CEO 07-3 -- January 31, 2007



To: Robert Beitler, General Counsel, Office of Financial Regulation Financial Services Commission (Tallahassee)


Employees of the Office of Financial Regulation have not received a "gift" for purposes of Section 112.3148, Florida Statutes, or an "expenditure" for purposes of Section 112.3215, Florida Statutes, when they attend a conference in their official capacity sponsored by an organization that offers a discounted rate to employees of state and federal regulatory agencies. Here, even though some of the organization's members may be regulated by the Office of Financial Regulation and the conference is underwritten by entities that may be Executive Branch lobbyists or principals, the discounted registration rate of $250 per person is neither a gift nor an expenditure for purposes of Florida's ethics laws.


May employees of the Office of Financial Regulation take advantage of a discounted rate to attend a conference without violating the Code of Ethics, where the association sponsoring the conference is neither regulated by the agency nor registered as an Executive Branch lobbyist or principal, but where some of the association's members are regulated by the agency and some of the entities listed as conference sponsors and exhibitors are registered to lobby Executive Branch agencies?

Under the circumstances presented, your question is answered in the affirmative.

In your letter of inquiry, you explain that the Financial Services Commission's Office of Financial Regulation (OFR) has various regulatory responsibilities, including oversight of international banking activities in Florida. The Florida International Bankers Association (FIBA) is an association of various entities, some of which are regulated by OFR. However, the association itself is not listed as the principal of lobbyists who lobby Executive Branch agencies, according to the Executive Branch Lobbyist Registrar. FIBA is sponsoring its Annual Anti-Money Laundering Compliance Conference in Miami in February 2007, and has established a $250 conference rate for employees of federal and state regulatory agencies. This reduced rate is considerably lower than the fee charged to FIBA members and non-members, and you question whether employees of OFR can attend the conference at the reduced rate without violating the State's ethics laws. OFR will pay the travel, hotel, meal expenses, and registration fee of those employees it authorizes to attend.

Section 112.3148(4), Florida Statutes, provides:

A reporting individual or procurement employee or any other person on his or her behalf is prohibited from knowingly accepting, directly or indirectly, a gift from a political committee or committee of continuous existence, as defined in s. 106.011, or from a lobbyist who lobbies the reporting individual's or procurement employee's agency, or directly or indirectly on behalf of the partner, firm, employer, or principal of a lobbyist, if he or she knows or reasonably believes that the gift has a value in excess of $100; however, such a gift may be accepted by such person on behalf of a governmental entity or a charitable organization. If the gift is accepted on behalf of a governmental entity or charitable organization, the person receiving the gift shall not maintain custody of the gift for any period of time beyond that reasonably necessary to arrange for the transfer of custody and ownership of the gift.

Section 112.3215(6)(a), Florida Statutes, provides:

Notwithstanding s. 112.3148, s. 112.3149, or any other provision of law to the contrary, no lobbyist or principal shall make, directly or indirectly, and no agency official, member, or employee shall knowingly accept, directly or indirectly, any expenditure.

Initially, we note that these provisions would only apply to OFR employees if they are state-level procurement employees or if they file financial disclosure. Consequently, the Code of Ethics for Public Officers and Employees would not be implicated if OFR sends employees who are not in either category to the conference at the reduced rate of $250 per person.

For OFR employees in one of these categories, additional analysis is necessary. Pursuant to Section 112.3148(4), Florida Statutes, reporting individuals or state-level procurement employees are prohibited from knowingly accepting, directly or indirectly, a gift with a value in excess of $100 from a prohibited donor. Gifts with a value in excess of $100 from non-prohibited donors can be accepted by the employee but must be disclosed on a Quarterly Gift Disclosure form—CE Form 9, as required in Section 112.3148(8), Florida Statutes.

Although the organization putting on the conference—FIBA—is not registered as a principal of lobbyists who lobby Executive Branch agencies, some of its members are regulated by OFR, and its list of conference sponsors contains entities who may be principals or employers of lobbyists. Nonetheless, there is no indication that those sponsors have given an indirect gift to any OFR employee vis-à-vis the discounted rate. See Rule 34-13.310(6), Florida Administrative Code, on indirect gifts. More importantly, where the discounted registration rate is being offered to the agency and not the employee personally (since it is the agency that will designate which employees attend the conference and then will pay their $250 registration fees along with other travel expenses), we do not view the discounted registration rate as a gift to the individual employee but instead, view it as a gift to the agency. Moreover, since the gift laws do not prohibit or require the reporting of gifts to agencies, and since we have previously opined that public officers and employees have not received a gift when they travel on official agency business paid for by their agencies, the discounted conference rate offered to OFR employees is neither a prohibited gift nor a gift which must be disclosed by OFR employees who attend the conference. See CEO 06-27 and CEO 91-46.

Turning now to Section 112.3215(6)(a), Florida Statutes, this provision prohibits lobbyists and principals from making, directly or indirectly, and agency officials and employees from knowingly accepting, directly or indirectly, certain "expenditures." As has already been acknowledged, FIBA is not registered as an Executive Branch agency lobbyist or principal. Therefore, the reduced registration rate is not a prohibited expenditure by FIBA. Nor does its character change because its sponsors may be lobbyists and/or principals before Executive Branch agencies. In CEO 06-14, we considered whether corporate donations which underwrote the annual Prudential Financial-Davis Productivity Awards were indirect expenditures which principals were prohibited from making and agency officials and employees were prohibited from accepting. Applying the indirect expenditure criteria in Rule 34-12.190(3), Florida Administrative Code, we concluded that the corporate donations were not prohibited indirect expenditures because the sponsors did not select or have prior knowledge of award recipients, there was no evidence of an intent to make an expenditure for the personal benefit of any individual officer or employee, and it was the non-profit organizations who recognized and rewarded meritorious state employees, not the corporate sponsors.

Here, there is no indication that the corporate sponsors and exhibitors of FIBA's Anti-Money Laundering Compliance Conference are underwriting the reduced registration rate for the personal benefit of any particular OFR officer or employee. Instead, it is the agency that designates which employees will attend the conference. Based on these considerations, we find that the corporate sponsors and exhibitors which help underwrite the FIBA conference have not made a prohibited indirect expenditure when FIBA offers a discounted conference rate to employees of state and federal regulatory agencies.

Accordingly, we find that OFR employees may attend the FIBA conference at a discounted registration rate without implicating Sections 112.3148 and 112.3215, Florida Statutes.

ORDERED by the State of Florida Commission on Ethics meeting in public session on January 26, 2007 and RENDERED this 31st day of January, 2007.

Norman M. Ostrau, Chair