly, any political contribution, gratuity, or unlawful consideration in order to secure work."
A key concept in this ethical precept is the existence of an improper motive. Gifts and other contributions are not inherently suspect on their own; a gift can be a sincere expression of thanks or appreciation, for example, while making a campaign contribution is an important part of a person's right to participate in the political process. Yet when engineers give gifts to decision-makers on public or private contracts in order to induce those recipients to misuse their roles for the purpose of personal gain, it subverts the process of fair competition that is critical to the efficient, equitable, and ethical delivery of engineering services.
Unfortunately, in an enforcement setting, this focus on motive presents the often difficult task of inferring a donor's thoughts or mind-set in making a gift or payment. In the present case, when contacted by the CPC, the accused member was quick to deny any intent to influence his firm's selection for public contracts. The member claimed that he had known the city manager for nearly 25 years and that over the years the two had developed a close friendship. While acknowledging a habit of generous gift giving, the member claimed that this practice was by no means one-sided; the city manager in turn had often sent gifts to the member on holidays and other significant occasions.
With respect to his largest "gift"--the payment of $10,000 in cash--the member asserted that the city manager had just gone through a costly divorce and was suffering financial difficulties. He claimed that the money was intended simply to help his friend through a tough time, with no expectation of a quid pro quo. As further support for his claim, he noted that these gifts had been made when his firm was not seeking to obtain or renew an existing contract, at a time when the city manager had no current or pending decision that might have prompted a corrupt payment.
Indeed, the member claimed that prosecutors had never been able to identify a direct link between his gifts and any specific action by the city manager. He said that his firm was a well-respected business that had worked on city projects for many years and that any contracts it received had been awarded based on the firm's familiarity with the project and its history of successful performance. Though recognizing that his gifts violated the letter of the law, the member felt that his actions had never resulted in any corrupt or unfair advantage, and he expressed bitterness at being unfairly deemed as a player in the larger corruption scheme exposed by the federal investigation.
Upon review of the case, the CPC was not swayed by the member's attempt to disclaim an ulterior motive for his "generosity." The committee felt that the member's payment of $10,000 in small cash amounts showed that the member recognized the illegality of his action and was attempting to avoid detection for the same. The CPC also thought that the member's choice to seek reimbursement as a business expense for the manager's use of a rental home belied the member's claim that his gift giving was sparked by personal friendship.
Most of all, they rejected the member's suggestion that an attempt to influence required a direct quid pro quo and that his payments must be blameless unless they could be directly tied to a specific desired action. Instead, the CPC felt that improper influence could be created by a course of gifts and payments over a period of time and that an employee who enjoyed the benefit of such a regular stream of gifts-and who was eager to see those gifts continue-could easily be swayed to favor decisions that pleased the financial benefactor over those serving an employer's best interests.
As such, the CPC found that the member's actions violated Canon 5 of the ASCE Code of Ethics and recommended to ASCE's Executive Committee that he be expelled for a period of three years. The member was informed of this recommendation and advised of his right to present a defense in person or in writing before the Executive Committee, but instead he chose to resign from the Society. When a member resigns following notice of a pending ethics investigation, the resignation is considered to be "with prejudice"--meaning the member cannot subsequently rejoin the Society unless his reinstatement is approved by a two-thirds vote of the Executive Committee.
In 2006, not long after this case was decided, ASCE's Board of Direction approved an amendment to Fundamental Canon 6, which at the time read: "Engineers shall act in such a manner as to uphold and enhance the honor, integrity, and dignity of the engineering profession." This new edit imposed an express obligation on engineers to act "with zero tolerance for bribery, fraud, and corruption," and added supplemental guidelines emphasizing the need for transparency, fidelity, and scrupulous honesty in the "control and spending of monies." As such, if this case were examined under today's Code of Ethics, it is likely the CPC would deem this member's conduct to have also violated Canon 6.
Tara Hoke is ASCE’s general counsel and a contributing editor to Civil Engineering.
© ASCE, ASCE News, November, 2018
